The latest Housing Market Outlook for the Saskatoon area, which was released by Canada Mortgage and Housing Corporation (CMHC) last week predicts that the Saskatoon will experience its “highest number of sales on record” during 2008 before sales begin to “moderate somewhat…due to rapidly escalating prices and weaker speculative demand.”

Based on February statistics, CMHC notes that the average selling price of a resale home in Saskatoon had already reached $262,000 and predicts further gains of 18% through 2008. That would bring us to about $275,000, easily $25,000 behind the roughly $300,000 averages that we’ve seen posted over the past three months. According to CMHC, we can expect to see prices rise another 8.2% in 2009 to nearly $300,000.

At the end of April, the second consecutive month where sales were down over the previous year, resale unit sales were just slightly ahead of last year (for the year). May is likely to show some larger declines in total unit sales. It seems overly optimistic at this point that we could finish 2008 ahead of 2007.

Read the CMHC Housing Outlook for Saskatoon 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 Vidorra

In the latest “Canadian City Trends” report, released last week by RBC Economics, economist Amy Goldbloom makes the case for a “cooling” but fairly stable Canadian real estate market. Following six years of double-digit gains, sales activity is starting to moderate and listings are growing in most major cities causing sellers to “lose some bargaining power.” According to Goldbloom, “the risk of significant price declines is still low, and Canada’s housing market is expected to eke out modest price gains in 2008.”

Goldbloom does make some comments about western markets, and addresses Saskatchewan’s situation head on.

“The slowdown is not shared evenly among cities. The markets that soared well above their underlying economic fundamentals are the very ones with the most downside potential. Calgary and Edmonton have moved from chart-toppers to the bottom-of-the-heap in only a matter of months on a range of key housing market indicators, including house prices and sales.

“Saskatchewan jumped into the spotlight in 2007 as a commodity-led expansion attracted an influx of migrants and led to a major housing boom. Regina and Saskatoon continue to clock year-over-year price gains that are several multiples above the pace of their local wage growth. This lends evidence that the current momentum is unsustainable, with a similar fate to Alberta’s likely for both of these cities within a years time.”

Goldbloom made similar comments about Saskatoon in October of 2007 when she said Saskatoon homes were overvalued and “out of whack with the underlying fundamentals.”

Read the RBC City Trends 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 Vidorra

It took some time for the Saskatoon Region Association of REALTORS to work the kinks out of a new MLS system, launched in late February, but some monthly numbers for the Saskatoon real estate market have finally been put together, along with the following media release.

Residential Housing Market Remains Steady in the Month of April

Saskatoon REALTORS® assisted 418 home buyers to find their dream home in the month April. That number was down 12% from April 2007 when 476 homes were purchased. Year to date home sales are on par with 2007 with 1480 homes have sold.

The average residential selling price for April was $306,268.00 up 39% from April 2007 when the average was $220,776.00. The year to date average residential selling price is $281,360.00. This average selling price for the month of March was $289,440.00.

The average residential price is derived by taking the month’s dollar volume of homes sold and dividing that number by the unit sales number. The percentage of change should not be used unilaterally as prices vary from area to area. Consumers wishing an accurate estimate of value for their home should contact a REALTOR® member to do a comprehensive market evaluation.

Saskatoon still remains one of the most affordable places to live when compared to larger centers such as Edmonton where in the month of April a single family home sold on average for $386,033.00. That average selling price down .4% from April 2007. Saskatoon again looks good when compared to Calgary were in the month of April a single family home sold on average for $474,564.00. Calgary’s average sales price number is on par with 2007. An additional reality check comes when comparing Saskatoon home prices to Fraser Valley BC where a single family home sold on average for $547,590.00.

Housing inventories have risen across the country and Saskatoon is no exception. REALTOR® listed 898 properties in the month of April that number up 73% from last year at this time when 520 homes were available for purchase. Year to date REALTORS® have sold $416,412,879.00 of residential real estate in Saskatoon that number up 42% from April 2007.

Communities around Saskatoon including Martensville and Warman experienced sales levels on par with 2007 with 104 properties selling. The average price took a jump similar to the city with an average selling price of $244,642.00.

Markets across Canada are seeing inventory levels increase with sales remaining on par with 2007. All indicators point to a strong completion of the second quarter as consumer confidence and in migration continues at steady levels.

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 Vidorra

On April 30, I wrote a post titled, “Saskatchewan Economy Underperforms on Expectations,” following the release of StatsCan’s report on provincial economic performance, which showed Saskatchewan’s “real gross domestic product” at a disappointing 2.8% over 2007, well below the expectations of several Canadian economists. This post set off a fire storm of discussion with many concluding that Saskatchewan is a losing province, hardly able to top national GDP averages in spite of receiving all kinds of positive press across the country and around the globe.

The rest of the story followed this week as StatsCan released a report on “nominal gross domestic product,” which stated that Saskatchewan has “stepped into a new era of prosperity.”

It’s my understanding that real gross domestic product is a measurement of productivity in an economy, while nominal gross domestic product is a measurement of dollar volume generated by an economy. Apparently, it’s the latter that gives Saskatchewan much higher marks.

From the StatsCan Report

• Newfoundland and Labrador's economy led the nation in terms of growth in nominal gross domestic product (GDP) in 2007, at 13.4%. Saskatchewan followed with growth of 11.4%, ahead of Alberta's 8.3%.

• Newfoundland and Labrador's growth in nominal GDP of 76% between 2002 and 2007 also topped Alberta's gain of 73%. Saskatchewan posted the third highest gain over the period, its GDP advancing 49%.

• Higher crude oil prices have been driving the boom in Newfoundland and Labrador and Saskatchewan. They are the top producers of crude petroleum in Canada after Alberta, accounting for almost one-third of Canada's production.

• In 2007, Saskatchewan exported $21 billion to other countries, a 13% increase over 2006. This placed Saskatchewan behind only Newfoundland and Labrador for the title of fastest growing provincial exports. In addition to crude oil, agricultural products, potash, and uranium have made major gains since 2005.

• Perhaps most significantly, both Newfoundland and Labrador and Saskatchewan have reversed their long-term trend of a declining population…Saskatchewan's population grew 0.8% in 2007, its first increase in over a decade, which put the population once again to 1 million. Moreover, the population of the 15 and over age group in Saskatchewan in April 2008 was 2.0% larger than it was in April 2007.

• As incomes have risen and population growth has resumed, Newfoundland and Labrador and Saskatchewan consumers have gone on a buying binge, leading provincial growth in retail, housing and auto sales.

Read the StatsCan report on nominal gross domestic product here.

Read the StatsCan report on real gross domestic product 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 Vidorra

According to a recent Real Estate Trends report issued by Scotiabank, Canada’s housing market is “moving towards more balance, but there won’t be a bust like we’ve seen in the U.S. housing markets.” Yet, there’s little question that the heat has come off in a fairly significant way. Resale activity across Canada has “fallen for four consecutive months and is running about 15% below last summer’s historic peaks,” the report’s author, economist Adrienne Warren said. The average resale price of a Canadian home registered its first “inflation adjusted” quarterly decline in seven years.

New home construction is also experiencing change as residential building permits saw “sharp declines” and inventories of unsold new homes are trending higher.

Warren goes on to say, “Canada’s recent record of price appreciation, averaging an annualized 10% from 2002 to 2007, was unsustainable, and a return to more historical norms is a welcome development.” In explaining her confidence that the market is unlikely to see major declines like it did following the last two Canadian housing booms, Warren makes the following points.

• Home prices in Canada are not substantially overvalued
• There is little evidence of widespread speculative home buying that often accompanies the later stages of a housing boom
• Canada’s real estate market is not overbuilt
• Canadian households are not overleveraged
• Overall mortgage quality is still sound.

“From a regional perspective, the cooling in overall activity is most notable in many of Canada’s hottest urban housing markets in recent years, including Calgary and Edmonton. Both centres have officially moved into buyers’ territory as soaring prices weaken demand and fuel new listings. More generally, however, economic conditions continue to favour the resource-rich markets in the West over manufacturing-dominated centres in Central Canada hampered by a strong Canadian dollar and softening U.S. import demand. Regina and Saskatoon are currently in the strongest sellers’ position nationally, supported by good affordability, rising population inflows and tight supply.”

Read the Scotiabank Real Estate Trends 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 Vidorra

The latest release of CMHC’s Housing Market Outlook forecasts declining resale activity and housing starts on a national level, but predicts Saskatchewan will buck the trend showing increases in both categories.

While existing home sales across Canada will experience an 8.5% decline, resale activity in Saskatchewan is expected to “facilitate a record number of transactions in 2008, reaching 13,400 units,” according to the report. Nationally, housing starts will decrease by 6% while Saskatchewan experiences an increase of 17% to 4,600 units, “the highest total in nearly 30 years.”

CMHC believes positive migration trends, expanded production of potash and oil, higher commodity prices and surging government expenditures will continue to drive Saskatchewan’s economy forward in the years ahead.

“The province’s changing economic fortunes are clearly reflected in the 2007 migration figures. After 22 consecutive years of decline, net migration in Saskatchewan rebounded with a record high of 13,583 migrants. Last year’s performance erased all of the losses in the preceding three years.”

Does Saskatchewan have the goods to buck this national trend?

Read CMHC’s Housing Market Outlook 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 Vidorra

Residential unit sales in Saskatoon fell again in April for the second consecutive month, losing 51 sales in the “home” category, and finishing the month at 390 units, compared to 441 in April 2007. The average selling price of a Saskatoon home (houses and condos only) continued to increase and finished the month at $306,033, up sharply from $287,959 last month. In April of 2007, the average was just $207,436.

The entire drop in unit sales can be found in the single-family home category, which saw sales decline to 261 units, compared to 337 for the same month last year. Prices spiked 40% from $234,406 last April, to $328,798 this year, but there was little change over last month when Saskatoon single-family house sales averaged $326,633. While the average selling price was up a little more than $2,000, Saskatoon home buyers got a little more house for their dollar, paying $276 per square foot, compared to $279 per square foot in March.

Condominium sales actually increased over last year with 129 units trading hands, compared to 104 during April 2007. Average prices took a huge jump when compared to March ($219,173) but experienced smaller year over year gains (compared to houses) of 34%. The average price per square foot increased to $261 in April from $242 in March.

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 Vidorra