Real Estate Information Archive

The May numbers are indicating that we are seeing the market softening a bit. It is encouraging to see that the price range of $300,000 to $500,000 has shown an increase in unit sales of 16% higher than May 2009. Over all the unit volume was 4% lower in the same month last year. YTD units sales this year are up 8%. I noticed that things have tightened up since the CMHC rules were changed. They have made it more difficult to qualify by forcing people to qualify for the five year term, which is at the 6% rate. This change has made the buyers a little tougher in negotiations.

I was discussing the real estate mood with a car salesperson the other day. It was felt that the used car market is similar to the real esate market in that the buyers are tougher when negotiating their purchase.

There will always be people needing to buy homes and those who need to sell.  It may take a little longer sometimes and the prices may vary a little, but the is always a buyer for a good property.

Sales have declined in Canada overall. We are influenced by the national situation to some extent, but we have a stronger economy in Saskatchewan and particularly in Saskatoon.

All the rain we are getting will have a pretty significant effect on the farmers throughout the province. I guess we will see how much as the year passes. We were worried last year and it ended up being a very good year. It doesn't look good for the farmers as of this writing. I guess time will tell.

I read the editorials in Friday's Saskatoon Star Phoenix this morning and ran across a comment stating that real estate in Saskatoon was not a good investment particularly your own home.

I don't agree. I felt the writer was very short sighted. He stated that if you bought a couple years ago your home was actually worth less than it is now. While this may be true in some cases, there is no doubt in my mind that over a five year window your home's value will definitely be higher. If your home is worth between $200,000. and $350,000. it is certainly worth more money today than it was 3 or 4 years ago. If you look over the past 10 years any home has more than doubled in value, even though your payments are the same, or in some cases less, if you have a variable rate mortgage. Especially if you compare to renting, where the rents have increased substantially over the  same period.

If you invested the money in mutual funds 4 years ago you are extremely fortunate if your asset has maintained its value.

For those who understand investing, as Robert Kiyosaki explains it in Rich Dad Poor Dad, your home is not an investment, but to most of us it is the highest valued asset we own. As we grow older our home is the most secure asset we will own. This security is very important to maintain stability in our later years.

I have seen times in my career where people sell their homes and decide to rent as they get older only to find that the rents have increased dramatically and in some cases their apartments are converted to condos and they are forced to move at a time when they are the least able to handle to stress of making changes.

So you can look at home ownership from a different perspective. I feel very strongly that owning your home as soon as possible in your lifetime is the best option for anyone by far. Over the decades as one goes through life, home ownership is the best choice for your future financial security. 

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January was a great month for Saskatoon weather for most of the month, but not so great for real estate sales. We have seen unit sales decline in most of the categories. Dollar volume was down by 18% in the city. Unit sales were down by 16%. I believe this was due to low inventories in the lower to mid price ranges, where the demand is highest. I noticed this developing over the past 6 months, with the largest part of our sales under $400,000.00. I noticed an incease in unit sales in the $450-$500 range. This is encouraging. This price range has seen lower activity over the past year. While this was great, we saw lower activity in the above $500,000. range in January. Volumes were lower in most ranges. This may be good news for the sellers that have been waiting for prices to move up before selling their house. Now may be a good time to sell and get a better price than last year.

The average sale price dropped 3% from last January. I expect this is because of the short supply of the lower priced product available. We are now waiting for the break that will bring more product on the market at a little higher prices in the $200,000. - $350,000. range.

It seems to be more of a challenge to find the buyers for the higher priced houses.

With only 3 unit sales over the $500,000.00 in January we should be careful not to measure the expectations for the coming year on one month. I expect we will see an increase over the next few months.

Overall our economy is postive and the buyers are calling to check things out. When that senario is happening it is positive.