Saskatoon real estate: Week in review (July 23-27 2007)
The active listing inventory of Saskatoon homes for sale inched higher again for the eighth consecutive week. 131 new residential listings were offered for sale while only 81 actually traded, leaving a total of 429 homes displaying the active status. This is probably the highest number that we’ve seen so far this year but it’s still well below the levels which would be required to bring balance to a heated market. Over the last number of years we have typically operated with 600 to 700 active residential listings.
In spite of a growing number of listings offered in the Saskatoon real estate market, overbidding continued to occur in a little better than 60% of the recorded sales, but the average overbid was down about 20% from the previous week.
While I’m not in a good position to dig a lot deeper on this point right now, my initial glance at the numbers leads me to believe that there are more properties trading closer to the asking price ($100-$10,000) than there have been in previous weeks. In most areas the average overbid is skewed upwards by a few extraordinary sales, like a Lawson heights condo listed for $199,900 and selling for $285,000. Buyers will want to take some care in the “bidding” process and not get carried away. Many smart minds are expressing great concern about affordability of Saskatoon homes and if inventory continues to grow this market may be seeing its peak for the time being. (See last week’s review for some great insights from our readers and the media).
Notable sales
Forest Grove apartment (1,070’) sells for $220,500.
Silverspring bungalow (1,040’) on a busy street goes at $341,000.
North Park bungalow (792’) with a double detached garage brings $232,500.
Showy Lawson Heights bi-level (1,120’) without a garage sells at $345,000.
Confederation Park two-storey (1,364’) with a double detached garage fetches $275,000.
Thanks to all the readers and commenter’s on last week’s review for carrying the ball this past week.
Trish and I have been away on vacation and won’t return to Saskatoon for another week. I’ve been checking in from day to day but I’ve had little time to participate in the discussion. With so many hours spent away from home over the first half of this year, we’re trying to get caught up and keep our minds focused on family. She was gracious enough to “go shopping” for a couple of hours today so I could prepare this week’s review. Again, thanks so much! I really do appreciate your participation and the additional information and insight which you bring to the review.
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
46 comments so far. We'd love to hear your thoughts.
April 7th, 2009 at 3:21 PM
First off, I want to thank Norm for the dedication to the blog! My wife and I very much appreciate the weekly updates as a means of trying to sort out what houses are actually going for in S’toon.
As someone born and raised in Saskatchewan and now returning from BC, I have been watching this boom with a mixture of pride and apprehension. On one hand I am very happy to see Saskatchewan getting a much needed morale boost. On the other, as a first time home-buyer, I am going to see a far bigger chunk of my income go into housing than I had anticipated. No I am not returning rich in equity… just student loan debt!
The one major comment I would like to add to the discussion is that wages are not so substantially higher in AB and BC to make up for the increased cost of housing. In fact, I have many friends/colleagues in Vancouver that will never be able to afford more than a one or two bedroom condo, and that’s if they’re lucky. They too are waiting for the bubble to burst. Prophecies of a post-Olympic crash in housing prices abound and many cling to this hope (while prices continue to climb). I guess my point is that all first-time buyers in all the major cities across the west are facing increasing costs.
April 7th, 2009 at 3:21 PM
I would echo the above comment about BC wages. I find it somewhat humorous about all of the panic about housing becoming “unaffordable” in Saskatoon. I’ve had a look around and your properties are cheap, cheap, cheap compared to even a second or even some third tier BC cities – and your city has a good base of both blue and white collar employment – large university and abundant industrial parks – unlike so many BC cities which tend to be one or two industry towns (be it resources or tourism) and in many cases, quite charmless. In central Vancouver, a one bedroom newish but not high end condo goes for almost $400,000 – and people don’t make that much more in BC. Keep in mind Vancouver is not a major financial, industrial or high tech centre. In some BC small cities like Kelowna – about 100,000 people+ – nice lakeside location but half the size of Saskatoon without the same facilities or economic diversification, the wages are terribly low but the prices for homes are simply awful – average is north of $500,000 or so. So – don’t feel bad – it is nothing like what we are putting up with!
April 7th, 2009 at 3:21 PM
I still like to bring attention to the site:
http://www.policyalternatives.ca/
as well as:
http://www.growinggap.ca/
Inflation is certainly not a problem only Saskatchewan is suffering with. It’s all over the country, but I think as it spirals more and more out of control, small pockets like Saskatchewan which were once safe from such devastating focus are no longer so.
This will continue to happen so long as we continue to become more complacent like our brethren down South. Accountability and responsibility from the three levels of government has to happen.
This means not allowing the vocal and wealthy minorities to continue making decisions that further benefit them at the cost of the middle class.
A short, two sentence email to an MP, mayor or premier right *now* (open a new window/tab & find them) will make a world of a difference. It also goes towards taking the steam out of their ornery abuse of statistics.
Do it! You and your children have nothing to lose and everything to gain.
April 7th, 2009 at 3:22 PM
Dear Norm:
Thanks for providing new statistic and new information about the housing market in Saskatoon. I have been reading the comments of different people and I have observed one thing that the people are not going to accept new realities in Saskatoon and Regina. It is hard to accept for the people that the housing in Saskatchewan can be so expansive. Most of the people who shifted to BC or Alberta decided to be back to Saskatchewan due to high rising housing prices and it was shocking for them that the house which they sold for 100K is now touching the price of 250K.
The fact is that the property in western Canada was being under estimated for last ten years. The things were changed in Alberta and Saskatchewan is the next to follow as we are seeing for last eight months. The ground realities are that there are new standards for Saskatchewan property. These are solid facts and it is hard to go back to Nov. 2006. I know present prices are little bit unrealistic but I hope soon the things will be stable in coming few months. Still labor shortage is a big issue in Saskatoon. There is lot of land but builders are facing difficulties to develop the land due to labor shortage.
There may be slightly change but for sure there will not be a big change in Saskatchewan housing in near future. These are the fact and people will have to synchronize themselves with this new benchmark.
April 7th, 2009 at 3:22 PM
You’re right Sweety, I’ll go out and ask for a 30k raise.
How silly of me, I should have known better.
April 7th, 2009 at 3:22 PM
Just another investor scrambling to keep things positive so they can maximize their ROI. It’s ridiculous sentiment. I’m sure if we were able to investigate the posters that have been voicing the positive spin on what’s going on, we’d find the majority of them are out of province.
April 7th, 2009 at 3:23 PM
Don’t kid yourself CJ, there’s plenty of people right here in our own backyard that are helping to jack up prices, not just out-of-privince investors. Advertising abroad may have been the catalyst to get things going, but there’s lots of folks here that are more than willing to add fuel to the fire.
I agree with Sweety, I think our market may have been long overdue for a price adjustment. My wife and I sorta made a “side step” in the market in April, we sold our condo and bought a house. The equity that we cashed in on with our condo is safely put away in case if anything happens. I find that the new mortgage payment on our house is still very affordable. My wife and I aren’t rich by any means; we both work full-time, our combined income is far from six figures, and we can still manage to put money away each month for savings after expenses have been paid. Granted, we have a little cushion with the money we made selling our condo, but we didn’t put any more than what was required against the house and the payments were still quite reasonable.
April 7th, 2009 at 3:23 PM
Looks like the numbers are starting to trend back towards reality again. I have a feeling that most of the investors still don’t have a clue that things are turning so this could get a lot worse yet. My prediction, once they figure it out inventories are going to jack up and house sales will really slow down as slow-witted sellers fail to adjust. Look at what is happening in Edmonton, inventory levels have doubled and yet prices have only come down by 2%. This is because sellers haven’t clued in to the new reality that they no longer have the edge. They stubbornly cling to their ‘for sale’ signs wondering when the boom is coming back.
April 7th, 2009 at 3:23 PM
Something,
Now what does anyone do when they want to offer less for a home and get turned down constantly?
Did this situation just get worse?
April 7th, 2009 at 3:24 PM
I am not understanding the problem in Saskatoon yet. Is the housing price so high? Is Alberta money is problem? High inventory is issue? Affordibility is proble? No job issues are going critical? In coming migration is not positive? Can some body tell the exect issues being discussed in this forum. I am actually screwed up and do not know what is the exact problem.
April 7th, 2009 at 3:24 PM
William,
The perspective changes based on who you are and your current situation.
Right now, Saskatoon favors the equity-rich. If you own a home and are coming from anywhere else, you’re in luck. If you’re a business and simply want to buy property to squeeze rent from people, you’re in luck.
The main problem is that because of this, house prices have gone out of reach for people like myself and other young people who are just beginning.
So when the Alberta people come and get highballed a few prices, they think it’s a fantasy. Their home sold for $500k, and yet they’re buying one for $150k to $300k. After a few high prices get out the doors, suddenly everyone wants a piece of the pie and that’s when you get people saying “the market will bear what it can bear”. Which at present is basically the impulse purchase of homes. Which I’m not sure is wise.
For those of us starting out fresh, it’s the equivalent of taking high school football players and pitting them against CFL players. Of course they’re going to lose, they’re simply outgunned in every respect!
This is compounded by the fact that wages in Canada haven’t gone up in step with inflation and most importantly: house prices. With such a sudden jump (100%+ in some cases here!) in house prices, people who could once afford a mortgage like they would rent are seeing home ownership fade into the distance.
Why is there so much inaction?
Imagine you’re an employer. On one hand, you have your employees who owned a home prior to this boom, you have people coming from other places with enough cash to outright buy a home, and you have young starters with little more than a car. Their rationale is “Why would I pay more to the young person so that they get the same opportunity as the older or more firmly rooted people?”
The young people are outclassed and have been rolled out of the bed. The lucky people who have invaded the economy here have allowed businesses to essentially dodge increasing wages. There are two distinct classes in Saskatchewan now. Those who can afford a home and those who cannot, and the gap between them is wide.
You know what makes me sick though? Prices still go up. People don’t get paid more and the businesses are continuing the practice of hording the profits.
Have you been watching the price of pizza go up in this city? I’ve never seen such a cheap gouge – and trust me, pizza prices make a great index for presence of greed. It’s a tangent, I know – but prove me wrong!
(Fact: what Saskatoon considers “large”, most other provinces consider “medium”. But they still charge the same price?!)
On the subject of greed & everything else, I’d encourage you to read through the comment streams for the past two months or so of posts where myself and many people bring forward the issues being faced. It would save people like Johny, Something or Warren who are very good at explaining things from having to double their efforts!
If any of this bothers you, write to an MP, mayor or premier. Not acting on this is doing terrible long term damage to Sasktchewan.
Don’t listen to the ornery and arrogant positions of people who try to commend this boom. They will be the first people in line complaining about crime and higher taxes. Such is the nature of this beast – they assume they can live luxury ignorant to the state of the society they choose to live in.
That way of thinking only works if you live in isolation. The rich in Saskatoon have proven they can’t grasp the social nature of city-living. They want everything for themselves and want to leave nothing for the rest.
We are truly in a corrupt mess.
April 7th, 2009 at 3:24 PM
Once again, sorry for the double posting:
http://www.canada.com/saskatoonstarphoenix/story.html?id=df20ab53-4685-43bd-99c9-d8359eb2c9d0&k=43142
While I was lucky to find an apartment (although my landlord is a jerk and the place is in terrible condition), I’m not far off from this situation either.
It’s sick when making <50k a year still puts you in such a tough spot.
April 7th, 2009 at 3:25 PM
“Saskatoon favors the equity-rich”???????????????
I would suspect all housing markets favor the rich. If anything AB and BC favor the rich far more. Most young people in these provinces have even less of a chance of ‘breaking in’ to the real estate market. I am not saying its a good situation, just that Saskatoon is by no means unique.
April 7th, 2009 at 3:25 PM
Don’t worry and panic…the cycle will pass. Over the last 10 years I have a relative in Saskatoon who has bought and lost (had to sell) 2 houses. Now, comfortably in their 3rd they have fought their way.
It’s never been a cakewalk Alex. Its’ just even more difficult now…but I think it will pass.
April 7th, 2009 at 3:25 PM
Alex,
If you analyze the economics, Saskatoon actually does NOT favor businesses buying rental properties. At least those that I have analyzed. All of the rental situations I have looked at you are basically just barely (if even) able to pay your mortgage. Most of your property tax/insurance/upkeep comes out of your own pocket. I think these investors are buying properties purerly on the hope that they will continue to appreciate. For these investors, I have to admit, things could turn out poorly.
April 7th, 2009 at 3:26 PM
You have to remember, it doesn’t matter. At this point, the price of a decent home will never drop below 120-150k, which means no matter what, I need to make a certain amount of money to be back in that minimum range again.
It’s sad, but so long as the businesses here keep holding onto their money and not sharing the wealth, this problem will continue to get worse.
People need to get paid more or prices need to drop drastically.
I don’t see either happening.
April 7th, 2009 at 3:26 PM
Alex, you have a pretty idealistic (or maybe socialist) view of capitalist economics. The one thing about free markets is that, for the most part, they work. They’re driven by profit. So long as someone can profit at something, they’ll continue to do it. If there’s foundation for that profit, those who engage in it will continue to profit from it. It’s important to consider what many on this board have continually echoed and that is, long term, lack of economic foundation will force a market correction. The higher a speculative market has been inflated, the more severe the correction. A sustainable increase means everyone wins. In our real estate market, that would be something like increased wages, job growth, etc. Watch these factors closely to understand how our free market will react.
It’s just not realistic to assume that a business won’t attempt to maximize profit, they will. They may, however, suffer in hiring migratory workers or not compensating their employees properly when they see high turnover and dropping productivity… this is just a small example of market correction at work. Strange isn’t it?
I personally don’t think a lot of businesses are making more money (with the exception of those engaged in the real estate market). These small factors contribute to an argument that we are seeing mass inflation and speculative buying. Things just aren’t awesome for our economy right now. I’d like to know how many firing cylinders constitutes “all cylinders”
J.
April 7th, 2009 at 3:27 PM
Alex,
I am not saying the prices won’t come down. I think they will. I am just saying expect to see much higher inventory and much lengthier selling times before it happens.
The first thing will be the bidding will slow down and then eventually halt.
After that, they will just very slowly trend downwards, pushed only by the odd desparate seller who needs their cash now. The majority of sellers will still want top dollar and as I said will still expect to get it. At least that is what is happening in Edmonton from what I have read.
The trick to getting the lower prices is to find those desparate sellers and that means putting lots of low bids in.
If you are curious about the Edmonton situation, Norm has a link to an Edmonton real estate blog over on the left of the screen. That is where I have been getting all of my info.
April 7th, 2009 at 3:27 PM
Thanks Alex for telling me the true picture. Alex the main problem in Saskatoon is that it is located close to rich Alberta but getting only “Rich Albertian”.
The main problem, I think it started when the people in Calgary saw signs on road, buses and trains $78K SOLD. One thing should always consider that where the boom is occuring, not everyone is getting the same benefits. In Calgary and Edmonton, there were fair number of people who bought properties in beginning of 2000 and they had the equity of say 250K in the house and many of the were still working on low profile jobs. Those people sold the houses and they were in position to buy houses in cash is Saskatewan. As far as job was concerned, most of these people were working not more than $10 an hour and they thought that this type of job can be secured in Regina and Saskatoon. Now the problem is that these are “Rich Albertian” but unskilled people. They came here for cheap housing but they are not the technical hands and in no way benefit for the province. One other problem is the situation in Alberta is so different than Saskatoon. This winter Alberta is expecting 20 Billion $ investment. Alberta is producing oil next to Saudi Arabia and is going to beat the saudi production in 2012. The tragedy of Saskatoon is that it only received the so called housing boom. Most of the actual residents lost control on rents and surely first time buyers are surprised where to start from.
I think, provincial government is responsible for it who in stead of planning how to maximize the benefits from Alberta boom, they only run compaign to come to saskatewan. In stead try to attract some infrastructure for oil setups in Alberta, Saskatewan only tried to attract people. These are the results of their stupid policy and the most sad thing is that Saskatewan government is presenting as a credit.
April 7th, 2009 at 3:27 PM
Yes, the current governments are waving statistics around like they found the golden ticket.
The second you try and help them understand the damage they’re doing, they step back and point to the MINORITY of jumping-happy rich people with their boats & convertibles.
Arrogance at it’s best.
April 7th, 2009 at 3:28 PM
Okay this is starting to get pathetic. It’s sad when there are no laws to protect the renters against anything and all the Coucilman can say is that it’s greedy. I feel more for the older people that are being displaced after so many years of being there and where are they all going to go. I’m not really proud to be from Saskatoon right now.
http://www.canada.com/saskatoonstarphoenix/news/story.html?id=9472f74c-9649-49bc-bf68-350f0f794f3a&k=20564
April 7th, 2009 at 3:28 PM
I could scream at Lorne Calvert right now for his ignorance. He has no business flying the NDP flag. His party’s policies have moved so far from a social program driven platform to a dirty get rich quick scheme. It’s sickening.
April 7th, 2009 at 3:28 PM
I think all rent in this city should be rolled back. There’s no reason to increase it. None what so ever except ignorance and socially unconscious greed.
Take it back to Nov 2006, roll back to then and impose restrictions from that point forward.
The poor in Saskatoon continue to get gouged and nobody cares.
April 7th, 2009 at 3:31 PM
How many houses did Lorne Calvert and his buds buy before he ran the ads in Alberta? Should be looked into?
April 7th, 2009 at 3:31 PM
The national post just ran another dose of boosterism:
http://www.canada.com/nationalpost/news/story.html?id=9d98cdd6-7a6b-4663-b9c9-813b475b6318&k=63881
What a load of garbage. Not only do we “wannabe” Alberta, now somebody is trying to convince our misguided masses that we ought to take the crown from Ontario too.
Nobody should feel proud about this. What we’re doing is a fast track and it’s doing so much harm.
April 7th, 2009 at 3:31 PM
Lol, Mr. Orr must’ve missed the various articles about the rampant homelessness issue in saskatchewan… unless he plans to exclude all of that from his “standard of living” analysis in Sask.
J.
April 7th, 2009 at 3:31 PM
There have been previous attempts on this blog to distance Saskatchewan’s real estate boom from the prior one in US. Generally the argument has been that the US has the subprime mess which is causing the issues while Canada doesn’t have as much subprime lending.
I would like to direct people to American home-builder Lennar’s (ticker LEN) latest results. In it, they quite clearly explained that defaults are rising across ALL mortgage classes. This includes quality mortgages where defaults have risen from 1.9% to 4.6%.
Blaming the American housing problems on sub-prime is scape-goatism. When housing prices doubled or more in the span of a few years the fundamental issues were there regardless of who was doing the borrowing. Sub-prime mortgage only contribution was to delay the day of reckoning by bringing in additional borrowers. One way or another the crash was going to occur and in case you haven’t been following the business news there is a brutal beating happening right now in anything to do with American real estate. A number of home-builders, mortgage lenders and hedge funds that invested in real-estate are nearing bankruptcy.
This will happen in Canada too. People used to get very mad in the US when you argued that it was a bubble but irregardless you can’t hold back economics. I will be proven right in this bubble as well.
LONG TERM COST OF A HOUSE = COST OF LAND + COST OF LABOR + COST OF MATERIAL
April 7th, 2009 at 3:32 PM
Its great to see that many of you are concerned enough to address the issue of homelessness and the rampant poverty which is the root cause of so many social, health and judicial issues in our province.
However, focusing the blame on elevated housing prices and increased rent is misguided. Its easy to jump on this bandwagon when the media are all over the issue, switching sides every hour and distorting realities.
Homelessness and lack of social housing options have always been a problem in our city, shelters are never empty and social assistance cheques have never been enough to cover food & rent costs. And if you think rental properties are poorly maintained now, you can image the disasterous state of rent-controlled housing options. Until government departments begin to collaborate and effectively share resources between education, health, justice, housing & labor, we will continue to see families and individuals struggle to find housing, attend a training facility, keep a part-time job, vaccinate their children and pay for daycare all without an affordable bus pass.
Five years ago our unemployment rate was almost double what it is today and interests rates were higher. It seems this a more comfortable position for people to accept; living in a slow-paced, debt laden province, happy to let Eastern Canada direct our economic position while the rest of Western Canada employs our skilled workforce. Only in Saskatchewan would we discuss how to resolve an economic boom.
Poverty is real in this province and those who are victims of this fate need our support. It is the responsibility of all levels of government to address this issue and to provide safe, affordable housing options and subsidies. Now that they have the finances to support such initiatives, we need to hold them accountable to do so.
FYI council: This does NOT involve a tax levy to ensure Saskatoon citizens have an olympic-sized pool or riverside promenade.
April 7th, 2009 at 3:32 PM
I loved this quote from the article Alex put up:
“While Saskatchewan’s economic growth will be below the national average, its shrinking population and rising labour force participation is expected to yield “good gains” in terms of standard of living.”
So even there they acknowledge the ‘shrinking population’ not the growing population as Lorne would have us believe.
Alejo I think I’ve heard mixed reviews of moving here and moving out. I know people who have moved due to the rising costs and then I know people that were fortunate enough to sell their home in AB and move back here just about mortgage free. I don’t think we have enough people moving here to drive the market we have though. And if you don’t believe the market willl drop here you go…
http://www.canada.com/saskatoonstarphoenix/story.html?id=ef50fa6a-2664-4d84-951c-f0ec5344579f&k=47202
We will drop. we rose too fast, too hard and there is nothing to base it on. Sask is a great province but we don’t have the job growth yet to suppport this. Meanwhile all the Ethanol plants that were driving the economy may be of no use either since crops are dying due to lack of rain. I think we have/had a bubble. I guess we’ll see in the next little while.
And Beth I think social assistance has to be monitored better. I’m sure there are some people suffering, but I know of people on social assistance that have more technology items than I do and I work as a professional. One guy told me he has to get a $15/hr job to make up for the help he gets on assistance (if he was to work)and my job doesn’t even pay that! I feel bad for the people that are working and have had no choice to leave due to rent increase (or being kicked out to sell the place) and can’t find anywhere else to go due to shortage of economical housing in the city right now. I feel sorry for the students coming back to the city to face a large jump in rent which they were not expecting. I think we should just leave it at that.
April 7th, 2009 at 3:33 PM
Yes Sunny, the price might drop. I guess I should of use a better wording…
What I mean is there wont be a crash in Sask’s housing market. Home price might devalue 5% maybe, but it is nothing compare to the gain of 50%+, overall the home value still increased significantly. I doubt, in the worst case, you will see a decrease in value more than 10%… that is if we resurrect the provincial government from the 80′s.
April 7th, 2009 at 3:33 PM
Alejo it might happen. It all depends on interest rates and how the economy goes in the next few years. The housing prices didn’t go down 5% everywhere in the US, that’s just an average. There are definitely places it went lower. When houses used to sell for $300,000 and now are selling for 200,000 I think that’s a larger jump than 5%.
I think Saskatoon could be in for lower prices yet. And it has happened in the past. I know for sellers that’s not a bright thought, but for buyers like you it sure is a nice thought.
April 7th, 2009 at 3:34 PM
Some people have expended resources to get here, it will take them a bit to get out.
When houses come back onto the market and don’t sell, people like me will go in offering much lower amounts.
Truthfully, I think people need to grow a spine and stop hemorrhaging money when they want a house. Be more realistic and strict with the sellers and assert the true values of the homes. Even if I could afford it, I wouldn’t buy most of the homes for sale in Saskatoon.
Especially any of those town homes & condos that look like a bloody military barracks on the far east of the city (just near #16). Seriously, am I in Minot?!
Bring the quality back at least if the prices are going to be high.
April 7th, 2009 at 3:34 PM
I hope prospective buyers heed Norm’s advice to be cautious when bidding on homes. So many places have changed hands at least two times within a few months – every time the price increases dramatically with no work having been done on the property.
- under 1000 sq ft. sold in March for approx. $230,000 with lots of work needed – not just decorating. No work done. Relisted for $369,000.
- sold in April for approx. $275,000. No work done. Relisted for $359,000.
- overbidding almost $100,000 on a $200,000 condo. Why would you do this?
So many of these multiple flip properties have sat vacant during the past 4 months as owners have never intended to be landlords but just hope to resell at a profit. The withdrawal of these units from the rental market has compounded the problem for renters.
I am not suggesting any kind of controls; however, even if you can afford the prices, it does not mean that you shouldn’t be cautious. Buyer beware is true now more than ever.
April 7th, 2009 at 3:34 PM
Hi Beth,
I’m pretty sure that high housing has had a direct impact on homelessness here which will be ongoing. When over 200 people are given 30 day eviction notices in the course of a week and we’re seeing record high turn aways at both the YWCA and YMCA, It would seem undeniable. High housing = High rent. High housing = increased investment. Increased investment = condo conversions. Condo conversions = evictions. evictions = added stress to vacancy rates…. which means homelessness. I think five years ago saskatchewan was still feeling the tail end of the 80′s crash and rebuilding… if we remain ignorant to the exact same conditions, I’m concerned that history will repeat itself.
But I certainly echo your concerns for poverty and required support.
Again, just general concerns of those who love their community and city. I’m truly tired of my concerns being responded to with “you just can’t accept the fact that everything is ok” It reminds me of the “weapons of mass destruction” predefined argument for any skeptics of the Iraq invasion.
J.
April 7th, 2009 at 3:35 PM
All this talk is very funny.
We should be ‘strict’ with sellers and offer much lower amounts? LOL — if we had done that, we wouldn’t have gotten a house.
The housing market in Saskatoon will correct but don’t expect 100,000 suddenly dropping off a $300,000 house. It’s just not going to happen unless the economy totally tanks and interest rates go through the roof. It is more likely to quit increasing or dip 5 / 10%, but it will not drop 33% anytime soon.
April 7th, 2009 at 3:35 PM
Yeah Sunny that would be nice. My gf and I are planning on waiting a bit anyway, so I hope this happens. We are betting on the price will stabilize in the future. I really hate buying in such a hot market. But it can be really nerve racking right now, seeing price jump up day after day. I do notice that Global TV is a great advocate for the real estate market.
Amen Alex… one advantage for living in Saskatchewan is the open space… and a nice backyard. We got those military barrack style condos as well. But they are not as strange as the downtown condo suites. They sells for 200,000-half a mil. For it you get the best view of Value Village, (a salvation army style store) and shady back alleys. It boggles me to no end. Ohh, I think one of these condo suites are on top of a night club, in the middle of the nightclub street… I pity those people on weekend nights :p
April 7th, 2009 at 3:35 PM
Sunny, if you were being honest about it, the “One guy (who) told me he has to get a $15/hr job to make up for the help he gets on assistance (if he was to work)” is living on assistance and not declaring the income that he makes on the side. It’s unfortunate that you, and others with your mindset, choose to make it sound as if most people on assistance are lounging around in front of their computers and buying the latest tech toys. There are targets for criticism far more legitimate than persons who have no choice but to live on assistance.
April 7th, 2009 at 3:36 PM
well, looking at Gayle’s comment. I am just curious, with the crazed over bidding, would there be some kind of kickback involved? i.e. the condo sells for $200,000, the buyer makes a deal with the seller, buyer pays seller an extra 5000, which arrange paperwork for $250,000? It seems to be one reason to the crazed inflation.
If that’s the case… some people might get a big surprise down the road, from the bank and CRA…
April 7th, 2009 at 3:37 PM
I’m sorry Julie but he’s not making money on the side. That’s what he is making off of social assistance to live the way he is. So due to this he won’t begin to work unless he can make $15/hour. How is that ‘assisting’ them to get back to work. Like I said, I’m sure there are people needing it, but it is being abused too much today and needs to be regulated better. But this isn’t a blog about that, but about the situation that is involving those who are working and trying to survive but SK is not helping them with the housing situation.
I don’t know if we will see a drop of $100,000 in house prices, but it is happening in the states because my DH and I have been looking at moving down there since the houses are less than here. Prices in a lot of places took more than the 5% drop and I’m sure it’s going to take them a while to climb back up. I hope that SK can get more career oriented jobs and more comanies to move into the province an we won’t have to worry about this, but right now I’m not optomistic.
Gayle are you in real estate? Is there a place we can find these things? It sounds like you know your stuff.
Alejo my DH and I waited too. And it never seemed like a good time to buy. We did buy our condo whih was a blessing, but the prices did go up every year. Well not as bad as this year but up non the less. I wish you luck and that you can find the home that will make you happy.
April 7th, 2009 at 3:37 PM
I am not in real estate but following the market is a bit of a hobby. My examples are not from heresay but I personally know the original sellers so do know what they received for their property. I do not know who the second sellers are but if I know of more than 5 situations in a relatively small east side area I wonder what the total picture is like. I would warn anyone buying a home that has no furniture. Ask your real estate agent if was recently traded and for how much.
I check MLS regularly; however, I only study area 2. I write down addresses, prices and dates and then check out the property. In my first example there was a disclaimer by the original seller that there was a cracked basement with some leaking. I notice the resale does not mention this fact nor were there any trades people at the house during the time it was vacant (unless between midnight and morning)- and of course the price has moved from approximately $230,000 to $369,000.
April 7th, 2009 at 3:37 PM
Hai Everybody:
Thanks for such an informative discussion where I am getting such a wonderful information and the fact is that I really feel small. Why? Because I feel myself the “culprit” of this Saskatoon housing boom. I am one of the “Rich Albertian” who sold their houses in Calgary and bought house in Saskatoon in Dec. 2006 and decided to commute for my Suncor job in North Alberta from Saskatoon. In Dec. this city was very different from now but now here there is same race of flipping houses which I experienced in Calgary. This city is very different for me and sometimes I blame myself that I am also responsible for what is happening in this cute simple city which should not be happened.
Alex, your anger for us “Rich Albertian” is correct but the fact is that for me Calgary was so expansive that in spite of my oil job, I decided to move and this is also true that I am looking here number of my fellows from Calgary who moved here just due to housing issues in Calgary. There is no doubt that as a result of so called attracting policies of Sask Govt. the population is growing but the price which the people of Saskatoon are paying is quite big. Again I am sorry that I am also the part of this boom. One thing which sask govt. and city should know that when the population increases these type of issues would rise. Did anybody say anything when Sask. was launching advertisement in Alberta? What are the realistic solution of this problem? What will happen if I send an e-mail to any official? Is there any practical solution which may be implemented according to law? Alex tell me. I will be first one standing with you.
April 7th, 2009 at 3:38 PM
Saskatoon_boy,
I think you’re about as much to blame for this real estate craze as anyone else who lives here in Saskatoon. I don’t have a problem with people who choose to live here, no matter where they commute. I have a problem with landlords doubling the rent on their tennants, essentially kicking them out, so that an investor can snap up the property and make a profit on it down the road. I also have a huge problem with rental companies who are emptying out entire appartment complexes for “renovations”, so that they can be converted to condos. Where does it end?
April 7th, 2009 at 3:38 PM
Sasktoon_boy, welcome to Saskatchewan! TBH, I dont think you are the culprit. The real culprits are the “investors” that are holding multiple properties with the sole objective to dump and make money. The speculators will some harm to the Saskatchewan Economy.
April 7th, 2009 at 3:38 PM
Sasktoon_boy I don’t think you guys are solely to blame for this situation. Yes some of the AB buyers that can pay cash for their houses are frustrating, but not driving the market this high. Like Alejo and Batman said it’s the investors that are not really ‘investing’ in the community, but their pockets, that are frustrating us more I think. It’s the investors which are not even living Saskatoon, not even looking out for the well being of residents of Saskatoon, that is infuriating. Well and Lorne Calvert too.
April 7th, 2009 at 3:39 PM
Sasktoon_boy,
Your considerate and very humbling post is a very nice read and I think I can speak for any “unworthy Saskatoon young adult” in saying I appreciate and accept your situation and what you’ve said.
A few ideas and a bit of bitter ranting to follow:
o Increase the taxes on capital gains off of properties either registered to a business or that are the second-or-up dwelling of the owner.
o Impose more standards on landlords in Saskatoon. They’re getting away with being lazy because quality is so ambiguous. The passive aggressive attitude seems to have worked well for them.
o Regulate rent increases. Many if not most provinces have this, why don’t we?
o Have the municipality release more land and accept suburban sprawl. I’m going to tell you right now that it’s an inevitability. Saskatoon can’t fit any more people because it doesn’t have the room! You can’t solve this problem by expecting people to double up with strangers in their home.
Winnipeg has given in to the sprawl and to be honest with you, in spite of all the downtown enthusiasts, it’s not that bad. Even though we’re trying to control growth, have you ever noticed how box malls are still springing up?
o Get house prices reduced by actually focusing on putting first time buyers in the most advantageous position. Tax write offs don’t help. You can’t solve every problem with a tax write off. We’re at 0 already!!
o Accept that this is a problem that has made it worse for the poor, but has also grown its membership to the lower middle class. A place where most “young desirable” students find themselves five to eight years after graduating (and now longer).
I say this because right now the only solutions to come will address the need of the lower classes. It’s a kind of quasi-philanthropy to help the poor but ignore the middle class. It’s very chic in politics to cut a ribbon in front of starry eyed single mothers carrying babies.
o Eject, or not re-elect Lorne Calvert. Sadly, the alternatives aren’t any better. My views on voting are based on a crisis all of Canada faces right now which is: Don’t vote (or spoil your ballot), the only people who get fair and honest representation today are the rich.
When less people are able to accumulate wealth, your community as a whole becomes poorer.
I hope Lorne Calvert goes down in shame for the kinds of people he has attracted to Saskatoon. A childhood friend of mine who is no stranger to Saskatoon has noticed a night and day difference in the overall level of inconsiderate behaviour.
It’s really turned into a rich man’s paradise here with so little in place to control their impulsive greed.
April 7th, 2009 at 3:39 PM
Alejo,
Welcome, and thanks for your comments.
The concern which you’ve raised about potential mortgage fraud is very valid, though I can’t say that it’s particularly prevalent in sales conducted through brokerages. In 14 years, I’ve only been asked to assist a buyer in this way one time and I promptly sent that buyer on his merry way. I think agents are reluctant to participate in these kinds of schemes. Even if one is not particularly ethical, the risks are extremely high, and too many people need to be complicate to make it work. I had lunch with an appraiser friend several weeks ago who told me that the banks are very wary of this type of activity in the private market where a buyer may directly approach a seller with a “proposal” of this sort. He recounted one instance where he showed up to do his appraisal and the seller told him that the price wasn’t actually the price. He wrapped up his work, called the lender and the deal went down, as it should have. Unfortunately, lenders never seem to want to involve the police so the buyer is free to move on and approach another seller.
For anyone who may be selling a home privately. Don’t get duped into such a scheme. THIS IS A CRIME! It can come back on you, even years down the road. You don’t need to do it and you can likely put a clean deal together with someone and leave the place with a clear conscience and without concern over future repercussions.
To all of the commenters in this post,
I’ve just returned from vacation and see that there are many new contributors. I’m sorry I haven’t been around to acknowledge you as you made your first appearance. I just wanted to say “thanks” for reading and for letting your voice be heard. I appreciate the contributions and the insights which each of you have brought forward. It’s really great to see this kind of discussion happening here. Thanks again!