Saskatoon real estate week in review–October 19-23 2009

Saskatoon real estate week in review–October 19-23 2009
Unit sales of single-family detached houses and condominiums saw a small increase to sixty-six units this week, up seven properties from last week and sharply higher than the same week last yearwhen Saskatoon real estate agents reported just thirty-eight sales to the multiple listing service. While our market is unquestionably seeing a typical seasonal slow down, interest and activity seem to be stronger than we would expect for this time of year. Month-to-date, total residential sales sit at two hundred and twenty-five properties with a full week remaining in the month. Total sales for October of 2008 were two hundred and thirteen while the five-year average for the month of October is two hundred and forty-eight, a number which we will certainly see beat this year by around twenty percent, even if it’s a slow week.

New listings of Saskatoon homesalso bounced slightly higher to seventy-two units, up from sixty-four listings last week, but lower than the same week last year when ninety-five properties were offered for sale.

Active listings in the residential category declined again. The change was small, but enough to pull the total inventory of Saskatoon MLS listings below the one thousand unit thresholdfor the first time in sixteen months. The week closed showing nine hundred and ninety-six active listings, ten fewer than last week, and well off of the sixteen hundred and ninety homes that were available last year at this time. The total active inventory consists of five hundred and eighty-three single-family homes and three hundred and forty-eight condos. Last year at this time, those two numbers stood at one thousand and fifty, and five hundred and thirty-three respectively.

Just twenty-one listings were cancelled or withdrawn from the market this week and fifteen of those re-appeared amongst the “new listings” for another kick, most at a new price. An additional thirty-nine home sellers adjusted the asking price on their home hoping to bag a buyer before winter sets in and demand softens further.

Twenty-seven of this week’s sixty-six sales were condos, and consequently, the average selling price of a Saskatoon home took a huge dip falling to its lowest point since June.The average finished at just $265,032, thirty-eight thousand dollars behind last week, and fifteen thousand dollars lower than it was at this time last year. The six-week average fell fifty-four hundred dollars on a week-over-week basis to close at $280,016, about fifteen thousand five hundred dollars off of last year’s number. The four-week median fell to $270,000, down from $272,900 last week, and falling below last year’s number by five thousand dollars.

Click the image for a larger version of the graph.

In spite of lower prices overall, Saskatoon home sellers did reasonably well when it came to negotiations with eight sales at list price, six sales above asking price, and the remaining fifty-two properties averaging a discount of just $9,807, down from last week in real dollars, but a higher discount as a percentage of the asking price. The average discount where sales occurred below asking price was 3.6%, up from 3.2% last week. However, a significantly lower median led to many more sales within $5,000 of the asking price as this category accounts for fifty-three percent of all sales, up from thirty-five percent last week, and about as high as I ever recall it being.

Aggressive price growth in Canada’s largest markets continues to push the average price of a Canadian home higher, and in fact, they’re now at record levels of $331,602. Toronto’s average selling price is up $40,000 year-over-year to $406,877 and Vancouver’s prices have increased $75,000 over the same period. I suppose we can consider ourselves lucky to have what appears to be some measure of house price stability in Saskatoon, but it’s hard not to feel that something is going terribly wrong in Canadian housing and I can’t help but wonder how we’ll be impacted if a house of cards begins to fall in our nation’s largest markets. This week, the media was buzzing with talk of a Canadian real estate bubble. Here are a handful of the stories that ran this week.

Bank of Canada monitors real estate surge

CMHC bubble is 100% Canadian made

Why Canada’s housing bubble will burst

CMHC’s growth fuels worries over new risks

Carney urges prudence in housing market

Expect to hear more of this talk in the weeks ahead as our government attempts to throw some cool water on a housing market that appears to be out of control.

Personally, I think prices are reaching their peak across the nation and that some cracks are beginning to show. In Saskatoon, where prices have remained flat for most of 2009, there is probably little hope for sellers that better times than these are on the horizon. If you want to sell your home, you should probably put that goal at the top of your priority list to complete before the end of 2009. This little real estate boom could end as abruptly as it started earlier this year. That’s what my gut is telling me today.

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.

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Norm Fisher
Royal LePage Vidorra

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