29 comments so far. We'd love to hear your thoughts.

• Jordan
  April 7th, 2009 at 9:44 AM

  Hello Norm,

  I have been viewing your website for close to a year now and let me start by saying thank you for providing such an up-to-date, informative website that allows common people like me to express my feelings. While this is my first official posting, I have been keeping track of the comments the past while and I must admit that your website is by far the most informative website for Saskatoon based Real Estate.

  I am originally from Regina, but my wife and I have lived in Calgary for the past 2 and a half years. We have owned a total of 2 properties while here, starting with a condo and then moving up to the house which we currently own. Our house has now been put on the market as we are preparing for a move to Saskatoon. To make a long story short, the combination of family, lifestyle, and quality-of-life is the cause behind the move.

  Needless to say, we have been actively keeping our eye on the Saskatoon market this past year with much interest. We have seen huge transformations, but to tell you the truth, it feels as if I have seen this movie before. We came to Calgary in 2004, right before the market lost sanity, and I must admit that the similarities are astounding. We were quite determined to be home owners at that time, and with a little luck, careful planning, the right realtor, and nativity, we accomplished our goal. We have seen many changes in the market over the years, more so through our friends who tried to enter the market later on, but like I alluded to before, what is happening in Saskatoon isn’t far off from what we witnessed in Calgary.

  Let me share my thoughts in hopes that it will help discouraged buyers who wish to enter the market. Please keep in mind that this is my opinion only, and while I have no formal training or experience in markets of any sort, I am a bit of an MLS junkie.

  We saw similar trends in the spring of 2005 & 2006 (and to a lesser extent, 2007) in Calgary. Prices were increasing at a mad pace to the tune of 50% and the average overbids were phenomenal. A house on the market for a week was thought to have something wrong with it and people were literally knocking on doors to find places to live. Rent was out of control and if you wanted work, you found it, and as much of it as you wanted.

  However, while I do see some similarities with Saskatoon, I also see noticeable differences. Firstly, the average house price was much higher in Calgary to start with, and now is close to double what Saskatoon’s is, although that gap is decreasing by the day. While the Saskatoon economy is booming, were still talking about prairie-town Saskatchewan, and in my opinion, is no where near Calgary two years ago. I can speak with experience on that last point as my wife and I are professionals and we have yet to find employment in Saskatoon since we began our search two months ago. I have close ties to real estate investors in the Saskatoon market, and it seems to be driven a lot by investors. Maybe the prices will continue to increase, and there will be a shortage for a while to come. Or, maybe the market will cool, prices will peak, and any investor that was looking to make a quick buck will sell, and the market will be flooded with new properties. I don’t know any answers, all I can tell you is that each spring the house prices in Calgary would increase madly, there would be a huge shortage, lots of hype, and infinite amount of overbids and heartaches. Then, as we got into summer, and approached fall, the market saturated (for whatever reason…media, I don’t know), prices peaked (in some cases even dropped), and the market restored sanity and the average days on market would turn into 2-4 weeks instead of 1-2 days. This happened for the two years we were around, and this year it has been even slower, as I can speak with experience.

  If anyone wants to take anything away from his story, it may be this: don’t stress. Things may look crazy now, and with no sign of improving, but I think order will be restored. I know that it is difficult for you first-time home buyers out there, but keep looking. Something will turn out.

• Wendy
  April 7th, 2009 at 9:45 AM

  Thanks for the reassurance Jordan.

  What I’m concerned about is what happens when all of this outside investment in real estate leaves saskatoon and the flippers are done flipping. What are actual saskatonians going to be left with? We can no longer claim affordable living so corporate migration will most likely slow down, taking with it job growth. And then there are all of those poor first time owning families that actually live in saskatoon. My guess is the majority of them have extended themselves to buy. Once those interest rates go up or one loses their job, etc, they will be in serious trouble. I just see all sectors affected.

  Why is the government acting so irresponsibly?

• Norm Fisher
  April 7th, 2009 at 9:45 AM

  Jordan, Wow! Thanks for an encouraging message for Saskatoon home buyers. I really appreciate all of the time that you put into that great comment. It’s nice to hear from people who have experienced this kind of market before.

  I have spent a lot of time thinking about how rapidly rising prices are affecting residents of our fine city. Many of my wise friends assure me that these things have a way of working themselves out. I hope they’re right.

  Wendy, I was looking at an ad today for a “starter home” in a nice Saskatoon neighbourhood. The copy read, “only $1,498 per month with 5% down.” Yikes! We do need to see some income growth if these prices are going to be supported by people living in Saskatoon.

• JP
  April 7th, 2009 at 9:45 AM

  ‘Why is the government acting so irresponsibly?’

  I’m sorry Wendy, but it’s just crazy to assume that a boom is a bad thing. More money and people are pouring into the province than most of us have ever seen, yet some still complain.

  Yes it’s a tough market, and yes prices can make it a challenge to buy, but the increase in the value of property in this city is, on the whole, a very good thing for Saskatoon. This will, as others have said, work itself out.

• Johny
  April 7th, 2009 at 9:46 AM

  It’ll “work itself out”. That’s all I hear. How do you propose it work itself out without those Wendy’s concerned about getting hurt? Is it happening in the overwhelmingly weak real estate markets in the states? Did it happen in the young calgary market after the big 80′s boom where families had to sell their houses for a dollar just to avoid bankruptcy? More people are pouring into the province because of affordable living, not because there is significant job growth (as was the foundation for calgary’s real estate boom).

  Read a book that properly defines inflationary markets and the consequences of speculative investment. You’re right, it’ll work itself out, markets rise and fall all of the time. This market is rising and it will fall. The quicker it rises the quicker it will fall. If you read the aforementioned subjects, you’ll recognize this as a common theme.

  No worrying though JP, I’m not talking about the 4 horsemen raining down, but I am trying to warn those that aren’t looking for the quick buck and actually would just like to own the roof over their heads in pride that there are very real and apparent financial dangers to being the last on the block to invest in this type of market.

  J.

• JP
  April 7th, 2009 at 9:46 AM

  I hear you Johny. It’s important that people recognize the right and the wrong times to buy. I think that comes down to education, those who are not properly informed of all the factors might just get hurt.

• Johny
  April 7th, 2009 at 9:46 AM

  My point exactly. There really is no one there to educate those that are looking to buy a house to actually live in (the avg investor). The banks are more than accommodating when the only mortgage the avg investor can qualify for is 40 or 50 year amortization to be competitive. Realtors are merely brokering the deal and most likely won’t tell their customer of the dangers in buying in such a market. And then there’s my beloved Mr. Percy and those alike that continue to push out unqualified claims that the market will just keep going up and up and up so “better get your home now before it’s too late”. The latter of the 3 components is really the only “education” that the avg investor receives in this market.

  It is in this environment that bubbles are created. And bubbles inevitably burst.

  J.

• Saskaberry
  April 7th, 2009 at 9:46 AM

  As a current Stoon homeowner whose property is soon to go on the market it is frustrating to hear the focus on the flipper or the investor. We are selling because we are moving to another city… no choice in the matter. We love our home and the city of Saskatoon.

  Once we have a few real estate agents through we are going to list on the low-end. When we found out about the move a few months ago we weren’t expecting to get the prices that are out there now.

  My point is that there are still families out there who have to put their homes on the market and they are not looking to gouge the buyer.

  To the comments about Saskatoon’s affordability…

  This place is still very affordable if you compare it across the country. Prices are rising everywhere because people are hearing the message that it is better to buy than to rent. How popular are all those home decorating shows? I have yet to see one called “how to fix up your short or long term rental, and how to get permission from your landlord”. More people want to buy = more buyers in the market = higher prices. Fewer and fewer people are renting and fewer and fewer rentals are available.

  So I don’t think that it is all doom and gloom for cities experiencing what is so quickly labeled a boom. If you are a buyer, just follow the 3 rules of realestate because they haven’t changed… location, location, location.

  Get the best neighborhood you can afford NOT the best house.

• Norm Fisher
  April 7th, 2009 at 9:47 AM

  Saskaberry,

  Good advice.

  While many are obviously frustrated by the pace of rising prices most people seem to understand that home owners who are fortunate enough to “need to sell” at this time have a right to do the best they can. The market will make it’s judgement as to what your home is worth and nobody can hold that against you. Best wishes for a speedy top-dollar sale.

• Johny
  April 7th, 2009 at 9:47 AM

  Haha,

  well Saskaberry, let me ask you this, if 6 months ago you were going to sell and someone told you to wait 6 months because you’ll make 70% more, would I have a right to be pissed off at them for their advice? I would never blame you for selling your house at a premium. I’m merely advocating the necessity for education of those that are looking to invest in an inflated speculative market.

  Good luck (sincerely).

  J.

• Saskaberry
  April 7th, 2009 at 9:47 AM

  Just to clarify.

  We have been planning from the beginning to list in June because of the possesion date we are looking for. We weren’t holding out for this market (that nobody could have predicted).

• Johny
  April 7th, 2009 at 9:48 AM

  You should hold off for 6 months because your house will be worth another 100K by then Ask Dwight!

• Saskaberry
  April 7th, 2009 at 9:48 AM

  Ummm I am guessing most of what you are saying is tongue -in-cheek but you are missing/skewing my point…

  I DO NOT WANT TO GOUGE THE BUYERS! My point is… there are still many regular homeowners out there that have to sell and are NOT looking to just cash-in.

  It was just a comment to balance the investor, flipper comments. Sure they are lurking but on the whole it is not as sinister as all that… just regular people moving and selling.

• Norm Fisher
  April 7th, 2009 at 9:49 AM

  Saskaberry, I think Johny’s initial “Good luck (sincerely)” was sincere, and the most recent comment “tongue in cheek.”

  One can hardly blame a seller and accuse them of “gouging” if buyers line up at the door and throw money at them. Even Johny wouldn’t throw it back.

  Your timing just happens to have worked out for you. No more, no less.

  Again, good luck.

• Alex
  April 7th, 2009 at 9:49 AM

  These prices are not working themselves out and what’s happened in Saskatoon is people originally from here have been out-classed by a league of buyers from a different market.

  You’ve got two, maybe three sets of buyers in Saskatoon. Those coming from Alberta, those who already own and those who do not.

  Guess who gets the best deal?

  For the rest of us? Well, we just got rolled out of our beds with not a soul in sight to bring attention to our plight…

  Not fair at all, and very irresponsible of the government to let houses get traded as they are now. People should be restricted from selling houses just to turn what is a socially and economically dishonest profit. The promotion of such movement increases the value of the property, but severely reduces the quality and attitudes of a city – I’m surprised nobody has noticed this yet…

  There are many people who are willing to come into Saskatoon as contributing, positive members of the community, but can’t. I’m already seeing the very subtle impacts of the kind of city Saskatoon has become.

  As for the self correcting theories, they just aren’t true. I’m starting to think that even if I get a raise, I still won’t and possibly even shouldn’t buy a home in this market. You’ve got Saskatoon of the sleepier past, and Saskatoon of the greedy future existing both at the same time. We can call this Saskatoons multiple personality phase…ha.

  Either way, the houses just aren’t worth what people are charging for them. If you’re looking to buy a house in this market – don’t. You’d be a fool to.

  These trends continue to disgust me and I’m starting to wonder if Saskatoon will ever be capable of having the promise it once had…

• Jeff
  April 7th, 2009 at 9:49 AM

  ‘People should be restricted from selling houses just to turn what is a socially and economically dishonest profit.’

  I hope you are joking comrade.

  People need to stop pointing fingers at the government. This is a supply and demand issue, and we should be happy the government has generated interest in our province.

• Jerry
  April 7th, 2009 at 9:49 AM

  ‘People should be restricted from selling houses just to turn what is a socially and economically dishonest profit.’

  Yes,absolutely agree! Especially for people who buy the house but not live here!!! Their only purpose is to steal money from saskatoon people and to damage our city.

• sdude
  April 7th, 2009 at 9:50 AM

  Sinister investors?

  I have to defend myself as a big bad BC investor in Saskatoon real estate. I was raised in Saskatoon and naturally decided to buy an investment condo in Lakeview a few years ago at the urging of fellow investors in Vancouver who just did not know Saskatoon like I did. After several months of checking things out and 2 trips to Saskatoon I found a great top floor 2-bedroom in Lakeview and got it for $1500 below asking in Dec. 2005. My plan was always for the tenant to pay the mortgage (the classic real estate investor play) and hold the property for at least 20 years. It’s worked out nicley and the recent amazing appreciation in values has been a surprise and a very nice added bonus but something I ever expected.

  Anyway, real estate is not illegal and, quite to the contrary, provides a lot of benefits to the overall economy.

  Since buying the condo this is what I’ve done for my tenants out of my own pocket :

  -new laminate floor

  -new kitchen/bath lino

  -new carpet in the 2 bdrms

  -new dishwasher

  -new air conditioner (10,000 BTUs brrrrr)

  -new bathroom vanity/mirror

  -plumbing repairs

  -2 coats of paint walls and ceiling

  -new blinds living room, 1 bedroom

  -all new shelving closets, storage room

  -new laundry room bifold door

  -all new 4-inch baseboards

  -miscellany including drawer hardware, door stops, light fixtures, smoke alarm, door handles, towel rack, etc.

  I get to write off a bit against my income but it comes nowhere near paying for my costs.

  Thanks Norm for letting me vent.

• Alex
  April 7th, 2009 at 9:50 AM

  sdude, what you’re doing is blocking a property that you will never live and driving up demand and prices. You have no regard for the impact on the local economy by what you are doing.

  You are forcing your tenants who might have normally been able to use the same money for rent to pay a mortgage to take infinite debt with no return.

  Sounds great for you when you consider that you likely already own a home. Why should you care, you’re getting away scott-free. It is that very attitude that should not be allowed to prevail because people who have always planned on living in Saskatoon are now being punished for their honest nature – while you come in and turn a quick buck.

  That is why I said what I said, and I stick to it. You shouldn’t be allowed to do this, homes should not be a competitive market, they affect the stability and comfort of families. Where you live leaves an indelible mark on your day to day life.

  Why should they be priced out of the market and forced out because your greed has created a shortage?

  An “investment condo”, sounds like a really high level “get rich quick” term to me.

  Just how many houses are there in Saskatoon that should be owned by the people who live them, and not greedy opportunists, ruining the average wealth of an entire city?

• Norm Fisher
  April 7th, 2009 at 9:51 AM

  Alex and Jerry, wow! I certainly appreciate your frustration with what’s happened to housing prices but your suggestion that the government should control the free market is kind of “way out there!” Maybe it would be best if they just lined us all up in row houses, each one alike, and picked out a nice job for us.

• Norm Fisher
  April 7th, 2009 at 9:52 AM

  Alex, man you have some way of thinking on housing and the economy. What would you suggest to the 35% of the Saskatoon population that doesn’t own a home? What about those that don’t want to own a home? Is that okay with you? You’re living in la-la land if you think that guys like sdude don’t play a vital role in housing. A decent supply of rental housing is critical in any market. Without it, many more would be living on the streets.

• Abe
  April 7th, 2009 at 9:52 AM

  “A decent supply of rental housing is critical in any market. Without it, many more would be living on the streets.”

  Exactly. What about the people who DON’T want to buy, or can’t, or are just living in Saskatoon temporarily? I think before most people buy a house they are in a position where they have to rent until they can save enough for a down payment.

  Listen to Norm, he’s been doing what he does for a long time and he know his stuff.

• Johny
  April 7th, 2009 at 9:52 AM

  Wow, what a S**T storm.

  Honestly, no seller can be blamed for look’n for top dollar nor can they be restricted from doing so in a free market. People can’t be blamed for buying in the interest of investment for the same aforementioned reason.

  The root of where we’re at right now is the market manipulation and inflation by those like Percy who misinformed investors and have created this frenzy or “boom” (or bubble). We really won’t know the outcome until someone does significant analysis of sask economic growth outside of real estate (ie corporate development, job growth, income growth). In seeing what i’ve seen from various sources, these sectors haven’t seemed to grow significantly in relation to home value. CMHC predicted that by 2008 the avg home would be 195K and today avg homes are selling for 250K. CMHC has done significant analysis of the aforementioned sectors of our economy to get this number. So if, from their analysis, they see the avg home value to be 195K and it is 250K obviously that’s a pretty large delta needing to be corrected for sustainability. That’s where I raise alarm for those who are considering buying today.

  When I say the gov’t is acting irresponsibly, I’m not implying that they should step in a put a halt on home sales. I’m saying they need to manage this growth appropriately and focus their attention on more than “come buy a home here because it’s cheap (comparatively) and you will make money by next spring”. The only thing that will sustain this growth is massive resource exploitation which, I’m proud to say, hasn’t been the initiative thus far. Resource development absolutely has to be managed or saskatchewan will be pumping just as much carbon into the air as Alberta (coal power) and our landscape will be scraped.

  I’m truly concerned but we can’t find fault in those participating in the market, only those who misinform the participants.

  J.

• sdude
  April 7th, 2009 at 9:52 AM

  Dang, stupid typos in my first post, sorry about that.

  I’m not a flipper, I haven’t turned a quick buck. In 20 years when the property is paid off I’ll have a guaranteed income every month which will fund my retirement (along with the other properties I own). I won’t be a burden on the social system, I’ll be providing good quality housing for my tenants, work for local contractors, property managers, caretakers and buying goods and services in the local economy. It’s called smart financial planning for your future.

• Gayle
  April 7th, 2009 at 9:53 AM

  What a frenzy of discussion on this issue of real estate price increases. I get worried when the opinions label profit as being for anyone as somehow being unethical. A part of this situation has been driven by the failure of the city to provide the number of lots needed by homebuilders. Check the number of lots made available in 2005, 2006 and then 2007. 2005 had a far higher number than the past year. As for government control – what makes anyone think government has any wisdom on this topic. I am most interested to find out what has been the growth in Saskatoon’s population in the past 3 months. Are corporations hiring? Anecdotally, everyone knows someone that is moving back but what does this translate to – an additional 100 people in one-quarter or additional thousands.

• Norm Fisher
  April 7th, 2009 at 9:53 AM

  J, thanks for an objective response. I think you got Alex kind of worked up. It really frustrates me when I hear people calling home sellers “greedy.” By the way, I don’t think I can recall a CMHC forecast which was particularly accurate, in the last few years anyway.

  sdude, that sounds like a really self serving retirement plan. Thanks for your contribution to the Saskatoon housing market. I appreciate the fact that you bought here when the whole country was dumping on us.

  Gayle, thanks for stopping. There’s no doubt that the supply side is a big part of the problem. Unfortunately, nobody saw this coming. Had the city prepared a surplus of land which was left sitting vacant they would have taken a lickin’ for that. I think they’re doing the best they can to move things along but we’re a long way off from seeing a lot of new home inventory on the market. It will be interesting to see where the migration numbers sit when the dust settles. I’ve had ten clients leave Saskatchewan this year. I’m fielding several calls a day from out of the province. Many say they are “moving to Saskatoon” but it’s hard to know whether or not they are actually investors in disguise. At the present time, the only people who command less respect than real estate agents are out of province investors. Thanks again. I appreciate your insightful comment.

• Alex
  April 7th, 2009 at 9:54 AM

  I don’t think it’s unreasonable to note that there is an excess of rental property in Saskatoon right now.

  That’s just about all you see everywhere is places advertised as “investment property”. It is a total fad. Another one is the expectation that you have to rent out your basement. Concepts like that would fly in other places, yet here in Saskatoon the trend is to blindly accept things like this.

  What I’m saying isn’t an extreme perspective, it’s the truth. These investment properties are preventing demand from being satisfied. People should be allowed to buy their home, not rent it – especially because investment properties are usually the 2nd+ home for their owners.

  With regard to the economic growth discussion, I really haven’t seen any either. What I’ve heard from some Albertans this weekend alarmed me. Many homes are just oil workers flying out from Saskatoon instead of somewhere else.

  It’s hard to say if this will benefit Saskatoon. In one sense, you have their incomes, but in another, there are still lots of investors leeching money out of Saskatoon. This kind of “un-boom” can really do a number on this city and chances are the only industries that will thrive in all this are the service & food industries.

  I doubt those will pay enough money for people to buy homes in this market.

  Then there’s the wage issue where yes, people should be getting paid more. But I don’t think an ally has come forward to really press that point to employers. I don’t think I need to iterate what their attitudes are.

  So yes, I think a lot of Saskatoon’s problems are greed based and the one-sided attitudes like “well you’re just overreacting” are very dismissive. The gap between rich and poor continues to grow at an accelerated pace and if those who can’t afford homes can’t make an argument for themselves, what are they to do?

  Sit down, be quiet and rent?

  No thanks.

• Norm Fisher
  April 7th, 2009 at 9:55 AM

  Alex,

  You make some good points about the growing gap between rich and poor, and I agree that home ownership is an important component to building a little wealth for most Canadians. Believe it or not, I also think it’s better for people to own than it is to rent, but the fact is that not all are in a position to do that and many don’t want to. Let me point out two of the positions which you took which I think are over the top.

  You said, “People should be restricted from selling houses just to turn what is a socially and economically dishonest profit.”

  Alex, your position is radical and dangerous. I enjoy my freedom and I object to the idea that big brother should be able to tell people what they are allowed to acquire and how they can dispose of it.

  You also stated, “sdude, what you’re doing is blocking a property that you will never live and driving up demand and prices. You have no regard for the impact on the local economy by what you are doing.”

  Sorry, this is just hogwash! sdude is a responsible investor who bought this property long before the “un-boom” as you call it. He’s providing a safe and attractive home for someone who chooses not to own at this time. He has contributed to the Saskatoon economy through his investment, payment of property taxes and he has employed local trades people and supported local retailers in making improvements to this property. He didn’t come here to “flip” a property to make a quick profit. He plans to hold it for the long term. You speak of him like he’s some low-life because he owns more than one property. If your savior government forced all “investment property” owners to sell their properties, this market would crash and burn so fast you wouldn’t know what hit you and many more would be living on the street in one hell of a hurry.

• Alex
  April 7th, 2009 at 9:55 AM

  Lots of people are being forced to choose not to own.

  I would debate how many people would be apt to take out a mortgage if prices were more reasonable.

  I think the investment properties are out of control and once again, it’s a fad.

  The writing is on the wall. Who can sensibly afford to buy homes right now?

  I’m not excluding the fact that wages have to go up, certainly there needs to be some correction.

  But what good are municipal and provincial efforts to provide more property & accessibility when they just get snapped up by these black holes of wealth?

  The benefits are unobservable and the homes never make it to their intended audience!

  There has to be a freeze on the investment property and flipping craze. There’s too many people who are perched waiting for the right moment to pounce whatever becomes available.