Saskatoon real estate: Week in review (February 2-6 2009)
Following a month end retreat in January, the total inventory of Saskatoon real estate listings pushed higher this week and settled at 1,186 units, up from 1,124 the week before. One hundred and fifty-three residential properties were offered for sale on the Saskatoon MLS system including eighty-nine single-family homes and fifty-three condominiums to claim the largest listing week since October 6-10. House and condo listings increased fifty-four units compared to last week and gained thirty-nine units over the same week last year.
Fifty-one residential properties found a new owner, with forty-nine single-family homes and condos counted amongst them. Sales increased by three properties compared to last week, and were down by nineteen units compared to the same week last year when sixty-eight firm home sales were reported by Saskatoon real estate agents.
While the numbers suggest that overall demand is reasonable compared to longer-term averages it’s fairly hard to miss the stark differences when comparing this year’s real estate activity to last year’s numbers. Unit sales are down in five of the six weeks so far this year lagging 2008 sales by eighty-eight units. Frankly, I’m surprised that sales have been this strong given current economic conditions. I guess it’s that “Saskatchewan advantage” thing helping us keep our heads above water as some major markets deal with declines closer to 50% year-over-year. Sales may be reasonable, but to me the potentially greater concern sits on the other side of the supply and demand equation as new listings have been higher in five of six weeks this year, showing an increase of ninety-one units over the same period in 2008, and already forming some high spikes on our graph, approaching levels that we didn’t see until March last year.
Click the image for a larger version of the graph.
Forty-two price changes were recorded over the course of the week, and nineteen cancelled listings returned to the market offered at a new price.
Encouraged by another $1 million house sale, the average selling price for the week pushed higher again reaching $298,004, up from $290,407 last week and reaching its highest level since June 23-27. Remarkably, the weekly median also increased fairly significantly climbing $15,000 over last week to reach $280,000. Still, the four-week median managed to decline marginally to $264,500, down just $500 from the previous week but up about $12,000 from the same week last year. The six-week average climbed higher to $281,773, up from about $274,000 last week, and a full $26,000 higher than it was this week last year.
Click the image for a larger version of the graph.
Two lucky sellers managed a sale price which exceeded their asking price this week, but the overbids were fairly small by historical standards reaching $2,100 in case and just $100 in the other. Two other sellers managed a deal at the asking price while forty–five Saskatoon home sellers sharpened their pencil to strike a contract under list price at an average underbid of $17,018, the highest weekly underbid since December 8-12. Still, over 50% of this week’s sellers sold within $10,000 of the asking price.
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.
Norm Fisher
Royal LePage Saskatoon Real Estate
55 comments so far. We'd love to hear your thoughts.
April 16th, 2009 at 2:27 PM
FYI, that $1M sale boosted this week’s average price by more than fifteen thousand dollars.
Remove $1M from the gross sales and divide by 48 instead of 49, and you come up with ~$283.4k
(Which is still a very respectable number for mid Feb.)
April 16th, 2009 at 2:27 PM
Thanks Bookrat,
Coincidentally, I’ve just been working on trying to understand averages so your timing is perfect. I know I needed a little help with RBC’s rent to price ratio graphs, but c’mon man!
April 16th, 2009 at 2:28 PM
Thanks Bookrat,
Coincidentally, I’ve just been working on trying to understand averages so your timing is perfect. I know I needed a little help with RBC’s rent to price ratio graphs, but c’mon man!
April 16th, 2009 at 2:28 PM
Norm
Do the buyers of new homes in areas where the developers have all but stopped building have any recourse? They buy a home and see lots all around them and am sure are told that the whole place will be developed in the near future. When you drive through now you will see a family in one home and a sea of mud all around them. Given where the economy headed I suspect it could be years before these people see a house beside them.
April 16th, 2009 at 2:29 PM
Armoth,
I saw you posting previously about where the index will be in 20 years. Please research for yourself just how long-term the markets can be, 20 years does not guarantee that you will be making money.
Look at the main Japanese index, the NIKKEI 225, it hit a high of 40,000 in 1989. Today the NIKKEI is at 8,000. So after 20 years, shareholders are down 80%!
Here
Or look at the Dow Jones index. It peaked out in 1929 and did not get surpass that level until 1954. 25 years and you’re flat even. It gets better though, in 1982, 53 years later, the index hit a low point that placed it only 120% higher than the 1929 low. Basically over that 53 year period it yielded 1.5%, plus dividends.
1982 was followed by a massive 2 decade stock boom that saw the dow jones shoot up over 16x it’s 1982 level before backing off to about a 10x increase as of today.
So that is where we are at, the dow jones doubled over 53 years, and then went up 10x in the next 27 years. The stock market hardly seems like a sure shot to me.
April 16th, 2009 at 2:29 PM
Shawn,
Look at the p/e ratios at the different time periods and that is the majority of what i base my optimism on as well as some choice words by Warren Buffet yes im a blind sheep =o)
April 16th, 2009 at 2:29 PM
G,
I think it’s great that development around my house will be slow. I’m on a corner lot and I found out that the lot beside me was returned, so I may have no neighbours for quite some time. I think getting established in the new house will be smoother, and of course quieter. It’s kind of neat being the first ones on the block to welcome all those coming in. :’)
April 16th, 2009 at 2:30 PM
Armoth,
The data you provided is even worse when you figure in the inflation rate.
1929-1954 the inflation rate increased by 50% according to Stats Canada. Therefore, in a 25 year period you actually lost 50% of your purchasing power.
1929-1982 the inflation rate ran at an annual rate of 3.45%. Therefore inflation over this period increased a total of 502.13%. Which means according to your data your purchasing power fell buy 380%.
The Japan story is also evident of this. The stock market was not the only thing to peak in Japan in 1989. Real estate also peaked at this point and has continued to fall in real dollars ever since.
We will not have hit bottom in housing until people stop seeing houses as an investment.
It will have to get bad enough until people throw up on there shoes, and pack in the idea that housing is an investment.
The bubble that brings everything down is not what leads it up.
In the future housing may go up in nominal dollars but not in real dollars.
Nix
April 16th, 2009 at 2:31 PM
G,
Sorry to be so long. I doubt that there would be much a buyer could do if they did object to a lengthier development period. I expect that this is just one of the risks that you take when you buy into an undeveloped area. That said, I’ll be the city starts to work at finishing streets and selling empty lots on those streets before they open up more. They’ll make sure it’s not a massive patchwork. Costs too much to service them otherwise.
Anyone heard anything about the Jan 28 lot draw. I know some people who are going to pick a lot on Wednesday. They’re under the impression that it was fairly successful.
April 16th, 2009 at 2:31 PM
Hi:
Long-time lurker (love it), first time poster looking for advice. In regards to the downward shift in the S’toon RE market – does it make any difference when one decides to upgrade?
We have an inexpensive entry level home and want something less small (and approaching the mean price-wise). I realize that selling now and buying in 6 months or a year would make sense, but we don’t want to live like nomads so…. Trade up – spring? Summer? Fall? Next winter?
April 16th, 2009 at 2:31 PM
Nix,
So what I get from the statistics uve provided that ive covered all my bases by being in the stock market and buying my home at 25 and by being in cash and trying to time things will only make it worse. Would be cool if som1 could pull up the median house price back in 1929 =op
April 16th, 2009 at 2:32 PM
Meo:
If you believe that the market will continue to slide, then get in now, price it competitively (e.g. at or below a comparable property so that people choose yours first – the only winning strategy when there’s so much inventory) and then go for a long closing to give you time to find something else. Start looking ONLY once you have a firm sale in hand; it will give you much more flexibility to be choosy and give you a lot more bargaining power when it comes to making offers.
Just be sure that this is something that you really need, for amily or sanity or whatever… and not just a lifestyle enhancement for the sake of purchasing. Right now is not the best time to be taking on more debt if you can possibly help it, IMHO.
Just my free advice, which is worth every penny it cost you.
April 16th, 2009 at 2:32 PM
Ahh Bookrat – sage advice as always (at least based on your previous posts)! I confess I’m ambivalent about the whole idea…. jobs appear recession proof, but….
Husband HATES the house – feels it is much too small for our family of 4! Summer is coming soon though – the little house always seems less small when one has the great outdoors. Maybe I can get him to hang tough for one more winter… might have to give in on the install of an additional window to get him to agree to one more year, but…
If he does prevail over my common sense, your advice re: selling with a long closing makes very good sense.
Thank you!
April 16th, 2009 at 2:33 PM
meo,
If you believe the market will continue to slide, I suggest that you consider staying put as long as your husband can handle it there, unless there is some diminishing equity issue that might prevent you from selling in the future (declining market leaves you owing more than the home is worth). Your “upgrade” home will most likely come down more than your “small” house. Truth is, larger homes should see a larger percentage drop, but even if it’s equal, you win by waiting. For instance, a 10% drop causes your $250,000 home to drop $25K, while the $350,000 you have your eye on comes down $35K.
The only problem with a “long closing” is that it may not close at all. If the market drops a greater amount than your buyer’s deposit they’ll be better off walking, and probably will. As a seller’s agent, I am quite uncomfortable with closings that extend beyond 60 days unless the deposit is quite large. Nothing worse than having to start over three months down the road if the market has worsened. Prices mat be lower, demand could be softer. If you really want to sell high and buy lower you may need to consider the nomadic lifestyle for a time. Of course, that advice is based on the assumption that you think the market will continue to decline.
April 16th, 2009 at 2:33 PM
Hi Meo, I would also definitely echo Bookrat’s and Norm’s advice (particularly the part about running the risk of the buyer “walking” if the market change is substantial; you can always sue, but sometimes it’s like getting blood from a stone…). When we sold our home it took 6 attempts (including several “sure thing” deals that collapsed). We also found that while house-hunting in the mid-90′s that the best deals were in fact larger houses that people were willing to dump for a higher discount in order to downgrade to something more affordable, so you may find the best bargains there.
As for myself, we did sell at the peak in 2008 and are currently renting. While probably not leading a ‘nomadic’ lifestyle, we did downgrade to approximately half the square footage (even with one new addition to the family!) Truth be told, we found that we didn’t really need a lot of the possessions one accumulates through owning and upgrading over the years, and have actually found the downsizing to be quite liberating. There is a lot of truth in the old adage of keeping your wants and needs few!
Norm, as anticipated, that was a nice spike in inventory. Wondering what March is going to hold…
Armoth, cash will be king again.
April 16th, 2009 at 2:34 PM
Meo,
I would agree with Jason, in a downturn you will pay less to upgrade. Right now people think of their homes as an “investment” since they keep going up in value. As such it makes sense to buy the most you can afford. That can change. When times are bad and housing prices go nowhere for a decade or 2, big houses start to seem more like the large expenses they actually are. Hence they don’t command the same premium.
Also, if you are looking for a large house I find that the best deals can be had in highly customized houses. I’m talking of the type of house where the owners built and did the floor plan themselves. Given that they are in a more specialized market due to their size and have all these particularities which don’t match other people’s style they sometimes go for large discounts.
April 16th, 2009 at 2:36 PM
Meo,
For what it’s worth, I concur- there’s alot of good sense on this board. Timing might be less of an issue than if you’re a first time buyer, but it will require some degree of finesse.
In other news, it seems there are many “living on the edge” (especially in Alberta), and not in a good way:
Consumer bankruptcy filings surge
http://tinyurl.com/dlhkcy
Consumer bankruptcy filings surge
Article Comments (12) Globe and Mail Update
February 9, 2009 at 9:30 AM EST
“Bankruptcies among consumers are surging across Canada.
The number of consumers filing for bankruptcy in December soared 50.6 per cent, although filings fell from a month earlier, the Office of the Superintendent of Bankruptcy Canada said Monday.
While the filings spanned all regions of Canada, Alberta was highest at 106 per cent.”
April 16th, 2009 at 2:36 PM
Here’s something really strange. Canadian Real Estate Association (CREA) is predicting that house prices will fall 8% in 2009.*
http://tinyurl.com/dmkcf2
* It’s not weird that house prices will fall. It’s weird that a real estate association is predicting it.
April 16th, 2009 at 2:39 PM
I think they realize they’d lose a lot of credibility if they kept predicting gains while losses are occurring.
April 16th, 2009 at 2:49 PM
I’m back! Hope you missed me
—
“home price is expected to fall by 8 per cent in 2009 from the year before, and then stabilize in 2010.”
The article didn’t even mention Saskatchewan?. I still FEEL our economy should keep any changes moderate (even if loss). Than back in business 2010 as mentioned above.
April 16th, 2009 at 2:49 PM
L.oki,
Sounds like you’ve softened your position.
Here’s a link to CREA’s forecast. They’re predicting a 12.8% decline in unit sales and a 5% drop to the average selling price in Saskatchewan, followed by a further decline of 1% in 2010.
http://www.crea.ca/public/news_stats/pdfs/crea_forecast_feb09.pdf
I love how we got completely overlooked on the Globe’s “most modest losses” list.
April 16th, 2009 at 2:49 PM
“I love how we got completely overlooked on the Globe’s “most modest losses” list.”
That modest list in globe article was for projected percentage drop in sales, not price. Our sales drop is projected at over 10 percent, not in the club with Newfoundland and New Brunswick at 5 percent drop.
April 16th, 2009 at 2:49 PM
Reality continues to creep in, very slowly:
Housing starts way down in Saskatoon, Regina
“SASKATOON — January housing starts in Saskatoon dropped significantly compared to the same period last year, the Canada Mortgage and Housing Corp. (CMHC) is reporting.
Last month, construction began on 21 single-detached homes in the city, a drop of nearly 69 per cent from January 2008 when construction started on 67 units. Saskatoon also had 12 multi-family starts in the city in January, a far cry from the 134 multi-family starts recorded in the same period last year.
Paul Caton, the CMHC’s senior market analyst for Saskatchewan, says the high inventory level of homes in the city needs to drop before more homes are built.”
Wow. Now there’s some senior market analysis for you.
April 16th, 2009 at 2:50 PM
http://www.thestarphoenix.com/announces+million+schools+across+province/1270040/story.html
Just announced – 125 million for schools in the province this year as part of that advanced 500 million infrastructure. Homebuilders, prepare to be schoolbuilders.
April 16th, 2009 at 2:50 PM
Make that 142 million.
April 16th, 2009 at 2:51 PM
Norm, I think my first outlook was on Saskatoon not Saskatchewan(can’t remember)
To outline my position (revised or not)
We peaked last year in spring and the downslide was from there. I estimate December prices were 20% lower than April based on what I was watching (forget all the statistics which are skewed from million dollar properties)
Now in late January ’09, I have actually see competition in the market and even (although rare) multiple offers. Again, I predict some dismal housing conditions early this year, especially when this negative news selling newspapers, but once spring and summer comes, and everyone in Saskatchewan realizes we are alive, eating, and have our jobs, we should see a modest year over year (Average) gains come the end of the year.
Remember, the unemployment rate in SK is heading down, and it is forecasted to go lower. I just heard news from a Potash work that they are hiring all their temp layoff staff back in March. Brad Wall is also injecting over a billion into the economy which happens to be great timing because Stephen Harper is offering his 1/3,1/3,1/3 funding splits on infrastructure projects so our money goes even further, unlike some other provinces where they are too broke to put in their portion.
April 16th, 2009 at 2:51 PM
Mark,
“That modest list in globe article was for projected percentage drop in sales, not price.”
Thank you.
L.oki,
“Norm, I think my first outlook was on Saskatoon not Saskatchewan(can’t remember)”
I believe that’s correct. My apologies.
There’s no question that Saskatchewan continues to be in about the best position to weather this storm of all of the provinces.
April 16th, 2009 at 2:51 PM
Loki, it’s entirely possible that there could be some competition. I consider this extremely unusual, though; definitely not the norm given this type of market and perhaps limited to a local anomaly. Do note that January job losses in Canada were seasonally adjusted, so the actual losses are well over 300,000, which is considerably higher (per capita) than the US losses. And while governments are dumping a lot of money into infrastructure projects, etc. these only benefit certain aspects of the economy. There isn’t necessarily going to be a lot of spinoff for the average small business which employs the highest segment of workers in Canada, so it remains to be seen what effect (if any) this will have on the economy as a whole.
April 16th, 2009 at 2:54 PM
L.oki,
There’s no denying SK’s economy is better than many other provinces. I have also seen a fair amount of positive articles in the Star Phoenix, I haven’t seen the negativity you speak of. I disagree that RE directly correlates to the economy. While having new jobs opportunities (and good pay) in SK WOULD bring more people here, I don’t see that happening right now. If there are more and more listings and the sales aren’t there to balance the inventory it will be a buyer’s market for quite some time. In a buyer’s market prices won’t go up due to “supply and demand” dynamics. Even those who are filthy rich won’t pay more for a house than they absolutely have to.
April 16th, 2009 at 2:54 PM
L.oki,
You’re right. You never know what’s going to happen in the markets, despite EVERYONE’S opinions. In regards to the 800 Billion US stimulus, just watched Obama, looks like the Republicans are going to divide along party lines, so maybe it won’t be received with as much optimism as planned.
April 16th, 2009 at 3:04 PM
Norm, Matt, Jason, & Crikey:
Thank you all for your very wonderful advice. I think I’ve convinced the hubby to hang in there for a bit longer!
April 16th, 2009 at 3:04 PM
Disgruntled, Drinking and Nick,
Sorry, but we’re not having this conversation again here. We’re here to discuss real estate, not real estate agents. If you have an issue with another agent’s behavior please take your complaint directly to that person.
April 16th, 2009 at 3:05 PM
Carney still sees economic rebound next year
http://news.sympatico.msn.ctv.ca/abc/home/contentposting.aspx?isfa=1&feedname=CTV-TOPSTORIES_V3&showbyline=True&date=true&newsitemid=CTVNews%2f20090210%2fcarney_economy_090210
“We don’t do optimism; we don’t do pessimism; we do realism at the Bank of Canada,” Carney told MPs. “We don’t do spin.”
More than anything I would love for him to be right, I just do not see it.
April 16th, 2009 at 3:06 PM
For those in Regina (i think there’s a few of us living vicariously through Norm’s blog) the average price in January was 213,000. The realtor’s association claims it is so much lower than 240,000 in December due to ‘mix of properties sold’. Many lower end homes. Maybe. Apparantly we’re averaging 235,000 on the 60 sales so far in February.
http://www.leaderpost.com/business/Regina+home+sales+expected+decline/1271117/story.html
April 16th, 2009 at 3:06 PM
“I just do not see it”.
George, I’m with you. Considering so many of our exports go to the US, it’s getting ever scarier. It looks as if Mr. Market just can’t see the recently announced bank bailout plan working either:
Geithner Says Bank-Rescue Plans May Reach $2 Trillion
http://tinyurl.com/b2uz6h
This is supposed to be seperate from the US economic stimulus package? I’d like some of what Mr. Carney is smoking.
April 16th, 2009 at 3:07 PM
The things that struck me from Mark’s Leader Post article:
“Our supply levels are about double what they normally are. Inside the city, we’ve got over 800 listings.” — Gee, is that all? Saskatoon hasn’t been near 800 listings for almost a year now, so kwitcherbitchin!
He contradicts himself: “[The buyer is] in a better position.” “There’s lots of choice out there right now. We’re not seeing the same kind of upward pressure on prices.” but “…the average is expected to rise slightly through the year.” So, which is it – high inventory/buyer’s market, or prices going up? Doesn’t make sense to have both.
Lastly, I found it interesting that the Regina average was ‘anomalous’ on the low side due to the mix of low-end homes sold… while Saskatoon had 8 homes in excess of half a mil. I know one month’s sales do not a pattern make, but it’s always odd to see divergences like this. (Mark, are you buying all the low-end properties, bringing the sale price down?
April 16th, 2009 at 3:07 PM
Mark,
I am one of the Reginan’s you were referring to. I read that article on the LP’s website last night. I’m not too sure what to think of it. I doubt Mr. Archibald would outright lie and say the average for February so far is $235,000 so I can see that. What bothered me a little was how we only get any type of analysis from the him when the news is bad. FOr example, if the average was pushed higher in January because of several Wascana View properties selling at over a million, I don’t think he would have been as quite to point out the reasoning.
I suppose it’s his job to make things appear positive though. However I truly wish that the general public would have access to more information on housing.
Norm, forgive my ignorance, but is the MLS data owned by Realtors? Is there any way that an individual could gain access to the data on homes? Has there ever been a push in the industry to provide the public with more information? I fully understand many of the reasons why the public does not have access to the information, but just wondering if the topic has ever been discussed.
Thanks.
April 16th, 2009 at 3:07 PM
Didn’t Dave Dodge, former Bank of Canada head and now no political commitment, say that he thought it would be at least 3 years before the economy recovered?
Harper probably told Carney what to say or at least what he was allowed to!
Interesting that Carney’s predecessor has such a pesimistic outlook for the next 3 years. That has to say something about Canada’s economic prospects.
April 16th, 2009 at 3:08 PM
(Mark, are you buying all the low-end properties, bringing the sale price down?
Sigh, yes, someone has to do it. All part of my carefully plotted path towards bankruptcy.
“It looks as if Mr. Market just can’t see the recently announced bank bailout plan working either:”
Mr. Market is fickle. We’ll see how he likest the 2 trillion in guarantess etc. a few months down the road.
Also, keep in mind, the recession so far isn’t as quite as bad as some headlines may suggest. I know there’s been a lot of Great Depression talk (though less in the last few months) but we’re still not seeing the kind of job losses proportionally that we were hit with in the early 80s. Provided, you adjust for the larger work force.
http://www.theglobeandmail.com/servlet/story/LAC.20090207.RJOBSLAGGING07/TPStory/?query=recession
April 16th, 2009 at 3:08 PM
Cory, SRAR and others have monthly stats available on line. Sure some one will post the links for you shortly.
April 16th, 2009 at 3:08 PM
I will. Pretty basic, usually come out at start of each month for previous month.
http://www.reginarealtors.com/ourservices-marketstatistics.html
April 16th, 2009 at 3:09 PM
“the recession so far isn’t as quite as bad as some headlines may suggest.”
No, not so far.
I think the apparent acceleration of job losses is what’s most concerning. Good point, though, the reporting of these unemployment numbers do not tend to be reported proportionally. Percentages should be what we’re concerned about, not raw numbers. I saw an intereting set of graphs the other day that show the current unemployment numbers adjusted for population (US only, sorry):
http://tinyurl.com/crz3bd
April 16th, 2009 at 3:09 PM
Hello guys and gals, been reading the blog pretty religiously now for the last couple months, thanks norm for hosting and for mediating the forum when need be. I only wish there was a forum like this available in other cities with people willing to contribute.
Anyways without going into to many details about my situation my question is this. My mortgage is up for renewal may 1st. Bank of Canada will most likely cut rates in March. Right now my interest is fixed at 4.25 through TD which says I could get a one year now at 3.75. However a bank of Canada announcement cutting rates does not necessarily lower bank prime. With bankruptcies starting to rise I am skeptical whether a buyers morgage rates can get any better. March 20 is a long way away these days. Your thoughts, I am interested to hear.
April 16th, 2009 at 3:09 PM
IMHO, your best bet is a four or five year mortgage. A one year would be a bad idea I think. Rates may stay low all year until you have to renew, but they may not, and they are only heading higher. And in two years, we may have a lot of inflation and they might be 8 or 9 percent.
Remember, Bank of Canada determineds prime rates, which only ‘help’ determine variable mortgages, which are tied to prime rates at banks. All other fixed mortgages take their cue from the larger bond market. They have to compete with, say, all those treasury bonds being issued in the States. Some fear this will send bond yields very high, meaning mortgage yields will have to follow, meaning higher rates. The Fed Reserve in the US has hinted it may fight this by buying it’s own long term bonds back, but it’s an unpredictable affair. Fixed four and five year rates are as low as they’ll likely get. And much, much safer than a variable or 1 year fixed. Those are my thoughts. But I think most on here will agree.
April 16th, 2009 at 3:10 PM
Bales – call a broker and have them monitor the rates for you. Just taking whatever the bank offers you is not a good idea. Let the broker know what features are important to you (prepayment priviledges/low payout penalties if you’re planning to sell/ assumability), and they can shop around. That’s what they’re there for. May is far away, but the broker can usually guarantee a rate for a month or so if you need to wait to transfer your mortgage. Good luck!
Also Norm – I gotta ask. I was poking around the mls listings (in osler), and there’s property listed that was built in 2007 and never lived in, still for sale. Do you have any available numbers as to how many properties that are listed (new) are THAT old?? I was unaware that there were listings that were that old. Hopefully this isn’t the future??
April 16th, 2009 at 3:29 PM
I’m going to bang the ING drum again: you can apply directly from their website, and once you are approved they guarantee that when you actually take the mortgage you will get the lowest posted rate shown between your acceptance and start date, or within 120 days of your start date (whichever is less). Their current posted rates are 4.24% for 4-year and 4.39% for 5-year. (Norm, that’s down another .1% since last we spoke. How you doin’ with yours?)
Plus you can pay off 25% of mortgage each year, AND increase payments 25% if you choose to do so.
I have greatly enjoyed being a customer of theirs for seven years now – hassle-free and simple. (They don’t have physical banks, but seemingly in compensation they have very good phone staff and an excellent website interface.)
And I second the idea of going for a longer term right now. Those with a (prime – x)% mortgage should hang on to it for dead life, but anyone asking me about renewing right now is getting my advice to lock in.
April 16th, 2009 at 3:30 PM
Bookrat,
“He contradicts himself:”
he says he thinks the surplus inventory will be absorbed by the end of the second quarter.
Cory,
The local board owns the data. Canadians are very geeked up about privacy and that might be what primarily prevents the release of details on specific properties. That said, anyone with a ten dollar bill can find out what someone paid for a home by pulling the title.
Ringo,
Sorry, there is no way to determine that through a search of listings.
Bales,
Just did a switch to Merix (must deal with a broker). 3.75% for three years. They paid all of the fees (legal appraisal, etc) and the process has been exceptionally smooth. This particular product must fund in 45 days but may still be available when you’re ready (perhaps at a lower rate). Worth looking into. I do agree with Mark’s thinking on time lines and was having some reservations wondering if I should have gone five years. Instead, I’m going to live like a pauper for three years and try to make some headway on my balance.
April 16th, 2009 at 3:30 PM
I think the best thing ING taught us was to
“Save Your Money”
Now’s not the time to be investing in real estate, or making big purchases. How tough is it really to live within our means, let’s say for one year, and take out no credit on anything, save for the mini-van needing a new transmission because it’s GM build quality
Think any one at Cameco expected to be laid off during our “boom” and now over 400 laid off because of global slow down and commodity crash!
April 16th, 2009 at 3:30 PM
Hello,
My wife and I are first time home buyers and we really enjoy reading this blog because of all the intelligent comments and helpfull information.
We are currently looking to build a house, but given the current economic circumstances, are unsure of when to build.
I have heard (from a home builder) that as soon as lumber inventories are used up here in the city, they will have to buy lumber from the U.S (because of all the lumber mills shutting down in Canada) which will increase the price of building a house.
Is there any truth to this comment?
April 16th, 2009 at 3:31 PM
Big M,
Hmmm. I’m not an expert on lumber but I have not heard of any potential lumber shortage in Canada. If anything, I would have assumed a bit of a surplus. Most of our lumber goes to the U.S. and I don’t imagine that they are buying a lot of it these days. Anyone else?
On cost of construction, this article from the Globe stating the costs have declined for the third consecutive month. Apparently, Saskatoon took a fairly large drop. Falling labour costs get the credit.
http://tinyurl.com/agobbc
April 16th, 2009 at 3:31 PM
Big M,
I wouldn’t buy into that logic, consider:
First, a relatively small component of your house cost is for lumber. Windows, flooring, kitchen cabinets, basically all of the pre-manufactured stuff is what costs money. Labor is also another big component which obviously won’t be affected by the supply of lumber.
Second, we still have mills in Canada but they are extremely unprofitable right now and running lean. Should supply magically increase they could increase supply.
Third, even ignoring the last 2 comments, should we need to buy lumber from the US we are going to get a good deal. There lumber companies are in the same spot and it is a very competitive market. Prices are not going to go up by 20 or 30% just because we have to buy from the US.
April 16th, 2009 at 3:31 PM
Big M, I agree, sounds like BS to me.
April 16th, 2009 at 3:32 PM
Big M,
Find yourself another builder! LoL
Norm,
You said 0.7% is a big drop? The way building costs have risen due to labour I’d expect it’ll be forced to come down at minimum 15%.
April 16th, 2009 at 3:32 PM
Big M – very interesting comment from the builder. My husband and I were considering moving up and building a new home. We were working with a builder starting in June 08. When the prices started dropping – we had a meeting with them in October (we had not signed a contract yet). We new that the price of the house we owned had dropped and were asking for a similair percentage drop in the price of building a new house. The builder told us that #1 the recession was not going to impact Saskatoon #2 that if we waited until January their lumber prices were going up and the price they were currently quoting us would rise.
We have subsquently decided not to build at this time (although we would like to in the future) We have decided to wait until there is a stabilization period.
April 16th, 2009 at 3:32 PM
Heather,
“You said 0.7% is a big drop?”
What I should have said was “highlighted as one of the larger drops.”
No, not “big” but it was a month-over-month drop so not peanuts either.