or, since the median is actually similar to last year, but the mean well down, we are seeing less outrageously high prices than during last year’s “boom” to skew prices up? median is the better indication of distribution

“Interest rates are the kicker, for sure. What the average person can afford to pay might vary considerably depending on what happens with those.”

Absolutely. I think home prices are at the mercy of interest rates and incomes.

Thanks for the link. I’ve always thought of employment lagging the economy, so I’m not sure how the author of that article (or Jim Flaherty) would have expected this recession to be different!

Tim,

I was looking at that report just the other day, and was also impressed with how Saskatchewan’s economy and most consumers have held up so far, particularly considering past recessions, as Norm has pointed out. Provinces more dependent on manufacturing and construction haven’t fared as well. I’m not sure how the balance and diversification of SK trade have changed since previous recessions, but I’d be interested to find out. Keep in mind, though, that report tracks mortgages that have been in arrears 3 or more months, and anyone with a job loss that was hit last fall or winter might still be slogging through with whatever work they can find plus EI payments. I’m not sure I’d expect an increase yet, but yes, the report is encouraging.

Norm,

I think I’d agree with just about everything you said.

“With very little speculation we’re really seeing what average people can afford to pay. I hope that rates can stay low, at least while incomes are seeing some downward pressure.”

Interest rates are the kicker, for sure. What the average person can afford to pay might vary considerably depending on what happens with those.

“I second the surprise and am somewhat concerned.”

It must be difficult for someone with such acute foresight to admit that.

Jen,

“Record sales with historically low interest rates but prices stay essentially flat.”

Ah, but we had a rather nasty supply problem just six months ago that seems to have been sorted out. Still, while affordability has improved, I think we are likely operating close to our limits right now. I doubt there is much room for price increases at this time. With very little speculation we’re really seeing what average people can afford to pay. I hope that rates can stay low, at least while incomes are seeing some downward pressure.

Tim,

I also note that .21% is the lowest rate of “mortgages in arrears for Saskatchewan in the past thirty years. Compare at 1.56% in 1992. Only 227 households in arrears in the entire province.

According the Canadian Banker’s Association (see site above) Saskatchewan mortgage in arrears are at approximately .23 of 1% and are tracking at about 1/2 the Canadian average for the first half of 2009. At approximately .45 of 1% these Canada overall rates of arrears are similar to the rates found throughout the last couple of decades according to my overview of the charts.

Flaherty admits risk of jobless recovery
http://www.financialpost.com/news-sectors/story.html?id=2060063
“Canada’s economic recovery could end up missing one key element – more jobs – unless Ottawa keeps the stimulus money flowing, Finance Minister Jim Flaherty says.”

I think the biggest wildcard right now is the economy: GDP numbers of 0.1 and 0.0 (for June and July, respectively) don’t exactly point to the recovery the Bank of Canada has been harping about, and this will almost certainly ensure a longer period of historically-low interest rates. I wouldn’t discount the notion of a second stimulus in the near future, either.

Nahh. Not at all concerning.

To me The resale and new home market are being fueled by low interest rates, product availability and consumer optimism in the local economy sounds like The underlying causes of the housing bubble are complex. Factors include historically low interest rates, lax lending standards, and a speculative fever. The second statement is the hindsight reasoning of the US housing crisis. Stated under background.

Unit sales appear to have broken a record for the month of September.
The decline in active listings slowed significantly in September. Combined with seasonal declines in unit sales, “months of inventory” actually grew for the first time in many months.
Prices appear to be steady as they ever have been.