Saskatoon real estate: Week in review (August 4-7 2009)
Short weeks following a long weekend almost always produce fewer home sales, and this week was no exception for the Saskatoon real estate market. Unit sales of single-family houses and condominiums slid to seventy-seven properties, down twenty-five sales from the previous week, and reaching their lowest level since the second week of June. On the other hand, this same week in 2008 was one of the top-ten losers for the year with firm sales of just thirty-five properties, so seventy-seven sales actually looks pretty good.
New listings were another story altogether as local agents brought one hundred and one Saskatoon homes to the market, an increase of ten units over the previous week, and seventeen fewer homes than were added during the same period last year.
Click the image for a larger version of the graph.
In what’s starting to look like a near definite trend, the “active” inventory of Saskatoon MLS listings continued its downward trek falling to 1212 properties, slipping just nineteen homes from last week, but more than twenty percent lower than it was at this time last year when it sat at 1555. As of this morning, we have 723 houses, 395 condos, 25 semi-detached homes, 14 mobiles, 11 vacant lots, 32 duplexes, and 12 properties, which apparently, are best described as something “other” than those aforementioned housing types.
In 2008, the inventory of active listings continued to grow aggressively for another nine weeks to peak at 1756. In 2009, active listings peaked much earlier at 1528 and have been trending lower since late May. Demand, and general interest in the Saskatoon housing market seems to remain remarkably strong, so agents are starting to hear more complaints from home buyers about a poor selection. Premium homes that are in good condition and realistically priced, can be expected to attract interest fairly quickly. While I continue to feel that the market is somewhat fragile, it has a reasonably good feeling of balance to it. Almost every transaction involves a negotiation, and neither buyers nor sellers are displaying an air of cockiness. It’s the kind of market that I enjoy working most. I hope that listings start to level off some and that we don’t return to a major imbalance of supply and demand in the other direction.
In pricing news, forty-eight adjustments were recorded throughout the week and nineteen of twenty-two canceled or withdrawn listings re-appeared as a new listing, most sporting a new, lower price.
Sale prices took a bit of a downturn as the average selling price of a Saskatoon home slid nine thousand dollars on a week-over-week basis to $281,400. Following six consecutive weeks of gains, the six-week average finally let up, sliding four thousand dollars from last week to $283,736, down from $296,934 for the same week in 2008. The four-week median came down just under a thousand bucks to $275,000, off thirteen thousand dollars from this same week in 2008.
Click the image for a larger version of the graph.
The average underbid on properties that sold below the asking price took a pretty sharp drop, falling to just $9,173 from $13,550 the week before. That represents an average discount in the range of 3.2%, about 1.5% lower than what we’ve been seeing most weeks. Sixty-six percent of all sellers managed to strike a deal within ten thousand dollars of their asking price, and for the first time in a long while there wasn’t a single-sale that was discounted by twenty-five thousand dollars or more. Overbids were almost as rare with just two properties attracting offers above asking price, with an average overbid of just $1275.
See a Google map displaying the boundaries of Saskatoon real estate “areas” here
Data collection and calculation for our statistical reports
I’m always happy to answer your Saskatoon real estate questions. All of my contact info is here. Please feel free to call or email.
Real estate geeks can follow our daily updates on Twitter @Norm_Fisher.
Our Saskatoon home search tool offers MLS listings represented by all real estate brands, presented with more detail than you’ll find anywhere else. Check it out here.
Norm Fisher
Royal LePage Saskatoon Real Estate
37 comments so far. We'd love to hear your thoughts.
August 8th, 2009 at 4:19 PM
Norm,
thanks for the stats. Great as always.
Just wanted to touch on the complaints from buyers not having enough selection. Over 1200 listings produces a ballpark 3-4 month inventory. Is that not enough supply? Or is it a price ranges, or certain areas that are lacking in supply for these buyers?
August 8th, 2009 at 7:50 PM
Hey, bit of off topic here checking out your blog after some time. No more Point2Agent?
August 8th, 2009 at 10:18 PM
Hey George,
A three-month supply sounds reasonably good but some segments of the market have a much smaller inventory. For instance, if you’re looking for a 3-bedroom single-family home in areas 1, 2 or 3 between $270,000 and $330,000 there are just 83 actives. Ten of those are probably conditionally sold reducing the inventory of available homes to 73. There were 75 home sales matching that criteria in the last thirty days, leaving just a one month supply.
Hi Raj,
I am still using Point2 at http://www.mysaskatoonhome.com, primarily for property marketing. With the blog, I wanted to try some things that were a little too challenging on the Community Server platform and thought the WordPress might be easier to work with. I really wanted to add an IDX product to the blog and just couldn’t do it there. I’m also thinking of adding some video in the future and I never was able to get a video to work right on CS. Our Point2 site and all of the syndication tools continue to be an important part of our marketing plan. Nice to hear from you.
August 10th, 2009 at 9:49 AM
Wow. It is quiet in here. Hi Norm. I just wanted to stop in and drop a post so you knew I was a good weather poster (and not just a bad weather poster).
August 10th, 2009 at 10:16 AM
L.oki,
Your thoughtfulness is heartwarming. Thank you!
August 10th, 2009 at 12:13 PM
Hey Norm, its been a long time since I’ve posted here — probably a year. If you recall, I bought my home about two years ago after doing very extensive research on the market. I haven’t looked much at the housing stats since then but I decided to spend some time looking at it this morning — by the way, great improvement to your stats pages.
That big glut of houses hitting the market last year really shot up our inventory but it seems like all those builders have left the market. A lot of people I knew were waiting for the market to settle down before buying again and it looks like those people are now entering the market (or else new people are moving here). If supply/demand trends continue like this, it should put upwards pressure on housing prices. Considering this — and if the recession is indeed ending, this is probably a pretty good time to buy a home in Saskatoon.
Anyway, just thought I’d say hello — also checked out your MLS search engine — very impressive. Wish I had that when I was looking. Take care Norm!
August 10th, 2009 at 1:22 PM
Hey Doug,
I certainly do remember you. It’s nice to hear from you again. Thanks for stopping, and thanks for the kind feedback.
August 10th, 2009 at 2:46 PM
George, I thought I would address something that I noticed in Saskatoon real estate market. It seems there are a lot of inconsistencies with regards to location, price, amenities of a home. With that, I mean you may have someone that unrealistically believes that their home is worth say $350,000.00 but requires significant updating and renovations may or may not be in a desireable location. On the other hand, you have a new home that is also priced at $350,000.00 in a new subdivision. If you were specifically looking at a price point of 350 or under, it is difficult to find a home that may meet all of the items you are looking for. Those that are priced right, have a great location, and dont need a lot of work are hard to find.
With the boom in 2007 it the typical comparisons in a general location didnt help much since the price point changed so quickly. I have seen some homes on the market that have been there for 1-2 years….and although the owners dont seem to get it, they are still on the market for a reason.
The trend seems to be that Saskatoon real estate is holding its own. Is it a good time to buy? Maybe, but what if you buy a 350 home today and next year its worth 320 and you have to move? Depends on individuals/circumstances and budget. IMO the market will take another year to truly reflect any predictability.
August 10th, 2009 at 3:41 PM
It has been a quiet summer. As the employment numbers for July were released Friday, I’ll only briefly touch on them. From June 2008 through July 2009 Saskatchewan has seen the elimination of 7,800 full-time positions which were partially offset by the creation of 3,000 new part-time positions, for a net loss of 4,700 jobs. Unemployment increased 0.1% to 4.7%.
During that time the population of the province increased by 900, so unless everyone in other areas in the province left in droves for Saskatoon, I’m not sure I place much faith in the City of Saskatoon’s estimation of a 5,000 population increase (YTD); and with 1,200+ listings still on the market, I’m even less inclined to believe so. It does make for good headlines, though.
http://www.statcan.gc.ca/daily-quotidien/090807/t090807a4-eng.htm
August 10th, 2009 at 3:42 PM
Hey Cindy,
Yeah its still a pretty tough decision. If someone is looking for an investment opportunity, I’d invest in US real estate versus Saskatoon as I think its way more undervalued there than it is in Saskatoon. That said, if I was looking for a home, the stats that I’m seeing would give me some confidence that my home would hold its value. When I was buying my first home, thats mainly what I was looking for. There were all of these people saying the sky was falling and the market was going to crash… and it could have happened. Inventory got pretty high there and could have kept climbing and pushing prices down. Whos to say whether a bunch more builders come into the market and do exactly that? Its doubtful though — it looks like supply is weaking, demand is strengthening, all good in the short term. I made my decision based on what I saw happening in the short term and thats really all anyone can do.
August 10th, 2009 at 3:50 PM
Cindy, I agree that we’ll need at least another year to ascertain any market stability. In fact, I’d even go further and suggest that until we see interest rates in the 5-6% range and inventories return to ‘normal’ levels, we’re not going to see a balanced market. Right now demand is being artificially inflated by historically-low interest rates, so once you remove that equation…
August 10th, 2009 at 4:53 PM
Jason,
According to the SP, August 8.
Despite Saskatchewan’s overall decrease in the number of jobs last month, Saskatoon continued to add workers and counter national trends.
Saskatoon created about 1,100 jobs last month over June and added almost 7,000 from July of last year, according to Statistics Canada numbers released Friday.
Not sure about the full time/part time share on these.
August 10th, 2009 at 6:01 PM
Norm, yes, it would certainly seem that Saskatoon has benefited perhaps more than other areas with respect to job growth in the province. It would be easier to gleam the significance of these numbers if we had a breakdown; is it possible that these also include self-employed? I’m not saying we haven’t seen a local population increase — I’m just saying I find the city’s numbers perhaps a bit too overly optimistic.
August 10th, 2009 at 6:14 PM
Here is the StatsCan report that details what has happened in various municipalities but it doesn’t slice things up by full time, part time, or self employed.
Were those recent population estimates produced by the City of Saskatoon?
August 10th, 2009 at 6:23 PM
Jason and Norm,
I’ve heard about architects in the states who are getting jobs as waiters to make ends meet. The recession has definately hit Saskatchewan, our company exports about 40% to the states and we’ve been hit hard. I’m actually surprised by how strong demand is for housing right now, but our company also just hired someone from Ontario and I have a feeling that while its tough here — its really tough everywhere else.
Saskatchewan has some great advantages that others don’t. Our mining industry isn’t going anywhere and Agriculture is doing well. Our high tech sector and export industries are hurting like everyone else but as long as we survive for a year or two I think we’ll be fine and in the mean time we’re helping to keep the economy going.
I have no idea why people are buying houses, but its good in that it showing people have confidence in their future in this city. As long as that confidence exists, Saskatoon will succeed – I lived in rural Saskatchewan for years where that confidence didn’t exist — young people moved away, businesses were lost with retirements, and communities died. I have a feeling that sentiment now exists in a lot of places outside of Saskatchewan and I don’t think we appreciate just how good we have it here.
August 10th, 2009 at 8:29 PM
Norm, I didn’t realize the results were a ‘sampling’ (one would have assumed Statistics Canada had access to more substantial data than a cross-section of phone polls in making their estimates). And yes, I believe the City of Saskatoon produced their own estimates (I was unable to confirm this in the article online with the SP). We’ll see what seasonal adjustments and other refinements they make over the next few months. I’m sure the population is up, I’m just not convinced it’s in the 5,000-range (but maybe it is).
http://www.statcan.gc.ca/cgi-bin/imdb/p2SV.pl?Function=getSurvey&SDDS=3701&lang=en&db=imdb&adm=8&dis=2#b10
Doug, you make a lot of great points. I know exactly what you’re saying about confidence, and this province definitely has some unique potential (provided they don’t adopt Alberta’s play book and instead toss most of their strategies, starting with royalties). Let’s hope that many of these young first-time homebuyers haven’t gotten in over their heads (and vastly underwater) in the process.
August 10th, 2009 at 8:34 PM
Lol. Oh, you skeptic, you!
These are the same employment figures that we’ve been relying on forever, whether they’re good or bad. Hopefully Statistics Canada knows how to compile accurate stats.
These are also the “seasonally adjusted” numbers.
August 10th, 2009 at 8:47 PM
Yes, that’ll teach me for not taking the opportunity to read the ‘fine print’ sooner…
If we take these as accurate, the City is close with their 5,000 estimate (5,900 by StatsCan), although I’d say that the City’s assertion of 218,000 for a current population is ‘lofty’, at best (again, in comparison to the 202,700 by StatsCan). I suppose it’s probably hoping for too much that the next round of 5,000 ‘imports’ will at least have better driving skills…? :O
August 11th, 2009 at 1:40 PM
Saskatoon housing starts drop significantly from 2008
http://www.thestarphoenix.com/business/Saskatoon+housing+starts+drop+significantly+from+2008/1881589/story.html
“The number of housing starts in the Saskatoon region between January and July has dropped by 71.8 per cent from the first seven months of 2008…”
Canadian Bankruptcies Skyrocket in June
http://www.thestar.com/business/article/679449
“The number of bankruptcies rose by a staggering 51.6 per cent in June compared to the year before, as more Canadian consumers and businesses were unable to pay their debt… The number of proposals, a last ditch effort to pay creditors a portion of what they are owed, also jumped by 49.5 per cent.”
We’ll see what the numbers for July are in September, but these don’t seem to be indicators that we’re entering any period of recovery, rather the reverse (that we could in fact be sliding into a deeper recession/depression).
August 11th, 2009 at 4:23 PM
Further to Jason’s comment, this from Crikey in the latest post.
Interesting insolvency numbers from StatsCan today:
• Total insolvencies (business and personal) up 52% YOY nationally
If I’m reading it right, the provincial breakdown of insolvency increases is even more interesting:
• ON up 54% YOY
• BC up 73%
• AB up 87%
• SK up 99%
Only NWT and Nunavut saw a higher % increase YOY. Gah.
This is awesome because it seems that the more bad news we get, the better housing and stock markets get. I think we’re gonna be rich!
August 11th, 2009 at 4:42 PM
Yikes! Someone else emailed me about bankruptcies doubling in SK, too (but thanks for the link Crikey). From a % standpoint, obviously scary. But from an actual #’s standpoint, 283 in SK is not too bad compared to 3,787 in QC, 6,392 in ON, 1,246 in AB and 1,227 in BC (and yes, I actually surprised myself with my attempt to put the SK numbers in a positive light). Still, not the direction we want to be headed in…
August 11th, 2009 at 10:29 PM
“I think we’re gonna be rich!”
Woo-hoo!
August 12th, 2009 at 10:04 AM
New home prices continue slide
http://www.financialpost.com/news-sectors/story.html?id=1884812
“New home prices in Canada fell for the ninth straight month in June despite predictions the slide would finally come to an end… The largest monthly gains were recorded in Saskatoon at 0.5%, followed by 0.4% increases in both Winnipeg and St. John’s, NL… The largest yearly decline was in Edmonton at 11.7%, followed by Saskatoon at 10.4% and Vancouver at 9.1%.”
August 12th, 2009 at 10:51 AM
Crikey,
Lol. Love it!
Jason,
Interesting numbers. Similar to the housing start numbers. Large drops YTD (72%), but some gains for July 2009 over last July (43%).
August 12th, 2009 at 1:08 PM
Hi Norm,
Just thought that I would stop by and see how Saskatoon’s market is holding up. It looks as though Saskatoon is following along similar trends as Calgary. Here in Calgary we are starting to see more of a balanced market properties are selling closer to the list price and the buyers do not seem to be as apprehensive to purchase as they were a few months ago. Hopefully, this balanced market trend will continue in both cities for the time being.
August 12th, 2009 at 3:24 PM
Hey Miranda,
Nice to hear from you. I hope that you’re well and that things are taking off for you in Calgary.
Real estate seems to be brisk across the country, and Saskatoon is no exception, but we aren’t seeing the crazy kind of bidding stuff that we’re hearing about elsewhere. That suits me just fine.
Thanks again for stopping.
August 12th, 2009 at 4:57 PM
Norm, what areas/provinces are you hearing about “bidding stuff”?
August 12th, 2009 at 5:02 PM
L.oki,
I hear that Toronto is insane and that about a third of all listings are subject to bidding wars. I believe that Vancouver is also out of control.
It only makes sense in this new world, which makes little sense, that our most expensive housing markets would be going through this kind of thing.
August 13th, 2009 at 3:57 AM
My thought is that the bidding wars in Toronto/Vancouver and housing bubble being kept artificially high for that matter, might be due to the announcement of the new HST tax arriving June/July 2010. People (lol, or sheeple?) trying to get in and build before having to shell out more coin.
wonder how long Sask can hold the HST at bay and what impact it could have here.
August 13th, 2009 at 8:19 AM
Having a separate GST and PST is an economic nightmare and an age old methodology. The sooner we harmonize the better (IMHO).
August 13th, 2009 at 8:22 AM
Norm, do you see that type of bidding activity contagiousness spreading across Canada. We first saw this in the coastal regions of L.A. etc.
August 13th, 2009 at 9:08 AM
Now that you mention it, L.oki… the looming HST may be spurring buyers in BC and ON to move more quickly than they otherwise would with regard to buying. Starting July 1/2010, the HST will double the sales tax paid on a range of things to which GST only now applies. This will include new taxes on real estate transactions and added taxes on the purchase of new homes. I’m not too sure how many people in those provinces are being spurred to act early due to this, however. I’m thinking it may be pulling forward demand some.
August 13th, 2009 at 10:26 AM
L.oki, allow an input tax credit for the PST and I’m all for harmonization.
August 13th, 2009 at 11:48 AM
L.oki,
“Norm, do you see that type of bidding activity contagiousness spreading across Canada.”
I sure hope not. Inventory is definitely light in some price categories but there are no speculators so most of the buying activity is based on actual affordability. I think we’re still operating at our upper limits of affordability.
August 13th, 2009 at 12:23 PM
Drop in revenues will affect budget
http://www.thestarphoenix.com/business/Drop+revenues+will+affect+budget/1887999/story.html
“Finance Minister Rod Gantefoer says a drop in the province’s anticipated revenues is ‘serious’ and cautioned volatility in key areas such as potash may cause more turmoil before the budget year is over…. The tightening financial picture is a reality of the volatility of commodity markets… The province’s general revenue fund is expected to remain in the black, but the surplus is likely to be smaller than the $425 million first forecast.”
Well-timed photo intrusion turns Banff squirrel into Internet celebrity
http://network.nationalpost.com/np/blogs/posted/archive/2009/08/13/canadian-squirrel-becomes-internet-celebrity.aspx
August 14th, 2009 at 8:29 AM
River Landing budget balloons by $6.3 million
http://www.thestarphoenix.com/technology/River+Landing+budget+balloons+million/1891937/story.html
“The budget for River Landing has gone up for the second time this year… The total revenue from land sales adds up to more than $15 million… including Lake Placid’s $200-million River Landing Village, which the city still hasn’t secured payment for… The increase, if approved by council, would bring the total capital cost of River Landing, originally budgeted around $35 million, to $66 million.”
I think the increases are probably par for the course with construction costs over the past few years, and arguable it’s a much-needed addition and improvement to the waterfront.
August 14th, 2009 at 2:13 PM
This was too good to pass up, especially in lieu of ‘record’ home sales in July…
Reversal of fortune: Gov’t expects $1.3 billion potash revenue shortfall
http://www.thestarphoenix.com/Reversal+fortune+expects+billion+potash+revenue+shortfall/1893494/story.html
“The Saskatchewan Party government acknowledged a major reversal of fortune just over three months after releasing a big-spending provincial budget built around potash royalties… Releasing the province’s first quarter financial report, Finance Minister Rod Gantefoer said Friday that it will take in $1.3 billion less from potash than it had projected… Overall revenue has still declined by $558 million over budget, leaving a thin $50 million surplus… As well, the volume of (Potash) sales is now pegged at 600 million tonnes, far below the volumes that have occurred over the last decade.”
Now in order to balance the budget, they’ve deferred $95M on the new Children’s Hospital, delayed $30M in education infrastructure spending, reduced $49M in “vacancy management” (ie: government cost-cutting) and taking a $185M dividend from the sale of SaskFerco.
The party’s over, and we’re now in the same situation as Alberta – where instead of being more conservative with revenue projections, the SK government has spent with wanton abandon. And let’s not forget the remaining provincial labour unions that yesterday announced they expect “reasonable” wage increases with all new contracts moving forward.