When real estate prices see rapid and substantial change, it’s easy to lose sight of what that really means in terms of affordability. I thought it might be interesting to look back a few short years to show you how very different the Saskatoon real estate market looks today.

The two Saskatoon homes featured in this post sold approximately 3 years apart, following a reasonable period of time on the market.

The property pictured at left, sold at the end of November in 2004. It was on the market for about a month and sold for $212,500. Built in 1983, it’s located in Lawson Heights on a nice cul-de-sac featuring a wedge shaped lot of approximately 7,900 square feet. It has a double attached garage with a direct entry to the home. It also offers a fully finished and heated workshop in the back yard which measures 18’ x 24’. The house itself has 1,960 square feet of living space, if you include the 12’ x 20’ heated sunroom with large windows overlooking the well landscaped yard. You can enjoy the pleasant and private view from inside of the included hot tub, or from the back yard deck. Most of the flooring has been replaced in recent years. All but a couple of windows have been upgraded and there’s a brand new natural gas furnace as well. Additional features included a developed basement, a three-piece ensuite and walk-in closet, central air conditioning, central vacuum, water softener, home security system and a wood burning fireplace surrounded by custom built oak cabinets in the main floor family room.

The property pictured at right sold in December of 2007. It sold for the asking price of $219,900 after three weeks on the market. Built in 1960, the home sits on a large landscaped lot of approximately 6,700 square feet. It’s situated on a busy Mount Royal area street. There is no existing garage. It’s 851 square feet on the main level, but it does have a full basement which is easily ready for re-development. It has some nice upgrades including laminate flooring and new light fixtures, and a “newer” furnace, windows and exterior doors. There’s a nice deck, in a pretty yard. It also has a functional central air conditioning system.

When we look at changes to the “average selling price” we see some pretty shocking changes over a short period of time. This little demonstration puts a proper perspective on how much things have really changed in the Saskatoon housing market. I can agree with those who say that this market was undervalued three years ago but given that incomes in this area have experienced fairly marginal gains over the same period of time one can easily understand why a few voices are saying, “enough already.” Something seems to have gone horribly wrong in Saskatoon housing.

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 Vidorra

Selecting a neighbourhood that you think you’ll be comfortable in isn’t easy, particularly if you’re trying to do it from half way across the country and you’re more or less unfamiliar with Saskatoon.

I’d like to introduce you to a resource which I think you’ll find helpful. I call it Saskatoon Neighbourhoods, Profile and Price Trends. In this section of the Saskatoon Real Estate Resource Centre website, there’s a separate page for each area of Saskatoon. On the most developed pages, you’ll find the following information about neighbourhoods which you may want to consider.

• Photos taken around the area schools, parks, etc. (a work in progress).
• Real estate data from the previous year including the number of units sold (houses & condos), the low selling price, the high selling price and the average selling price.
• The six months rolling average selling price of both houses and condos in the area.
• A house price trend chart which shows how prices have changed over a ten year period, comparing changes in neighbourhood values to Saskatoon in general.
• The kinds of occupations that area residents are involved in.
• Household income statistics for residents of the area.
• Some information about the types of homes which exist in the neighborhood.
• A chart which shows the history of development for the neighbourhood.
• Some information on the percentage of homes which are owner occupied
• Links to schools in the area.
• A Google map of the neighbourhood (zoom out to see exactly where the area is situated).
• In some cases, one or two reviews of the area written and submitted by residents.

If you currently live in Saskatoon, I have a favour to ask of you. I’d really appreciate it of you’d visit the page for your neighbourhood, scroll way down to the bottom of the page and jot me a few words about your area in the provided form. There’s nothing that tells a story like somebody’s story. I know that people will find your words helpful.

Click through to the Saskatoon Neighbourhoods, Profiles & Price Trends page here.

I’m always happy to answer your Saskatoon real estate questions.Feel free to drop me an email.

Norm Fisher

Royal LePage Vidorra

I was speaking with a mortgage person yesterday. He was recounting a conversation that he had with a young person who is interested in purchasing his first home. In response to the question, “are you working with an agent?” this young man indicated that he wasn’t because he couldn’t afford to pay a commission. My mortgage broker friend responded by telling his new client that “the seller always pays the commission and it costs you nothing to use the services of an agent, so you should use one.”

I’ll agree with my friend on his latter point. It probably comes as no surprise that this agent believes that almost anyone can benefit by using the services of an agent in the purchase of real estate. First time buyers are particularly prone to making costly mistakes which can take years to pay for. I will however take issue with his first point. Even though a buyer will not likely see “real estate fees” show up on an invoice; I firmly believe that it is in fact the buyer who pays the commission in a real estate trade. After all, the buyer brings the money to the transaction. Real estate services may or may not be included in the property’s price but chances are, you are paying for those services. Understanding this simple truth may be helpful to you in getting maximum value for your money.

It’s important to understand that a commission is earned in every real estate transaction. If the property is listed through a real estate brokerage, the agent earns the commission for affecting a sale on the property. If a property is marketed privately, the seller is attempting to earn the commission. In rare instances, a buyer who buys “unrepresented” may in fact earn some portion of the commission. You should at least understand that it’s your money that is being earned.

The myth that buyers don’t pay real estate fees has been an excuse for poor service that has gone on long enough. Let’s face it, if you are led to believe that you’re not paying for the service, you’re probably not going to have very high expectations of your agent. After all, we all know that you don’t get much for free, or to put it another way, “you get what you pay for.” Are you getting what you’re paying for?

Prudent buyers should interview prospective agents to find out exactly what services the agent is prepared to provide. Once you’ve selected an agent, hold that person accountable to deliver what’s been promised. Moreover, let the agent know that you actually believe that you’re paying the real estate fees and that you expectations for service are fairly high because of it.

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 Vidorra

Anger was the dominant emotion at Monday’s city council meeting when the application by Viking Developments to convert Saskatoon’s Milroy Apartments to condos was approved.

Current bylaws require conversion applications which affect more than 100 units be approved by council who have the discretion to deny them if vacancy rates in the area are sufficiently low that tenants may have difficulty finding alternative accommodations. According to CMHC’s recently released “Rental Market Report,” apartment vacancy rates in the immediate vicinity of the Milroy have dropped to 1%, and as low as .6% across the city of Saskatoon.

The Milroy Apartments consist of 156 living units. Viking has promised to retain 40 of the units as rental properties which will be offered to long-term tenants at “market rents.” Like most promises, there is no legal obligation to deliver.

Of course, the fly in the ointment here is the tenants who will be impacted, “many of whom are over 70 years of age and coping with limited mobility and health issues,” according to the Saskatoon Star Phoenix.

In the past, I’ve taken the position that the market should be allowed to work and I appreciate the complexity of the decision that council was faced with. That said, I can’t imagine a worse time to force at least 116 tenants, many of them elderly, to find a new home. We could have justified putting this one off until rental conditions improve.

Perhaps “the market” will grow a conscience and bite Viking in the ass!

Read also: Star Phoenix - Milroy conversion gets OK from city council

Read also: Gerry Klein of the Star Phoenix – Few options for city renters

Read also: CMHC Rental Market Report for 2007, Saskatoon

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 Vidorra

In their latest Provincial Outlook, RBC has downgraded projections for economic growth in Saskatchewan over 2008 and 2009, but still expects the provincial economy to perform better than all other provinces, except Alberta. In spite of this short-term downgrade, RBC does seem particularly bullish on the potential for Saskatchewan’s future providing that “the risks of overheated housing and commodity cycles” are properly managed.

RBC economists point to a heated Saskatchewan economy through 2007, which was largely driven by a “sharp reversal in net-migration outflows to inflows, the resulting pick-up in housing markets, strength in job gains, and high commodity prices.”

However, RBC warns that “cracks are appearing” in Saskatchewan’s economy.“Strained housing affordability that has pushed into record territory will crimp housing demand going forward because robust price gains are considerably out of whack with underlying fundamentals.”

“However, a variety of capital investments will support the non-residential sector… If Saskatchewan plays its cards right, then its early fortunes could become an embarrassment of riches for a small population through the triple play of diamond mining, renewed interest in developing its rich uranium deposits and a quickening pace of development in the immensely rich but challenging Bakken formation thanks to high oil prices and better technology… This offers Alberta-style future economic potential for a 70% smaller population, but requires managing the risks of overheated housing and commodity cycles.”

Read the RBC Provincial 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.

Norm Fisher Royal LePage Vidorra

Some have called him extreme, angry and bitter.

Some have called him a good-hearted soul with a social conscience.

MacLean’s, Canada’s national news magazine called him for an interview!

He is Alexander Trauzzi, also known in this fine online community as “Alex.” He joined us early on and he’s been a regular commenter on the Saskatoon Real Estate Resource Centre Blog ever since, openly sharing his concerns and frustrations over the changes which have been occurring in this city over the past year. Recently, he had an opportunity to speak with Jason Kirby, a business writer for MacLean’s and he is formally introduced to us in the opening paragraph of the current issue’s cover story titled, “Is it a bubble? Is it about to burst?”

This was not the Saskatoon Alex Trauzzi remembered.

A few years ago, Trauzzi, 24, had been drawn to the Prairie town for work and grew to love it. He met his fiancée there. And he vowed that after finishing college in his hometown of Winnipeg, the couple would return and buy their first home there. "We saw it as a great place for fresh starts," he says.

But when the couple moved back to Saskatoon earlier this year, Trauzzi scarcely recognized the place. The housing market was ablaze with bidding wars, double-digit monthly price gains and frenzied speculation. Modest bungalows that had sold for $187,000 in the fall of 2006 were by spring changing hands again for $280,000, without so much as a fresh coat of paint. It was insane. Trauzzi, a service technician, felt there was no way he could afford those kinds of prices for a starter home. So after just nine months, he fled back to Winnipeg where he bought a home earlier this month for slightly more than $120,000. Not a moment too soon. Even the Peg is quickly becoming unrecognizable thanks to real estate fervour. "I could easily turn around and sell my house for five or 10 grand more than I paid for it," he says, with a note of astonishment in his voice. "I don't know if there's a bubble that's going to burst or not, but if there is something that's going to happen, it's going to happen right across the country."

Trauzzi isn't alone in feeling anxious about the housing market. Across the country, the B-word is on the lips of Canadians.

You can find the entire text of the online version of this interesting story here. Whatever you might choose to call Alex, you certainly can’t call him a liar, or even a bluffer. He told us several months ago that he’d be out of here if the market didn’t smarten up. Now, he’s gone and it really is a shame that this educated young man and his fiancée felt that they had little chance of making a start here. Is Alex’s moving a sign of things to come? Have changes in the Saskatoon real estate market frustrated our young citizens to the point that they feel Saskatoon no longer offers them a future? Is it a bubble? Is it about to burst? Let’s talk. I’ll start. First, let me say that I think this is a timely, well written story. It’s a story that we should all be interested in talking about. The answers to the questions posed will impact us all regardless of whether or not a bubble exists. Having said all of that, I’ll point out my complaint about the story, only because complaints seem to be better discussion starters than compliments. J MacLean’s directs us to the Demographia Housing Affordability survey to make the case that “house prices, even in some of Canada’s hottest markets, almost look like a bargain.”The report’s cover page tells us that the data used in the study is from Q3/2006. I wrote about the release of the study way back in January. Since then, U.S. housing prices have tumbled in some areas, the average selling price of a home in Canada is up at least 10%, and prices have increased 40-60% in some prairie cities. How is this study even relevant some 15 months later?

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 Vidorra

According to a Statistics Canada population report released today, Saskatchewan has passed the one million mark for the first time since 2001. The province’s population was estimated to have reached 1,003,300 by October 1, 2007 an increase of 6,400 people since July, making it the country’s fastest growing province. According to the report, the provincial population has been “on the rebound” since the fourth quarter of 2006 when it bottomed out at 986,900 people.

Interprovincial migration accounted for two-thirds of the growth and was primarily fueled by people who returned to Saskatchewan from Alberta.

Who doesn’t know someone who moved back to Saskatchewan this year?

Read the StatsCan release 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 Vidorra

Surely, there is a God!

The Supreme Court of Canada today reinstated Jack Grover’s obstruction of justice conviction, ruling that the Saskatchewan Court of Appeals was wrong to overturn the guilty verdict. Grover was charged following a deadly fire in one of his properties which left two children dead and an adult man suffering permanent brain damage. In June of 2006, Grover was found guilty of falsifying smoke detector maintenance records. On August 31 he was sentenced to serve one year in prison for his actions but Grover has a lengthy history of problems related to his real estate holdings which include single family homes and apartment buildings in Saskatoon.  In one five year period over 30 fires were reported at his properties.  He’s been convicted of making a false or misleading statement, obstruction of justice, as well as other infractions under the Fire Prevention Act and Saskatoon’s fire bylaws. This is the first conviction which came with a prison sentence. Sadly, it’s far too short.

Saskatoon City Council approved proposed changes to policies governing the conversion of existing rental apartments to condominiums at last night’s council meeting.

City administrators presented their report which was prepared in response to a request brought forward by Councillor Pat Lorje during the meeting of City Council held on August 13, 2007 to “provide a report to the executive Committee on a review of our existing condominium conversion bylaw, together with suggestions for improvements to ensure an adequate supply of affordable rental housing while still maintaining an orderly investment market for multi unit accommodation.”

The report highlighted the positive and negative “implications” of condo conversions including the reduction in the supply of rental housing, the disruption and displacement of existing tenants, the creation of opportunities for affordable home ownership, investment and upgrading of older properties and the opportunities condo conversions create for small investors to enter the market.

The current condominium conversion policies offer the following protections for tenants occupying the apartments to be converted:

1)tenants must receive at least three months notice prior to an application being submitted;

2)tenants must receive a reasonable opportunity to purchase a converted unit in the building; and

3)tenants, at the time of application, may stay for up to two years after the date of application.

The report, written by Tim Stueart, Manager of the City’s Development Review Section noted, “In recent months, a number of investors have been undertaking measures to remove tenants from buildings in order to circumvent the requirement to allow tenants to stay in place for up to two years after the date of application. This has been done by giving tenants notice to vacate their units prior to condominium conversion application, or by significantly increasing rental rates.”

Both of these practices are allowable under Saskatchewan’s Residential Tenancies Act, in spite of the hardship that they can cause at a time when vacancy rates are low and alternate accommodations are difficult to find.

The new policy, approved last night brings the following changes:

1)increase the notice period for tenants from three months before an application is made for conversion to six months before an application is approved;

2)delete the provision which allows tenants to stay in place for up to two years after the date of application;

3)add a new clause which will provide that during the six month notice period, no rent increases shall take effect and no construction related to the condominium conversion shall be undertaken;

4)add a new clause which will provide that should the rent be increased or construction related to the condominium conversion be undertaken during the notice period, the applicant will be required to begin the notice period again from the date that the rent increases take effect or the date that the construction work is completed; and

5)add a new clause which will provide that where an applicant has vacated or substantially vacated a residential building prior to submitting a condominium conversion application, the application shall not be approved for twelve months from the date which it is submitted. This requirement shall be waived where a building is vacant as the result of significant damage or where t has been vacated as the result of a Health or Fire Order.

Clearly, these changes provide a strong disincentive for investors to attempt to circumvent policy. Hopefully, they will provide a fair balance for both tenants and landlords when it comes to notices to vacate.

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 Vidorra

If you have some spare time on your hands this weekend, you might consider spending some of it at the Credit Union Centre, where the Saskatchewan Federation of Indian Nations (FSIN) is hosting Pow-Wow 2007. Five bucks will get you through the door, and provide an opportunity to experience a truly beautiful “cultural celebration” expressed through song and dance with the people of Saskatchewan’s First Nations.

If you’ve never been to a pow-wow, you’re in for a real treat with this one as hundreds of singers and dancers pack the venue to honour residential school survivors and compete for over $80,000 in prize money. This really is a great Saskatoon event.

More details at the FSIN website

What is a Pow-Wow?

My Flickr slideshow of the 2006 Pow-wow

Doug Elliot, publisher of the Sask Trends Monitor newsletter is warning that consumer spending has “gone into some kind of bubble that’s going to burst.” In a Star Phoenix story titled, “Sask. Consumer spending expected to peak soon” Elliot warns that the big spending spree has to end sometime. He sees that “sometime” looming, perhaps as soon as early 2008.

Elliot notes that massive spending in Saskatchewan is based partly on economic reality to the extent that employment and incomes in the province have increased, but he adds that a variety of psychological factors that are hard to quantify have been encouraging people to spend more money, raising concerns that the level of consumer debt is increasing while savings are decreasing.

One of those factors is related to increasing property values which tend to “make homeowners feel richer and thus more inclined to spend,” says Elliot.

Read also: Your Saskatoon home is not your second income

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 Vidorra

The Conference Board of Canada announced today that Saskatoon will replace Calgary as Canada’s economic growth leader in 2007. Calgary has topped the list of Canadian municipalities for the last two years.

The Conference Board’s website provides this single highlight from their “Saskatoon: Metropolitan Outlook” report which sells for $725. “This year’s real GDP growth of 4.7 per cent in Saskatoon will prompt employment to advance by 4.8 per cent.”

CBC’s web coverage can be found here

Of course, this is excellent news for a market which has seen housing price increases in excess of 50% in almost all housing categories. For months, many have been asking “when will the rest of the economy catch up?” Perhaps your raise is on its way.

A tip of the hat to “Jedi” for the heads up on this story.

Read also: RBC predicts solid economic growth for Saskatchewan in 2007 & 2008

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 Vidorra