Saskatoon real estate: Week in review (December 15-19 2008)
It was a far stronger week than I had expected. Perhaps Saskatoon real estate buyers were in the Christmas spirit. Overall, sellers had a better week than they did the previous week with stronger sales, higher prices and smaller underbids. Oddly, multiple offers were received on a number of properties. I am familiar with four instances where more than one buyer attempted to buy the same home. Two of the four sellers low-balled their asking price and tried the old “delayed presentation of offers” approach. Both of those properties found a number of willing bidders. One of the homes is firmly sold with a $13,000 overbid, while the other is under contract pending removal of conditions.
Through the course of the week 49 sellers in the residential category placed a sold sign on their property, up three from the week before, but down roughly 20% compared to the same week last year. Included in those unit sales were 31 single-family homes and 15 condominiums. Total residential unit sales to date in December finished the week at 131. Sales will almost certainly slow through the balance of December and there’s little doubt that we will finish the month below last year’s figure of 210 units, but it’s looking like we’ll close the month above the five-year average of 157 units, making December a far better month than we’ve seen in some time.
New listings also increased over the previous week. 62 residential properties were offered for sale on the Saskatoon MLS including 48 detached houses and 12 condominiums. Additionally, 13 of 28 properties that processed a cancellation came back as a new listing. Total active listings continued to decline for the eighth week in a row finishing down by 50 units at 1,328 including 811 single-family homes and 435 condominiums. Active listings may well slip below 1,200 units by the first of January when, based on historical trends, we can expect to see the inventory begin to grow again.
Click the image for a larger version of the graph.
In spite of the fact that condominium sales took a larger than typical share of the market (over 32%) once again, the average selling price of a Saskatoon home (houses and condos) bounced back more than $40,000 this week to finish at $290,715. The six-week average increased marginally from $275,914 last week to $279,240. Following a fairly significant slide last week, the four-week median inched down to $255,000 from $256,250 the week before.
Click the image for a larger version of the graph.
Month to date, the average selling price in the entire residential category is $270,756, up nearly 6% from last December, but down roughly 3% from the final average of $278,495 in November. Perhaps more interesting, the average selling price of a Saskatoon house is sharply lower through the first two-thirds of December than it was in November sitting at just $279,057, down from $302,508. Condos are averaging $246,475 compared to just $222,834 last month. Certainly, condo prices are driven higher by a handful of luxury sales, but even if I remove four units at the high end and the low end we see a marginal increase in the average sale price. I suppose a lot could still change between now and the end of the month but I look forward to diving into these numbers a little deeper.
The average underbid was nearly 22% lower than last week moving from $19,717 to $15,455. Approximately 81% of all sales were wrapped up within $15,000 of the asking price compared to just 62% the week before. The most significant changes occur at the upper end of the underbids chart with the $10-15K category ballooning, the $15-20K category disappearing altogether, while the $20-25K and the plus $25 category both shrunk.
It’s also interesting to note that 6 of 46 house and condo sales were reported at, or above the asking price. Hardly indicative of a trend, but just the same, it’s the highest percentage we’ve seen since the week of September 22-26.
As my family celebrates Christmas this will likely be my last post until next weekend. I’d like to wish you all the best of the holiday season. I hope it proves to be a happy time for you.
Thank you again for reading.
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.
Follow our daily updates on Twitter @SaskatoonHomes.
Norm Fisher
Royal LePage Saskatoon Real Estate
32 comments so far. We'd love to hear your thoughts.
April 23rd, 2009 at 8:59 AM
Thanks Norm. I don’t really comment much here anymore but I follow your blog on a week-by-week basis. I hope this blog helps drive as much business to you as possible and that 2009 is a banner year.
April 23rd, 2009 at 8:59 AM
Interesting we see a reasonable increase in listings … wonder if we could say a wave of this available inventory trying to unload itself? If prices increase a little, a flood of new listings trying to jump in at the higher prices while they last would not surprise me.
The almost 1,000 Saskatoon area Potash Corp lay offs again points out why caution may be the name of the game in the near future. Even for a few months, that is a lot of lost income for the north half of the province. Maybe people will finally reign in their record holiday spending?
Tough to feel bad for some one who was laid off who was spending 13% more over the past year, when their raise was only 4%. Will be interesting to see how they pay off that new LCD TV.
April 23rd, 2009 at 8:59 AM
Wow Norm, that is somewhat surprising (and at the same time, intriguing)… Were these SFH or condos? What area(s)? How much did they “low-ball” their asking price (I assume this is in relation to other similar homes in the area), and were these brand new listings or cancellations/re-listings? Final question, how many days on market were each prior to the sale?
April 23rd, 2009 at 9:00 AM
Todd,
Nice to hear from you. I’m glad that you’re still coming around. Appreciate the well wishes. Best to you as well.
Jason,
Only one of those is firm at this point. It is a new townhouse priced at $226,900 and selling $13K over asking. First time listed and lasted just a few days, until the “offer presentation” time.
April 23rd, 2009 at 9:00 AM
Norm,
I just want to say thanks for all the great stats and commentary every week. I know that it takes a lot of time and hope that it results in more business for you. I am looking forward to your 2008 wrapup post in early January. Will you stick your neck out and make a prediction or two for 2009??
Have a great Christmas – Roger
April 23rd, 2009 at 9:00 AM
I’m sure there will be more buyers this winter trying to get good deals out of desperate sellers. (moving out of town, two mortgages, etc.) There will also be many newly-built homes completed for spring, owners will have to sell their existing properties.
Merry Christmas Norm!
April 23rd, 2009 at 9:01 AM
Thanks Roger. Merry Christmas to you to.
“Will you stick your neck out and make a prediction or two for 2009??”
I don’t know. Have to see how brave I’m feeling in January. I may predict which predictions are going to be wrong. That’s always easier.
Merry Christmas Heather!
April 23rd, 2009 at 9:04 AM
Thanks for the update Norm. I just bought a house in July and it is really a pain in the ass to see price dropped drastically in recent months (I bought the house to live not for investment). I hope the price could rebound soon, well, at least no further drop.
April 23rd, 2009 at 9:06 AM
Well, seems Saskatoon is following Edmonton, not as bad though. My house in Edmonton is now selling for 26% less than our peak. Considering Sask has gone up in price faster and more than Edmonton, yikes.. I was looking at Sask, but my same quality house costs more there than Edmonton!!!, and I’d make less….
Here is what I’ve seen:
Edmonton price increase over 1,2,3,4 years = -2,32,70,84% as opposed to the higher
Saskatoon price increase over 1,2,3,4 years = 24,79,99,117%.. Is Sask justified to be more expensive than Alberta? Your wages are lower, am I missing something?
April 23rd, 2009 at 9:11 AM
I come across this ad in a local classified site in Regina. According to the ad we are not in a buyers or a sellers market but in a realtors market.
Need an agent you can trust?
When opportunity knocks will YOU be ready?
Sellers take advantage of the opportunity to sell now. You may have noticed the SOLD signs popping up everywhere. Homes are moving quickly now. With a delayed possession date it will give you an opportunity to find a home before the spring rush reaches a fevered pitch. YOU will be ready because your home has already SOLD.
Renters why let YOUR landlord get rich with YOUR money? The market is flooded with a variety of listings to choose from to fit ANY budget. Make YOUR money start working for YOU. Start the move towards the reality of purchasing your own home now.
For Sale by Owners are you frustrated with unqualified buyers taking up your precious time? Not being available for family and friendship outings this holiday season because you must rush home to show your house? Take a break and let a professional handle all the details. Call now and get YOUR home SOLD!
April 23rd, 2009 at 9:13 AM
Hey Mike,
That’s quite a pitch you dug up there. Well, you never know.
April 23rd, 2009 at 9:17 AM
Jd,
I agree with you 100% that Edmonton is a lot more attractive place to live right now than Saskatoon. It has nice people, a vibrant arts scene, lots of downtown amenities, higher wages, and a much more affordable cost of living. I foolishly used to be very pro-Saskatchewan, and never would have dreamed of joining the leagues of my peers who migrated to Albert right out of school, but after living there for about six months now, I can honestly say that this was one of the biggest mistakes I have made in my life. Looking back I am now thankful for the Sask-a-boom and its associated cost of living increases. Had it not been for rents almost doubling in the period of two years, I wouldn’t have left to find a better job, better living accomodations, and most of all, a better quality of life in Edmonton.
Mike,
That ad is comedy gold.
April 23rd, 2009 at 9:18 AM
jd,
I am in the process of relocating from Edmonton to Saskatoon, and I noticed the same trends. And yeah, I would agree that the same quality house is listed higher in Saskatoon then Edmonton.
Fortunately I will be making more in Saskatoon. But then there is the taxes: income tax, PST, and property tax are all higher!
Anyway, I’m hoping that the prices are going to come down 10% or so and I will buy in the fall. Hopefully finding a place to rent (3-4 bdrm house) won’t be that hard to find.
April 23rd, 2009 at 9:20 AM
“Fortunately I will be making more in Saskatoon.”
Interesting that you mentioned this.
I moved back home (to Saskatoon) from Calgary about 2 years ago and accepted a 40% increase in annual income. And I had to fight for my position in Calgary.
I am currently looking to upgrade but unsure of the market conditions and disappointed by the quality of inventory in Saskatoon right now. Lot’s of listings, but so many of them are on busy streets or need extensive upgrading.
Norm . . . love the reporting. Thanks!
April 23rd, 2009 at 9:21 AM
Please in-depth information, nice to see the market in Saskatchewan is still relatively healthy.
Rich Mundle
April 23rd, 2009 at 9:21 AM
At the end of November, I wrote:
“I think that November was shortchanged a little by the way the business days fell on the calendar this year, but maybe it’ll help the December numbers? Either way, I will now go on record as predicting in December sales in the 120s… or lower (ouch).”
Well, here it is just ending the 3rd sales week of the month, and already 125 sales. That’s pretty darn good so far… and I wonder, *did* December benefit from November being shortchanged?
Anyway, I concede my prediction being wrong just as gracefully as Norm did … although Norm can’t exactly say that he was ‘right’ either, since I don’t recall hearing a prediction from him.
I’ll leave you with a couple more numbers to wrap your minds around. All numbers are using 2004-2008 aggregate data.
2 sales needed to beat worst previous Dec sales(127, 2004)
30 sales needed to beat median (155)
14 sales needed reach 1000 total sales Aug-Dec
84 sales needed to equal previous worst total sales Aug-Dec (1075, 2004)
273 sales needed to equal Aug-Dec median sales (1264)
I’ll go out on a real sturdy limb and say that we’re not gonna make that Aug-Dec median. The limb marked ‘not gonna beat previous worse’ looks pretty sturdy, but I’m not getting fooled twice.
Merry Christmas to all…
April 23rd, 2009 at 9:23 AM
Norm I *really* wish you had an ‘edit’ function. Heck, I’ll settle for a ‘preview’ function. Pretty please? I’ve been good, and it’s all I’m asking you for Christmas…
I’m wondering about two things:
#1:
“Total residential unit sales to date in December finished the week at 131…”
One of us is missing something, or one of us needs to re-take math…
Dec 01-05: 34
Dec 08-12: 45
Dec 15-21: 46
How do you mane 34 + 45 + 46 = 131?
#2: $384k average sale price on 6 houses in area 3? That *definitely* pulled the numbers up. That’s the highest weekly average for this area EVER, obliterating the previous high-water mark of $348k … and no comment as to why? What gives — someone buy up a whole block of Whiteswan Drive?
April 23rd, 2009 at 9:24 AM
Golden Dancer,
Thank you for the feedback.
Bookrat,
“Anyway, I concede my prediction being wrong just as gracefully as Norm did … although Norm can’t exactly say that he was ‘right’ either, since I don’t recall hearing a prediction from him.
”
I don’t find much joy in being right. Even less in being wrong. These month to month guesses are noting but a crap shoot.
“August-December”
How long did you have to crunch numbers to come up with the worst possible scenario?
“One of us is missing something, or one of us needs to re-take math…”
Yes, you are missing something.
Your math skills are fine, and so are mine. We can both agree that those numbers don’t total 131.
The “Week in review” specifically deals with single-family homes and condominium sales. As of the close of business Friday there were exactly 125 condo and SF sales. 131 is for the “total residential” unit sales which includes duplexes, semi-detached dwellings, mobile dwellings and vacant lots. All of the monthly numbers that you are comparing represent “total residential unit sales.” Today, total residential sales for December come in at 146. The MLS is closed for the balance of the week so 15 sales will be all she wrote for this week, but we’ll probably have quite a few reported over the last three days of the month. We only need 12 more units to make it the “second best December on record.”
“$384k average sale price on 6 houses in area 3? That *definitely* pulled the numbers up. That’s the highest weekly average for this area EVER, obliterating the previous high-water mark of $348k … and no comment as to why? What gives?”
Two condo sales on Spadina, one at $595K and another at $365K. SF’s at $435K, $370K, $350K. One condo at $210K.
I’m telling you man, this market is really taking off. If you’re thinking of buying, you best get on it before we hit that “fevered pitch.” Mike wouldn’t have said it if it were not true.
“Norm I *really* wish you had an ‘edit’ function.”
I also wish I had an edit function but I don’t know how to build one.
April 23rd, 2009 at 9:25 AM
Good news or not? It’s all about perspective, I suppose:
http://tinyurl.com/9r4cqz
OTTAWA – Virtually all provinces will see their economies shrink next year, with Ontario and Alberta suffering a near two per cent contraction and with only Saskatchewan posting any growth at all, and even that just a marginal 0.6%, a major Canadian bank forecast Tuesday.
“As Canada slides into recession, no region will be immune, TD Bank warned, adding that promised government stimulus can cushion the fall into recession but can’t stop it.
For homeowners, there’s more bad news, however, with home prices projected to fall more than 10% next year, on top of this year’s 2.1% dip, and then edging up by just 0.5% in 2010. Provincially, the steepest drops in home prices next year will be 15.6% in British Columbia and 14.6% in Alberta.”
Is the “promised government stimulus” yet to be announced, or did I miss it?
April 23rd, 2009 at 9:26 AM
Thanks Crikey,
For those interested in reading the entire “Provincial Economic Outlook” from TD Economics.
http://www.td.com/economics/qef/prov1208.pdf
Interesting that TD is predicting an 8% price decline for homes in Saskatchewan, below the predicted loss of 10% nationally.
April 23rd, 2009 at 9:29 AM
Flaherty promises a short deficit http://business.theglobeandmail.com/servlet/story/RTGAM.20081223.wflaherty24/BNStory/Business/home?cid=al_gam_mostview
And just a few months ago everything was fine according to this guy?
Nobody really knows what is going to really happen in the next few years, but I will go out on a limb and say my future kids will pay more taxes than I do. This will be the result of the increase in our national debt due to all of the upcoming bailouts, stimulus and deficit spending we will see our government put forth.
April 23rd, 2009 at 9:31 AM
Fed Destined To Become World’s Largest Auto Dealership http://globaleconomicanalysis.blogspot.com/2008/12/fed-destined-to-become-worlds-largest.html
Hundreds, if not thousands of of auto dealerships will fail. They will fail because they over-expanded in response to fake economic signals coming from the Fed, just as the auto manufacturers did and the housing industry did.
Housing purchases that could have and should have taken place over a period of a couple of decades were crammed into a few short years as lending standards dropped to keep the Ponzi scheme going. Flush with the feeling of fake prosperity from rising home prices, consumers bought cars, trucks, and SUVs with the same reckless abandon as they bought houses.
April 23rd, 2009 at 9:32 AM
George,
I think we will be getting our extended warranties from the Feds in the future. All I know is i’m not happy our tax dollars are going towards GM/Chrysler. I get this feeling that these car companies will be in the exact same shape at the end of March and we will be giving them more money then. The US bailout is also not the first time the Feds have given them free money either. (yeah, it’s not supposed to be free but they’ll never recover it).
Armoth,
Any good tips out there? I see some stocks getting even more attractive out there but anything commercial real estate is getting scary. That XRE had the dividend cut by 40% today. I may hold off on this one for a while.
I am looking at oil stocks too but i believe BQI needs to be invested with USD.
April 23rd, 2009 at 9:32 AM
Merry Christmas all! so a short post.
Local Media spins 3 rd best job creation in Canada, and wage growth that still trails Alberta (and Nova Scotia) to again come in at 3 rd best, as well as current wages at # 4 (out of 10) behind Alberta, BC and Ontario. With Alberta continuing to spread the wage gap (with lower taxes and house prices on the way down) # 3 or # 4 out of 10 sure sounds pretty average. A 0.6% wage increase above inflation? Big deal. Not exactly “boom” worthy. And this is BEFORE the layoffs in Uranium and Potash recently announced.
http://www.leaderpost.com/business/Wages+numbers+Saskatchewan+continue+climb/1105902/story.html
Not sure # 3 or # 4 in a recession is anything to be proud of.
And I too find it funny that Flaherty and Harper go from promising NO deficit, to $30 Billion in a few short months… kind of like the Leader Post, either dishonest, or really just a bit slower than the rest of us. I guess I have to hope for a dishonest government, over an incompetent one during this recession!
April 23rd, 2009 at 9:32 AM
norm, a 8 % drop in Saskatchewan house prices sounds about right, maybe more than 10% for more over valued Saskatoon?
“84 sales needed to equal previous worst total sales Aug-Dec (1075, 2004)273 sales needed to equal Aug-Dec median sales (1264)” touche bookrat, down turn is here
April 23rd, 2009 at 9:33 AM
“Alberta’s growth = Saskatchewan total population”
for the last 18 or 19 years from the bench site
puts all our “growth” in perspective
April 23rd, 2009 at 9:33 AM
Hello All- I hope everyone is having a great holiday season!
I noticed this in a NYT article and thought it was really interesting:
No Furnaces but Heat Aplenty in ‘Passive Houses’
http://tinyurl.com/8xk2x2
DARMSTADT, Germany — From the outside, there is nothing unusual about the stylish new gray and orange row houses in the Kranichstein District, with wreaths on the doors and Christmas lights twinkling through a freezing drizzle. But these houses are part of a revolution in building design: There are no drafts, no cold tile floors, no snuggling under blankets until the furnace kicks in. There is, in fact, no furnace.
Apparently these types of houses only cost 5-7% more to build than traditional houses. Is anyone aware of a company that offers anything similar in Canada?
April 23rd, 2009 at 9:33 AM
Crikey, neat article… but you’re mis-stating what it says a little bit.
“IN GERMANY (emphasis mine), passive houses cost only about 5 to 7 percent more to build than conventional houses.”
Any idea what the base cost is to build a house in Germany compared to a similar house in Saskatoon/Canada? I have heard that it’s significantly higher.
The article also states plainly that building similar houses in the USA (and, I assume, in Canada) is likely to be more expensive:
“… the sophisticated windows and heat-exchange ventilation systems needed to make passive houses work properly are not readily available in the United States. So the construction of passive houses in the United States, at least initially, is likely to entail a higher price differential.”
They also talk about the lack of ventilation systems in USAian houses… but maybe Canadian houses are built slightly differently?
Still, would sure be nice to see it as an option. I’m sure that some people would be willing to pay more up front for lower long-term costs.
April 23rd, 2009 at 9:33 AM
Bookrat,
I apologize, I didn’t intend to mis-state anything- all that turkey is affecting my reading comprehension abilities, perhaps.
“Any idea what the base cost is to build a house in Germany compared to a similar house in Saskatoon/Canada? I have heard that it’s significantly higher.”
I honestly don’t know the details. You may very well be right. It makes sense that if the materials are not readily available here, the cost would be higher.
This link is to the German website, which has some cost information (with costs in DM and Euros) if you’re interested:
http://www.passiv.de/
As it turns out, there is a similar institute in the US (based in Illinois, I believe). They seem to approximate that the upfront cost would be in the order of 10% higher than traditional construction:
http://www.passivehouse.us/passiveHouse/FAQ.html
“Still, would sure be nice to see it as an option. I’m sure that some people would be willing to pay more up front for lower long-term costs.”
I completely agree. I’m one of those people.
April 23rd, 2009 at 9:43 AM
Crikey,
Cool story. Lots of exciting stuff happening in new home construction. It will be interesting to see what kinds of technologies are used in “Rosewood” which is supposed to be Saskatoon’s first “green” subdivision.
“Heat-exchange ventilation systems” are used here, but they’re generally optional and obviously don’t work as efficiently as the ones in this story.
April 23rd, 2009 at 9:45 AM
Vinny,
Right now im just doing as much as I can into the TSX 60 index if I have more money than my goal amount into TSX 60 I was looking at BMO, RY, TD and Riocan. Im only taking small positions just incase things get worse from here. Luckily Brad Wall a man who I admire and trust planned perfectly for this downturn and you will see Saskatchewan be the promised land for many. Not only in real estate but in the job market as well. Happy Belated Christmas every1!
April 23rd, 2009 at 9:45 AM
Brad Wall does actually seem like a decent down to earth guy – not sure if the 35% raise to nurses the year before the commodity crash was a great idea!
And really, crashing oil, forestry, uranium and farming are kind of beyond Wall’s control.
Let’s hope he holds the line on other raises – without spiting all the other health professionals who are in more demand than nurses, and reasonably expect 35% too! (doctors, pharmacists, physical therapists, technologists in hospital, etc.)