Since the subprime mortgage meltdown in the United States, Canadian leaders have assured the public that a similar tidal wave of foreclosures can’t hit here. They have cited the prudence and market dominance of Canada’s five most prominent banks, the conservatism of Canadian consumers and the tiny, 7-per-cent market share of subprime lenders, which is much lower than their 22-per-cent market share in the United States. Just four days ago in a speech, Prime Minister Harper said: “We have avoided the extreme of the unregulated, or barely regulated, financial and mortgage industries that has caused such grief around the world.”

However, The Globe’s investigation shows that while Canada’s real estate sector hasn’t suffered as much as its counterpart in the United States, the Prime Minister and others have grossly underestimated the impact of that small portion of subprime lenders. Until recently, companies who touted their low standards with slogans such as “We Say Yes When The Banks Say No!” and “No Income Verification” proliferated here.

Read the Globe and Mail story 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.

Norm Fisher
Royal LePage Saskatoon Real Estate

No matter how you view the Frontier Centre for Public Policy’s International Housing Affordability Survey, you’d be hard pressed to make a convincing argument that housing affordability hasn’t suffered a serious blow in Saskatoon over the past couple of years. In fact, you’d have to be a fool to even try. When the average selling price of a home nearly doubles in two years time you’re going to see some pretty serious deterioration in affordability. Most of us didn’t need an “international study” to tell us that the cost of home ownership has skyrocketed here but some might be a bit surprised to learn that no other city in Canada has seen affordability deteriorate to the same extent as Saskatoon. According to the study, Saskatoon is now among the ranks of the “seriously unaffordable.”

I suppose the greatest value of this kind of study, if you feel you can trust the methodology and actual statistics, is that it provides a bit of a benchmark as to how we’re doing locally compared to other markets around the world. The Demographia study looks at 265 housing markets and determines housing affordability for each assigning a “median multiplier” as its affordability measure. The “median multiplier” shows you how many years of median household income it takes to buy a home priced at the median in each market.  We’re not quite sure which median income measure was used, or how a “house” is actually defined, but let’s assume that these measures are consistent from one survey to the next and see how things have changed in relation to some other Canadian markets. Here’s a quick look at the changes over the last three survey periods.

Recent price declines would suggest that Saskatoon might have already bottomed out as far as affordability is concerned, at least for now. I haven’t been able to make sense of the “median price” that the Demographia study has used for Saskatoon, but I can say with certainty that the median price of a Saskatoon house has been $21,250 lower over the past 90 days compared to the third quarter of 2008, the period that is measured for the study. It’s down $38,000 from its peak in Q2 when the median price of a Saskatoon house hit $315,000. Things are starting to look up for affordability. With any luck, we’ll be back in the “moderately unaffordable” category soon, and even that has a nice ring to it right now.

See the latest Demographia Affordability Study here
A copy of the 2008 study is here (data from Q3/07)
A copy of the 2007 study is here (data from Q3/06)
See the Star Phoenix story on this study here
And another Star Phoenix story 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.

Norm Fisher
Royal LePage Saskatoon Real Estate

The sales jump, which took economists by surprise pushed active listing inventories down by 1.6% and brought the second consecutive month of inventory declines. Still, a near 10-month supply of residential property is available for purchase across the United States.

Home prices continued to post losses and reached their lowest level since April 2004. The median price of a U.S. home fell to $191,600, down nine percent from one year ago.

According to a story in the Globe and Mail, Lawrence Yun, chief economist for the National Association of Realtors (NAR) attributes increased unit sales to a “rise in foreclosure and other ‘distress sales’ in regions of the country hard-hit by the ongoing housing downturn.”

“In some regions, the lower prices are seeing buyers return to the marketplace,” he said. “This was a nice jump, and hopefully this trend can continue because the first step to stabilizing the market is an increase in home sales.”

Read the Globe and Mail story here.
Read NAR’s media release here.
See the current U.S. real estate stats 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.

Follow our daily updates on Twitter @SaskatoonHomes.

Norm Fisher
Royal LePage Saskatoon Real Estate

Good idea Ben! It would be foolhardy to encourage a second mortgage crisis while you’re busy dealing with the first one.

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

“The strong Canadian dollar, combined with rock-bottom prices for real estate in many cities such as Phoenix, means Canadians can snap up vacation homes or investment properties for less than half of the price of just one year ago. That’s attracted Saskatchewan buyers in droves.”

Two of my favourite Phoenix Realtors were quoted in the story.

Jay Thompson, also known as the Phoenix Real Estate guy writes about the article here.

Jonathon Dalton, the only “guest blogger” I’ve ever hosted here had this to say about his contribution to the story.

If you were considering a real estate purchase in the Phoenix area I would gladly vouch for either of these guys to treat you right and look after your interests.

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

More than 155,000 families have already lost their homes this year. Approximately 1 in 194 U.S. households have received some sort of foreclosure filing.

Nevada is the hardest hit state with 1 in 54 households received foreclosure filings. Stockton, California tops the list for foreclosures in a U.S. municipality. Approximately 1 in 30 homes have received foreclosure notices.

Read the CNN Money article 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.

Follow our daily updates on Twitter @SaskatoonHomes.

Norm Fisher
Royal LePage Saskatoon Real Estate

Cleveland, one of America’s poorest urban areas has seen over 7,000 foreclosures through both 2006 and 2007. In some areas of the city entire blocks of houses are abandoned, boarded up, and stripped of anything valuable. Most often, they ultimately meet a wrecking ball at the tax payer’s expense.

The City is claiming hundreds of millions in damages which result from lost tax revenue, the cost of demolished abandoned homes and the added cost of policing neighbourhoods which have become dangerous due to high rates of abandonment.

Mayor Jackson says, “We have to hold accountable those who are responsible.”

CNN report 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.

Follow our daily updates on Twitter @SaskatoonHomes.

Norm Fisher
Royal LePage Saskatoon Real Estate

Over the past several months a number of my past clients have asked me about real estate opportunities in the U.S. The rising dollar, combined with reduced prices in some beautiful U.S. cities has many Canadians considering a purchase in their favorite vacation spot. A friend of mine from Phoenix recently asked if he could share some information about buying property south of the border, so I jumped at the opportunity to have him as my guest. I’d like you to meet Jonathan Dalton, and his partner, Toby. J

Greetings from Phoenix!

I’m Jonathan Dalton from RE/MAX Desert Showcase and Dalton’s Arizona Homes Blog. Norm was nice enough to let me drop in and talk directly to you folks and I’m quite appreciative. As I write we’re in the middle of a cold snap – it’s down to 53 degrees here, which translates to somewhere around 12 Celsius. But that sounds much colder than it should so I’m going to stick to 53.

One of the big stories of real estate down here in the Valley of the Sun is the surge in Canadians looking to purchase second homes here, usually for themselves and sometimes as seasonal rentals (even though the high season is the same time of year someone from the land of snow probably would rather be here.) I’ve spent most of the last six months acquainting folks from Alberta and Saskatchewan with the Phoenix area and some of the particulars of buying homes down here.

There seem to be a lot of seminars up there telling people what they need to know about buying in the United States, though it seems like the seminars really work out best for the hosts collecting the checks at the door. The basic information’s good but there’s a lot of small stuff you ought to know before you buy in the United States and the Phoenix area in particular.

With any luck (and possibly a bribe or two) Norm will let me write about these in a little more depth sometime. But here are some basic things you should know:

1) The Phoenix real estate market is big. It’s really big. From Surprise in the northwest to Queen Creek in the southeast is somewhere around 65 miles one way. It’s hard narrowing down the search so …

2) Know what you like to do. If you’re into golf (which we do year-round here), golf is everywhere. If you want to watch hockey, come to the West Valley. If you like off-Broadway productions stay closer to Arizona State University in Tempe. What you like to do will impact where you ought to look.

3) Speaking of such things, Queen Creek is in a different county than Phoenix. We’re in Maricopa. Queen Creek is in Pinal. Property taxes are far higher in Pinal County than in Maricopa. The local paper ran an article about Canadians buying in Florence which is even further south than Queen Creek. Not sure if the sales agent ever mentioned taxes.

4) And on that note, don’t go into a new build without representation. Agents at new builds will tell you what they have to tell you but not necessarily everything that you might need to know.

5) Lastly, financing isn’t nearly as complicated as it seems … if you find a lender who knows what they’re doing with Canadian buyers.

Timing is an interesting concept from what I’ve seen with my clients. Not only are you guessing the direction of the local market but you’re also gambling on the currency exchange. A small decline in the Phoenix real estate market actually could be less costly than a drop in the loony. With our dollars at parity, that seems to be the main reason folks are looking more than normal.

I’ve got a penchant for rambling as you’ll discover if you visit my blog so I’ll wrap this up here. Hopefully I didn’t wear out my welcome and I’ll be back again. Thanks much for allowing me to interrupt and I now return you to Saskatchewan real estate news already in progress.

There has been a fair bit of talk and speculation about how the U.S. “credit crunch” may impact Canadians and our real estate markets.

The Canadian Real Estate Association (CREA) has published a brochure titled; “A Credit Crunch Primer” which explains in fairly simple terms what sub-prime lending is and how the practices associated with it have impacted the American lending industry and real estate markets across the country.

The brochure also touches on some of the reasons why CREA believes that Canadians are far less exposed to major fallout.

“Unlike the U.S., the Canadian housing market has not been artificially driven by bad lending practices. Our long-term fundamentals are solid. Canada has a growing population. Our energy and commodities are in high demand, and job creation is strong. Consumer confidence remains high. However, there may be an impact on the overall Canadian economy, which may affect the Canadian housing market. For example, the drop in housing starts in the U.S. will mean lower demand for Canadian softwood lumber products.”

I’ve posted a copy of the brochure here.

A tip of the hat goes to Bill Madder, Executive Vice President of the Association of Saskatchewan REALTORS® who sent me a copy of the brochure. Thanks Bill.

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

Jay is well known as one of the most tech-savvy real estate agents in the world. His website is ranked number 1 out of close to 105,000 websites on the Point2 Performance Index. If you’re curious about the odds of that happening, it’s about 1 in 105,000. It’s an accomplishment to be proud of, and curious as I am, I couldn’t pass up the opportunity to pester him for a meeting once I heard he was coming to town. He graciously obliged me and in spite of the fact that he’d just been through one of the longest travel days of his life, including a three hour stop over in stormy Minnesota, only to arrive in stormy Saskatoon, Jay dragged his butt out of bed and met me for a 7:15 breakfast.

Most of what we discussed would be lost on my local readers, I’m sure. Internet marketing, search engine optimization, blogging, blah, blah, blah. It was largely shop talk which could only be appreciated by a couple of tech-geeks with a burning desire to dominate the Internet.

There was one thing that Jay said which was particularly relevant to the Saskatoon real estate market. I thought you should hear it.

After filling Jay in on the state of the Saskatoon market he said, “Wow! This sounds just like Phoenix a couple of years ago. Properties were selling within hours of hitting the market. Most listings attracted multiple offers and almost everything sold over the asking price, some by tens of thousands of dollars. Investors were pouring in from all over the country buying up real estate in hopes of making a big profit…and then suddenly, like someone turned off the tap, it was over.” (This is not exactly what Jay said. A note pad seemed over the top so I’m paraphrasing.) He went on to share how it “suddenly” seemed like everyone had a property to sell, nobody was buying and values started to decline. While things seem to be leveling out in Phoenix, a fair amount of equity was lost in 2006 and many of the out of state speculators have put their properties back on the market hoping to get out. Today, there are 37,000 active MLS® listings in Phoenix. That would be like Saskatoon having 2,000 properties for sale, instead of 200. It would certainly change the climate.

I remain convinced that Saskatoon is much closer to the beginning, than it is to the end of this rising market. Most of us realize that this won’t last forever but I must admit I hadn’t even considered that it could end “suddenly, like someone turned off the tap.” I’m only certain of two things; this fast paced market will eventually end and it will produce some casualties. It’s rare that an out of control real estate market makes a soft landing.

Proceed with caution.

Jay, thanks so much for meeting me this morning. It truly was one of the high points of my week. I appreciate the time and the ideas which you shared with me. Next time, let’s do it in Phoenix.