The future is written for Riversdale

“The future is written for Riversdale” and at least one Saskatoon business leader sees better times ahead.

Curtis Olson, of Shift Development Inc. recently purchased the old Joe’s Cycle Building at 220 20th Street West. When renovations are complete the building will become his company’s head office and a business hub for other “forward thinking businesses” who see a brighter future for an area that has seen its share of social challenges over the years.

Olson told the Star Phoenix, “I have spent a lot of time in Riversdale. I’ve kept a very close eye on that neighborhood and Caswell Hill. In my mind, the future of those two neighborhoods has already been determined because I know the demographic of people buying houses and moving into these areas and it is a very progressive, very urban-focused demographic of people moving in.”

Read the 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

Saskatoon real estate week in review: May 24-28 2010

A short week brought declines in both listings and sales to the Saskatoon real estate market. Local agents reported just seventy-three firm house and condo sales this week, a decline of nine from the previous week and well off of the one hundred and thirteen sales reported for the same week last year. With just one more business day for our MLS® in May it appears likely that unit sales will fall below those generated last May. So far this month we have 328 home sales compared to 369 for the same month last year.

New listings of Saskatoon homes tumbled further dropping nearly a third of last week’s volume to just one hundred and nine, down from one hundred and twenty-seven for the same period in 2009.

Click the image for a larger version of the graph.

Still, active residential real estate listings managed to move higher for the seventeenth consecutive week to break the fourteen hundred mark for the first time since the week of June 22-26 2009. Total active listings continue to close the gap on last year’s numbers but still remain slightly lower than the 1502 homes Saskatoon home buyers had to chose from at the same time last year.

The current condominium inventory moved ahead of last year’s numbers finishing the week at 503 units, a gain of just three compared to the same week in 2009, but higher just the same. As of this morning, there are 822 detached houses for sale, down roughly ten percent from the same week last year when 910 of them showed an active status on the Saskatoon MLS® system.

Click the image for a larger version of the graph.

Cancelled and withdrawn listings declined from last week with just thirty-two homes showing activity in those categories. Twenty-three of those returned to the MLS® on the very same day with their “days on the market” reset to zero. Sixty-three MLS® listings adopted a new pricing strategy this week.

Properties priced below the average took an unusually high share of activity this week and pushed the average price of a Saskatoon home lower by more than fifteen thousand dollars compared to last week to just $279,533, its lowest point since the week of March 1-5. The six-week average continued to form a downward curve as it dropped twenty-four hundred dollars from last week to $296,432. That measure still sits about fifteen thousand dollars higher than it was for the same week a year ago. The four-week median was up an equal amount on a year-over-year basis, but showed a drop of four thousand from last week and finished at $285,000.

Click the image for a larger version of the graph.

Overbidding was not a popular approach this week as just three home sellers managed a deal above their asking price, and those that did settled for fairly small bonuses averaging just $183. An additional six sellers accepted an offer at full list price while sixty-four of the seventy-three sales reported this week came in below asking by an average of $7,237, or an average percentage discount of 2.5.

Click the image for a larger version of the chart.

Highlights from the news this week

Canadian home prices expected to drop as costs rise
Overvalued homes, higher mortgage rates drop hot resale market
Home ownership costs rise across Canada
Canadian homes overvalued: CIBC
Rising household debt threatens recovery
Realtors rush to ease correction fears
Bank of Canada should hike interest rates: OECD
Thefts at open houses a new worry
US style correction unlikely in Canada: CREA
Canadians need not fear US style correction: CREA
Price gains slow across country: National Bank of Canada

A map displaying the boundaries of Saskatoon real estate areas is here.
An overview of data collection and calculation practices for our statistical reports is 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.

Our Saskatoon home search tool offers MLS listings represented by all real estate brands, presented with more detail than you’ll find anywhere else. Check it out here.

Norm Fisher
Royal LePage Saskatoon Real Estate

25th Street extension to move forward

A plan to extend 25th Street from 1st Avenue North to Idylwyld Drive will move forward despite a doubling of costs since plans for the project were first approved by city council a year ago. On Monday, council approved a $17 million dollar budget paving the way for work to begin. Utility work will start this summer with road construction following next year. The work should be completed in 2013.

Changes should facilitate a smoother flow of traffic between the Central Business District, City Park,  and the Caswell Hill areas. It should also reduce the number of trains that presently travel through the areas to the switching yards that would move out of the downtown area as a result of the plan.

City OKs street extension

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

Just how vulnerable is Canadian real estate?

I’ve just read “Assessing Vulnerabilities in the Canadian Housing Market,” a five-page report written by CIBC economist Benjamin Tal and released on May 25. If you’re looking for some reassurances that the bottom isn’t about to fall out of the Canadian housing market, you may appreciate Tal’s assessment.

Mr. Tal clearly feels that Canadian housing is overvalued but he doesn’t think there is an unmanageable affordability problem in Canada.

First, Tal believes that “at least 1.5 million houses in Canada are overvalued” and his research indicates that prices on those properties are inflated by as much as 14%. Provincially, British Columbia is the worst with an over valuation of 20.7% and Alberta is the least inflated at 8.6%. Saskatchewan fits neatly between the two at 13.2%, just below the national average.

Tal goes on to say that the market is showing clear signs of cooling and that price growth has “rapidly decelerated” over the past few months. He goes on to suggest that absent a “trigger” to a violent correction, prices will not necessarily crash. According to Tal, rising rates will not be the trigger some believe it to be. He speculates that rates will climb slowly and that most Canadians will be able to manage the costs associated with those changes.

According to Tal and CIBC’s affordability index, which is based on actual transactions as opposed to “synthetic mortgage” assumptions, we can afford it. On average, Canadians are using just 15.6% of their income to make mortgage payments. “Manitoba and Saskatchewan still enjoy the best home ownership affordability in the nation” with just less than 12% of income being used on to service mortgage debt.

The report concludes by saying, “While higher interest rates will clearly erode affordability, our detailed look at the distribution of mortgage payments as a share of income does not reveal major pockets of vulnerability. Accordingly, the most likely scenario is that higher interest rates will lead to a modest decline in prices (probably in the magnitude of 5%-10%) in the coming year or two. But given relatively modest rate hikes and the current balanced affordability position, the more significant adjustment will be in housing market fundamentals that are likely to catch up with prices in the coming years—paving the way for a healthier housing market by mid decade.”

What do you think?

Read to full 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.

Our Saskatoon home search tool offers MLS listings represented by all real estate brands, presented with more detail than you’ll find anywhere else. Check it out here.

Norm Fisher
Royal LePage Saskatoon Real Estate

Lake Placid back in the River Landing game

Following what Mayor Don Atchison described as “the most due diligence that the city has done on any land sale,” an agreement was struck with Lake Placid Developments to purchase “Parcel Y” at River Landing in Saskatoon’s Central Business District for a price of $5,240,494 yesterday.

Star Phoenix writer David Hutton is reporting that “City council, sitting as an executive committee, made the decision in private Tuesday afternoon to advertise the land sale before it was announced at the evening council meeting. The sale still requires the blessing of city council on June 14 because the purchase is for less than market value.”

Recent appraisals on the land suggested a market value of approximately $11 million. Lake Placid had previously purchased the land for $4.8 million but lost it to the city when they failed to meet payment deadlines in October of last year.

On March 22 of this year, Lake Placid CEO Michael Lobsinger appeared before council indicating that he had formed a partnership with Dr. Karim Nasser and that financing had been secured to complete the $200 million dollar River Landing Village previously approved by council.

In mid-April, council agreed to enter into negotiations with Lake Placid subject to an independent audit to ensure that adequate financing was in place to complete the project.

Council will formally vote to approve the sale at the June 14 council meeting after hearing from anyone who might be opposed to the sale. Lobsinger indicates that he’s “ready to move dirt in June or July” and believes that the project can be completed in 36-months.

Read more from David Hutton’s 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.

Norm Fisher
Royal LePage Saskatoon Real Estate