Saskatoon real estate week in review: February 22-26 2010
Firmly completed Saskatoon real estate sales took a small downturn compared to last week, slipping three to forty-eight house and condo sales, just one unit ahead of the same week last year.
New listings of Saskatoon homes remained stable on a week-over-week basis coming in at ninety-seven properties, twenty-one fewer than were offered for sale during the same week last year.
Some of the agents that I’ve been in contact with lately have complained, “Things have slowed in the past couple of weeks.” If the ultimate measure of a market is units traded, then a slowing is clear in the recent sale numbers, which have been following last February’s frightening trend when unit sales fell forty-two percent compared to the previous February and finished twenty percent lower than the five-year average. At the same time, new listings are also lagging well behind last year’s numbers for seven of the eight past weeks. It is a bit difficult to tell if softer sales are a result of lower demand or a tight inventory of good homes.
In any case, demand does continue to trump supply in the lower price ranges. Most decent homes that are realistically priced between $250,000 and $350,000 are likely to find a buyer in a reasonable period of time, perhaps even attracting a few good prospects.
Active Saskatoon real estate listings continued on a seasonal upward swing climbing for the fourth consecutive week to 835 properties including 480 single-family homes and 314 condominiums. While inventory climbed and sales were weaker than normal, the overall supply and demand equation added up to less selection for home buyers as the total estimated time required to exhaust supply (total inventory divided by the last months sales) dropped to about three and one half months, from over four months at the close of January. Like last week, nearly all of the inventory gains were in single-family homes category, which grew by thirty-one while the condo category picked up just five. Last year at this time there were 785 houses for sale, 429 condos, and a total residential inventory of 1,298 properties could be found on the Saskatoon multiple listing service.
Cancelled and withdrawn listings came in low again at just sixteen units. Nine of those later re-appeared as a “new listing,” seven available at a lower price while two asked for a little more. Total price adjustments came in at thirty-four with two moving higher and thirty-four adjusting their price down.
After two weeks in the clouds, the average selling price of a Saskatoon home tumbled over thirty-five thousand dollars from the previous week to finish at $276,201. The six-week average moved ahead three thousand dollars from the week before to $289,430 showing growth of about seven thousand dollars over the same week in 2009. The four-week median saw similar weekly gains finishing at $288,500 and trumping last year’s number by close to twenty-five thousand dollars.
Click the image for a larger version of the graph.
Overbidding picked up a bit of steam again with seven sales being reported above list price by an average of $9,928. Four of the seven overbid sales were new townhouse condos. They reported the largest overbids with a couple approaching $25,000 and those sales could very well have included extra development or improvements that were not reflected in the asking price. The three single-family homes that were in the mix were all priced well below the average ($155,000 – $194,900 and $249,900) and attracted average overbids of just $2,233. An additional four homes traded at list and thirty-seven of forty-eight sales went for less than the list price by an average of $7,941 or about 2.8% off of the asking price.
Highlights from the news this week
Housing market likely to grow
New rules won’t put lid on prices
Budget won’t include new spending or tax measures
Sharp, quick rate increase needed: C.D. Howe
Record low interest rates still needed: Bernanke
U.S. new-home sales plummet
Forecast bullish for builders
Few listings mean tight spring market: Remax
Canada resale home price index up for 8th month
Housing market humming
C.D. Howe wants sign on pace of Canada rate increases
A cooler take on house prices
Home builders’ association honours residential developers in Saskatoon
A map displaying the boundaries of Saskatoon real estate areas is here.
An overview of data collection and calculation practices for our statistical reports is here.
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
41 comments so far. We'd love to hear your thoughts.
February 27th, 2010 at 4:05 PM
Hey,
I need to make a decision on my mortgage in a bit. Stay with variable or 5 year fixed. If I lock into a 5 year rate at 3.75%, I’ll be paying 2% more right off the bat compared to my variable rate. By comparing payments on a five year fixed rate to a variable rate that I believe will slowly increase in 5 years, I think I can pay more off with the variable rate.
My reasoning is that record household debt will keep inflation low and keep rates low as well. A huge increase in rates would be detrimental to Canadians households and the economy. Not as low as now, but does anybody see prime at 6% in 5 years? Inflation running wild?
Oh by the way, great website Norm!
Thanks
February 27th, 2010 at 10:43 PM
I think the website is great and one of the best I have come across.
I have to comment on the state of living in Saskatchewan from a young professionals perspective. This place has become completely unaffordable. With the bubble that is in the making for the whole country, I would rather rent then have to pay back a serious loss. The problem is, renting is out of control. This city is going to have serious issues if they do not deal with this issue ASAP. I bet that the university enrollment rate drops 4 years past the peak of real estate (rental costs) and students (who make up a large majority of the market) start going else where. It is terrible for the province but the cost of living advantage that was previously here is now gone. The university has realized this (with the announcement of a few more residences) but I do not think it will make up for this.
I constantly hear people thinking they can charge outrageous amounts for rent. “Saskatoon is a land lords dream” is the common saying. I hear it from everyone. Then you ask if they would ever pay $X amount for rent and they say “hell no”, but think students and low income people can afford it. This city needs a serious correction in the real estate. I am getting sick of the cheerleaders who think that everything can only go up (when in fact we have learned this exact lesson through the recession). I hope some people lose their hats for this.
I don’t expect a real estate agent to keep this on his forum very long.
February 28th, 2010 at 12:00 AM
Scott,
The new residences at the U of S don’t look like they’ll be cheap either. With four occupants to a suite, and at $500 a pop, I don’t think they’ll be much of an alternative at least for reducing costs.
You mention “the bubble that is in the making for the whole country” but you feel that Saskatoon is “going to have serious issues.” Do you feel it’s much worse here than it is elsewhere? I’d be curious to hear your ideas on how the city could “deal with” high rents.
“This city needs a serious correction in the real estate.”
If that is so, then it will happen. These things run in cycles that have a beginning and an end. We are somewhat fortunate not to have seen big run ups over the past year while the national average has increased nearly 20%. Of course, the big contributing factor to sustaining these prices is interest rates. Even at these prices, which are well above traditional “affordability measures,” real estate looks pretty affordable because payments are reasonably low at current rates. A 300,000 mortgage at today’s 5-year rate (3.69) available through a broker is $1270 on a 35-year amortization.Throw in a couple hundred bucks for taxes and you’re probably still lower than the rent for something comparable. Of course, those rates won’t be available forever and when they return to historical norms (6-6.5) that same mortgage will cost closer to $1800 a month and then you have some real affordability problems.
“I don’t expect a real estate agent to keep this on his forum very long.”
There have been dozens and dozens of discussions along these lines on this blog. Of nearly 14,000 comments we’ve received over a period of a few years not more than a couple of dozen have hit the trash bin. Most of those were written by sock puppets, trolls, or racists. Your comment will be here as long as this website is.
I appreciate having the opportunity to hear your thoughts.
February 28th, 2010 at 12:07 AM
Doug,
I think it may take awhile longer than we initially thought for rates to find their way back up, at least substantially, but it’s nothing more than a wild-ass guess and a gut feeling on my part. Your thinking makes sense to me.
Good luck.
February 28th, 2010 at 1:00 AM
Scott, I think young people in Saskatoon have to suck it up and move. Seriously. Saskatoon is expensive. More expensive than most (yes a handful of other Canadian markets are more). The university is mediocre at best and despite steady increases, Alberta and Regina pay more.
I moved to Regina.
Maybe time others sucked it up for a year or two, got a room mate in Saskatoon, and when graduated, they come down here, or move to Red Deer, or Winnipeg, or interior BC, or every where in Ontario other than Toronto… all are cheaper to live than Saskatoon, now for 2 years and running.
And Norm, please tell me you are not advocating a 35 year mortgage as a rent substitute… people buying beyond their means is what got us into this mess in the first place!
February 28th, 2010 at 1:09 AM
I think there is a point that is being missed in all this rate speculation. Mortgages are the only “loans” with a low rate. Go get a loan for a boat or RV and see what the rate is. BofC prime is not the rate that banks are basing rates on. The only way you can get close to that is to use a HELOC and why someone would actually put up their home as collateral for a boat is…well, insane. Banks love HELOC’s. Check the legal implications to find out why. They DON’T lose, ever.
Canadian and American Gov’t are running in the red…and out of money. How do they service that? By issuing bonds. There hasn’t been great activity in that market because the return sucks. How does the gov’t's get investors to buy more bonds? Give a better rate of return. Mortgage rates are based on the bond market. When the bond market heats up because of better interest rates, watch your mortgage rates go up. Household debt being at historic highs has no relevance and the gov’t will be helpless…and so will those with 5% down and a 35 or 40 year mortgage. I think this summer, the climb back to historic averages begins
February 28th, 2010 at 7:39 AM
Here is a site that offers statistics on indicators for provincial jurisdictions. There may be a similar site in English but this French site does offer debt and deficit information on all provinces, for example, in table format. The average personal disposable income figures are also relevant to the discussion.
http://www.stat.gouv.qc.ca/donstat/econm_finnc/conjn_econm/T... – 36k – Similar pages
In short, the data as reported suggest that provincial debt in Saskatchewan is among the lowest in Canada, taxes are similarly relatively low, and personal disposable income in Saskatchewan is among the highest in Canada. Given that house prices are below the Canadian average in Saskatchewan, the unaffordability argument is probably more relevant elsewhere than in Saskatchewan. However, the point is noted that some markets may be more affordable, even when property taxes, provincial taxes, sales taxes and available income in considered. The question is: on the basis of what data have those markets been identified?
February 28th, 2010 at 8:20 AM
The link above will get you to the site but you will need to navigate to: `Comparaisons interprovinciales` for tables on comparisons between provinces. Please note that the first table in each section is highlighted but all tables are available.
February 28th, 2010 at 8:40 AM
Nick,
No, I’m not “advocating” for any particular mortgage term as a comparison to the cost of rent. I’m discussing why prices seem to have been sustained up until now, and why they’ve been able to increase beyond traditional measures of affordability. Clearly the market is using the 35 year mortgage in a big way. That, and the added factor of low interest rates have made the cost of housing relatively cheap in the short term.
February 28th, 2010 at 9:09 AM
Provincial,
We’d appreciate it if you don’t mess up this discussion with facts and statistics.
Truth is, housing prices in Canada have risen far faster than incomes and when young people like Nick and Scott start running out of paycheck faster and faster all of the time, it’s frustrating. People who are earning at or below the median don’t have a lot of great options. They will have fewer options when rates do go back up to historical levels.
It seems to me though that this problem is not unique to Saskatchewan, even though we have seen some of the biggest changes in house prices. Yes, you can probably save a little cash by moving to Regina, but for the most part housing is expensive everywhere.
Here is the direct link to the Comparaisons interprovinciales tables index which you referenced: http://www.stat.gouv.qc.ca/donstat/econm_finnc/conjn_econm/TSC/index.htm
February 28th, 2010 at 9:14 AM
Westcanguy and Norm, thanks for responding.
I’ll admit that I don’t understand the mortgage market completely. I do understand that the bond market determines mortgages, but is that just for the fixed rates?
I thought that the prime ( variable rate) is kinda dependant on inflation. That is what I understand when Carney talks about increasing the Canada Bank rate up if inflation goes above 2% before July. After July, I do see some jumps in my variable rate. These emergency rates can not stay low for a long time. By Fall of 2011, I would not be surprised to see a 2% increase in my variable rate taking it to 3.65. I guess it depends on the risk I am willing to take.
February 28th, 2010 at 9:17 AM
Norm you seem like one honest dude.
February 28th, 2010 at 10:12 AM
Doug,
Royal Bank is predicting prime at 5.5% by end of 2011, sorry I don’t have the link. On the flip side, Goldman Sachs in the US is predicting American prime to go basically nowhere for at least 2 years, American and Canadian Primes are generally close so this reflects on us as well. So you have 2 major financial instituions with 2 very different outlooks. Basically it’s anyone’s guess, 2 many factors to predict. I would just make sure that if prime DOES go up to 6 or 7 or 8% in 5 years you are not going to be in a position that you have to sell.
February 28th, 2010 at 11:52 AM
After reading Provincial’s post, I just feel the whole Canada needs some correction…
Actually I think Europe and China are facing the same situation and are all kind of following the steps of the States, or say, Japan 20 years ago. Hopefully not that bad. Just personal opinion…
I heard people say comparing to the 70′s, we are making less money now.
February 28th, 2010 at 9:48 PM
We are exactly the couple Scott is speaking about. We are two young professionals with post secondary education and experience. We came from out of province to Saskatoon after my husband was head hunted here in the summer of 2007. We fell in love with the city right away and didn’t realize the bubble we were walking into.
Fast forward 2 1/2 years later, we lost a house to an overbidding war in summer 2008 when CMHC quashed the mortgage at the last minute due to our over paying (which we were) and in the course of that drama / trauma our rent has increased $100 short of DOUBLE what it was. That’s right, for our downtown apartment our rent has increased with every opportunity until we are now nearly at double the cost. For the record, our bathroom is still a lovely yellow only found in 1970s decor.
Our solution to the mess? We will pay rent another year here and then take our bank account, our highly educated, mobile selves and leave Saskatchewan. What we can buy in Ottawa or Victoria for the same price is not even comparable – and yes, those cities pay higher (at least in our respective fields).
I want to make clear that while we never had any intention of making Saskatoon our home forever, we were here on a five year plan, but now won’t stay for that. It’s very sad because I love this city. I love how polite and friendly the people are, a suprisingly good live music scene, hot summer weather, etc. Really, I’m a very big fan of such a pretty city. Any guests we have from out of province are always suprised by how much they like it here as well. My cousin is here going to law school. He too loves it here, but is leaving as soon as he is done because of the cost of living.
We have thought about trying to buy again, but at the end of the day we just don’t think it’s worth it financially so will buy in the next place we move.
February 28th, 2010 at 10:03 PM
Ginger,
Completely respect your disgust at the general situation here, but your comment that for the money you can get more in Victoria is complete and utter BS. Victoria has some of the highest housing costs in the country. You can still buy a beautiful house in Saskatoon for $500k, that is barely even entry level in Vic. You could probably make a bit more there I will give you that but housing being cheaper, no way! Please, post a link for a decent bungalow in victoria that is $350k.
March 1st, 2010 at 8:34 AM
Hi Peter,
Sorry, I stand corrected on the Victoria thing. I should have been more specific. I wasn’t looking at bungalows, I was looking at downtown condos. For $600 000 in Victoria I can be checking out views of the mountains and the ocean, for the same price (also about $50 000 less) in Saskatoon I can be looking at downtown bus terminals. Also, “probably make a bit more”, at least for one of us, it’s financially more than that.
I want to be sure not to get in a pissing match about which city is better. As I tried to articulate earlier, we love Saskatoon. It has a lot of positive attributes; however, attracting and retaining young professionals isn’t one of them.
March 1st, 2010 at 10:21 AM
I completely understood couples like Ginger.
I know many people moved to the city during 2006 – 2008, due to all the lovable traits Saskatoon has, but I believe the major reason is the housing affordability, which has been gone since. For those who already bought, they’ll probably stay, for those like Ginger, when they get a chance, they’ll leave…
But Ginger do you know that for about $700 you can get a one-bedroom apartment (750 sqft in a concrete building) along 7th Street East (very convenient area,) and $800 for a two-bedroom (not concrete though)? A couple was giving the landlord notice that they would move out since the landlord raised their rent to $900 recently. What they got after negotiation? They switched to another a little bit newer suit with a new rent of only $710. Another couple moved out to another close by building for a 2 bed-room at $800. So maybe before you decide to leave the city, you could try renting at another place. Like I said earlier, vacancy rate seems to have increased, because many couples like you bought expensive houses or condos and moved out. It’s like a test. We’ll see who are the ones smile in the end…
Oh, another thing, more childcare service available now compared to last year. So day care cost should be dropping a little bit as well in the near future I think…
March 1st, 2010 at 11:10 AM
As someone who was born in BC, and spent his life between sask and BC, living in Saskatoon the last three and a half years I desperately miss the nature of BC. Saskatoon is liveable for me b/c we live in Silverwood close to the river. (The river is ok, but nothing compared to BC) Personally I could never understand why someone who is a mobile professional and could afford a five to six hundred thousand dollar house would ever live in Saskatchewan. But I have noticed a very interesting phenomenon – I have spoken with people from various places who just seem to be unable to move away from whatever type of environment they grew up in. For example those (that I’ve spoken to) growing up in Victoria or on the coast can’t imagine moving away from the ocean – my friend living in Sask has no desire to move out of province, and for me, I was born and partially raised in interior central BC and long for the mountains and forest.
March 1st, 2010 at 3:22 PM
We have a similar situation like Ginger has. We are thinking about leaving too. Really sad!
March 1st, 2010 at 4:43 PM
Cindy, $800 for a not concrete 2 bedroom? Guaranteed dated, likely conversion
Some friends kids are paying nearly that for basement suites!
I have a sister in Victoria, current rent just under $900 for concrete 2 bedroom, also convenient area. Very similar to most of the stuff just off 8 th.
It is not reasonable to expect grown ups with good jobs to live in these types of accomodations. I wouldn’t. I benefit from having bought prior to the boom. If I hadn’t, and was graduating now, facing at least $1,000 for a nice one bedroom in Saskatoon? I’d move. Period. It’s an okay place, but who wants to pay top dollar for okay?
Now I face a decision of to upgrade, since I’ve already bought in, or to “cash out” as I’ve seen other posters say, and move some where nice. Tempting, but still a few years from retirement, then again, the premium I could sell my average Saskatoon house for compared to say BC, is a couple hundred thousand dollar swing in my favor compared to a few years ago, and who’s to say it won’t go back that way?
Also tempting to work in BC a few years prior to retirement, but I’m so close that I’d rather just hang on here. And hope our prices are still about on par with most of BC in a couple years.
March 1st, 2010 at 8:09 PM
I have to agree with the other professionals on this post. It seems a little ridiculous when d-i-n-k can not afford Saskatoon. I apologize to everyone for the offensive comment, but are you kidding? There are so many other places in Canada, let alone North America that are much more affordable and, potentially attractive to live in.
Yes, Saskatoon has all these wonderful things to offer. But, more wonderful than Kelowna, Ottawa, Montreal, Halifax, Winnipeg, all with more affordable living accomodations? On the rental side, I used to live in Vancouver – downtown, rented a nice two bedroom basement suite for $750.00/month including all utilities. Freinds of mine currently live downtown, next to the ocean, rent a five bedroom home (mildly dated) for $2000.00/month. So, I think it is absolutely ridiculous the rental prices and home prices in Saskatoon. A part of me does hope that some of these greedy monkeys loose their shirts.
March 2nd, 2010 at 12:22 AM
Who are the greedy monkeys? It seems to me that home prices and rents wouldn’t be so high if there weren’t people willing to pay the price. What are these people thinking? I don’t know, maybe they think it’s a nice place to live and raise a family. Obviously Saskatoon must have some endearing qualities otherwise it wouldn’t have the kind of housing market that it currently has.
Personally, I don’t like the situation here. My wife and I have been happily living in Saskatoon for 7 years now with no complaints, at least none that anyone wants to listen to anyway. Unfortunately, I think there might be trouble on the horizon. I’m probably being overly paranoid about interest rates going up, but considering that they’re pretty well as low as they can go, there’s only one direction they can go.
When and how fast will rates increase? That’s the million dollar question. What I do know is that it doesn’t take much of an increase to have a dramatic effect on monthly payments for a relatively new $300,000 mortgage. I think added interest costs will be another affordability issue that will eventually reduce demand and cause home prices to go down. That might end up putting a lot of folks underwater on their mortgages. I aim to avoid that sticky situation by selling our house in the near future.
March 2nd, 2010 at 8:50 AM
Batman,
“When and how fast will rates increase? That’s the million dollar question.”
…and how long will they be at higher levels?
March 2nd, 2010 at 9:52 AM
If anyone is a Garth Turner fan (or critic), he is coming to Saskatoon on Thursday, April 1st and will be speaking at the Travelodge. Register on his blog or 374-7382 or haighfinancial@shaw.ca.
March 2nd, 2010 at 11:25 AM
Good point Norm.
I guess another motivator behind my wanting to relocate is the fact that I’m originally from Arizona. My wife’s cousin just bought a house in Phoenix last fall for about $90,000. A comparable house in Saskatoon would sell for about $350,000. It has been very tempting for me to move back home with housing costs so low, the only thing holding me back is the lack of job prospects.
On the other hand, I could potentially be mortgage free. Very tempting indeed…
March 2nd, 2010 at 12:16 PM
Batman,
Having a place to go that’s “affordable” enough to make the move is key, and you’re fortunate to have the U.S. as an option if that’s what you want to do. Arizona wouldn’t be that hard to take and there is no shortage of opportunity in housing.
Further to cyn_d’s comments, Turner’s blog is at greaterfool.ca.
Hey cyn_d, do you know if the objective of this thing just to sell books? I noticed that it’s a “free” event.
March 2nd, 2010 at 1:51 PM
Norm,
This interest rate thing can drive a person bonkers if you let it.
“…and how long will they be at higher levels?”
I do see rates going back up to more normal levels in the next few years, but one has to wonder with so much debt in Canada and the world for that matter, I wonder what the chances are of another recession or worse in the next 5 years are. And would rates come crashing down to stimulate spending again at the time if it comes?
March 2nd, 2010 at 2:15 PM
Doug,
For sure. I’ve pretty much given up on trying to figure out what’s going to happen. Rates? Prices? It seems clear that governments will go to almost any extreme to control “free markets” in an effort to make themselves look good. Things are no longer predictable. Even what seems obvious can’t be counted on. At this time last year almost everyone was thinking that a fairly serious correction was in store for housing. The national average price has increased 20% since then (fortunately, we’ve avoided this last round, more or less). Bigger bubble? I don’t think there’s any easy and clear answer to that question.
Over the past couple of years I’ve considered selling my house on several occasions. Having learned a number of hard lessons through attempting to “time” the markets I think I’ll stay put and enjoy life as best I can given whatever circumstances unfold.
It seems to me that the most likely scenario is a total collapse of our financial systems. If that happens, the decision on whether to take a fixed or a variable probably won’t be at the top of your list of concerns, or mine. Unless, or until that happens I’m going to continue living my life making decisions which are as prudent as possible for my circumstances and assuming that my life isn’t going to fall apart at the seams.
I do appreciate the concerns of the “professionals” outlined above. A serious housing correction can have significant consequences for young people staring out. It’s one thing to lose equity, but it’s another thing to end up under water. It can take years to get caught up, and it can immobilize you while you’re doing it.
March 2nd, 2010 at 3:52 PM
cyn_d – already got my tickets. See you (and Norm?) there…
Norm – almost all of his speaking events are free. Those that aren’t are (I believe) closed to the public — that is to say, he is a hosted speaker for a specific function available by invitation only. As such, there will definitely be some discussion of his latest book and a table of merchandise in the back, but I don’t have a problem with that. Heck, most concerts and speakers you pay to see have exactly the same setup (they play their latest music, hawk their CDs and books) so not sure what the difference would be… except that one doesn’t have to pay for this one!
I have heard him (Turner) speak a couple of times on CBC radio and television… what always strikes me is how his voice does not sound like what I imagine it would sound from listening to his words and looking at his picture.
March 2nd, 2010 at 5:42 PM
Doug,
You are absolutely right, very outdated apartments. That’s why I say it’s like a test. Those who can bear with it and who can’t, I’m not sure who are more right though. But the point is, even these shabby apartments they want to charge you $200 more if you don’t speak up.
March 2nd, 2010 at 5:55 PM
Bookrat,
Thanks. I clicked through the registration link on his site and I see that he has a financial services sponsor. I suspect they throw a chunk of change his way and prospect the hell out those who attend. I don’t care either so I’ve ordered some tickets as well. Hopefully we’ll see ya there.
I saw Turner speak at a CREA conference years ago and I recall that I enjoyed it very much, though his message was very similar then (Get out while you can).
March 2nd, 2010 at 6:25 PM
Cindy,
So, it’s not true that every apartment in town has been upgraded with cheap laminate floors, “maple” cabinets and granite counter tops?
I can’t believe how these renovated units all look the same. Someone made a fortune producing large quantities of home improvement products. Still, much better than “dated.”
March 2nd, 2010 at 6:49 PM
“cyn_d – already got my tickets. See you (and Norm?) there”
Wow, it’s looking to be quite the party. Looking forward to seeing you all!
Captcha: “worriers for”. Spooky.
March 3rd, 2010 at 10:29 AM
Norm,
Yeah, I think there’re a lot of “dated” apartments out there still.
I see you use double quotes when you mention “maple” cabinets, why? And this reminds me of a question: are there materials in this market faked to be porcelain backslash and ceramic tiles? I touched to feel some of the socalled porcelain and ceramic stuff and wonder why they do not have the cold feeling as I would imagine and when I knocked I heard sound as if I were knocking on wood… The thing glues them together is the thing glues the real stuff though.
March 3rd, 2010 at 12:48 PM
Cindy,
When I think of maple cabinets, I think back to the olden days (20 years ago) when you would see solid maple, finely crafted. Most of these apartments have 80% particle board and 20% maple (mostly veneer). In fairness, your not going to buy a high end kitchen for a low end apartment, so it’s to be expected.
Ceramic is typically fairly affordable for back splashes so I’m not sure if they’re cheaping out in those areas. I know you can buy some kind of a finished wood or paper product for tub surrounds that are manufactured to look like tile.
March 3rd, 2010 at 7:23 PM
Jen, yes – Garth should be quite a blast!
March 3rd, 2010 at 8:50 PM
Just came back and re-read my posts. I should be much more clear – in terms of Victoria we’re looking at downtown condos, I then jumped and used the $600 000 marker because Peter did, certainly NOT because it’s the price range I’m looking in. Though, gotta be honest if I was this young (30) and could reasonably afford $600 000 mortgage it wouldn’t be in Saskatoon!
Thanks to Doug and Cindy – other for the comments. It’s a difficult line to tow with people – not wanting to insult a city they love and have called home since before I was born and still trying to explain why it’s just not realistic for people to think they are going to retain young professionals when the housing market may have just caught up to the rest of the nation, but wages are still lagging.
I don’t want to live in some outdated 70s style apartment off of 8th. My husband and I both work downtown and recognize we’d chew up at least $100/month in parking anyway (the things we tell ourselves so we can sleep at night!)
. To be honest, we have two other complaints about the city, really, really poor transit (both of us have always been public transit users until we moved here) and we were promised it was an ‘international’ airport when we came here and that we wouldn’t have problems with all the leisure travel we like to do. Ahem…not so much! Now I have digressed…
Anyway, everything for a reason and at the end of the day thank goodness CHMC stepped in on that mortgage. The house really wasn’t worth what we were going to pay for it, but we were a year into living here, loving it, and loved the house and location so were prepared to add a couple of years onto our five year plan.
It is also crazy the amount of money banks want to lend. We went with one of the big five (who my husband has been dealing with for years) and they threw money at us. Thank goodness we had an excellent realtor who completely understood that our max price we were willing to pay was fifty grand less than what we had been approved for. We worked out what we knew we could easily afford to pay and not leave us house broke.
The loss of that house left my husband disillusioned and his ‘everything for a reason’ meant that we don’t buy here at all, but if prices would even come remotely in line I probably could convince him, but not at this point.
Someone also commented earlier about ‘what the market can bear’. I would like to comment that I think that is incredibly short sighted. Just because people are putting up with higher rents because they don’t have a choice doesn’t mean it’s realistic. It just means you are driving away people like us who have to put away a little less every month in hopes of saving for a responsible mortgage. It means that you are squeezing potentially lower income people every month.
March 4th, 2010 at 4:10 PM
Thank you very much for the reply Norm. The back splash might not be their main target to cheap on…Maybe the floor, or something else? Who knows.
Ginger, I’m also surprised that the bank is willing to lend you 7 times your anual income. I guess that is what the average housing price today is primarily based on.
March 10th, 2010 at 4:30 PM
Hey,
Sorry for the late reply. To follow up on my previous comments. I have friends that are 2 years out of school making 80k and won’t touch the market. Why not rent for <1000$ and not have to take the risk of a hit in the market. This combined with high prices and increasing interest rates, makes for some to just wait it out. Young professionals probably will see a job change in the 3-5 year range after they start. Why would I tie a piano to my arse? For "home ownership"? If I want a home that bad, I will just wait till I inherit what my parents have. Less risk and mobility for the next 10-15 years.
So why did the market shoot up so bad? Speculators. I have a friend that is in real estate and about 6-8 months before it got "hot" had people from New York throwing down $5-10 million to "buy everything you can". She had multiple investors come through her with this type of cash. Since Saskatoon is such a small market, they bought up everything. When they made a crazy ROI, they dumped it. This is when everyone else was "catching on" to the amount of money you could make. So you had the amateur speculators come in after. These guys are the ones sitting on the property right now, scared as hell that they aren't going to be able to unload. Some amateurs might have got a decent ROI of 10-20% (but nothing compared to these folk from New York), but lots are gonna get screwed when interest rates go up and no one is buying. Now anyone who bought when it was high doesn't want to take a loss, so they are holding steady. I say, bring on the interest rate hikes so that guy from Alberta who thought he could hose some students for rent loses his hat and has to walk away from it. At the same time, let the university bring more rental property on the market to hammer these guys.
The smart ones who know what happened are not going to touch this market until we see the correction. Most of the mine expansions are going to take 4-8 years to come online. This means that the high paying jobs are not rolling in as fast as some might hope. This correction HAS to happen. The wages have not kept up with the cost of living in this province.
Besides that, why would I want to stay here to freeze my butt off in the winter while getting screwed on cost of living? So I can use the river for 4 months a year to get activity in? I cross country ski in the winter and the trails here aren't spectacular. What else do I have to do in the winter? This combined with an hour long drive (to and from work) to the potash mines? What about a week in/week out camp job (Cameco, fort mac)? Ha. I'd rather pay the same to live in Calgary with the Rockies on my door step and an international air port. In terms of professional networking, this place is quite limited. Sure there are a few big companies, but compared to who has set up shop in Calgary it isn't comparable.
On top of this, the new provincial government is playing roulette with half my income. For one, utilities are going up. What hair brain idea are they going to come up with next week to spend the money on? A domed stadium? A nuclear reactor? Or just pay the potash companies for those cash advances? Decreasing social services? I am hardly comfortable giving my money to the bank, let alone idiot politicians.
I was born in the night, but it wasn't last night.
March 10th, 2010 at 4:58 PM
Just incase you thought I was thrashing Saskatoon, I am not. I really enjoy the city. I grew up in rural Sask and went to university here. The only reason I am still here is that I am waiting for the GF to be done her university. I liked the attitude this place had before housing prices went up. As soon as they went up, everyone’s eyes rolled over and had dollar signs on the back. It seemed to gain a Calgary money mentality, and lose the friendly atmosphere. If anything, I am less of a fan of Albertans (maybe it is just in my blood to be that way), ha. At the end of the day you have to call a spade a spade. I am calling Saskatoon for what it has become for young professionals. Everyone can defend their views and opinions, but I know I am not alone in my views (because I hear it from my peers). This province is going to be in a worse situation for young people than it was prior to the “boom”.