Tuesday, April 27, 2010


Calgary luxury home sales surging in 2010
By Mario Toneguzzi,
Calgary Herald
April 27, 2010 6:51 AM

CALGARY - Affluent purchasers moved in the first quarter to take advantage of low interest rates, pushing luxury home sales in Calgary to nearly double what they were a year ago.

Although the high-end market is not on fire like it was a couple of years ago during the real estate boom, it has picked up dramatically from the recession in 2009.

In Calgary, for the first quarter of this year, 67 upper-end properties valued at more than $1 million were sold compared with 35 during the same period last year.

"We felt it in the last quarter of last year with the surge of first-time buyers coming into the market and it creates a catalyst all the way through. It just took a matter of time before it hit the upper-end market really," said Christina Hagerty with Re/Max Realty Professionals.

"There's an overall confidence seen in the Calgary market again. Specializing in the inner city, surprisingly, a good 20 per cent of people I've been speaking with are coming in from other places," said Hagerty.

Those places include Toronto, Vancouver, London and South Africa.

Hagerty said the overall real estate market should experience moderate growth in the years to come, and most likely increases in both prices and in the number of sales by three to five per cent in 2010.

People looking to buy at the $800,000 to $1-million range are taking their time.

"We're not really having bidding wars. We're seeing corrections in the market as well. I think this is one of the last price ranges to make a correction. And now that they're correcting, the buyers are buying them," said Hagerty.

Many of today's luxury buyers are taking advantage of favour-able market conditions to trade up to larger homes or better neighbourhoods, said the Re/ Max Upper End Market Trends 2010 report.

The Re/Max report said older, established areas such as Mount Royal and Elbow Park are popular with upscale purchasers looking for easy access to downtown, while Bearspaw, Elbow Valley and Springbank offer high-end buyers "more bang for their buck -- with country homes typically situated on sprawling lot sizes."

In Calgary, sales of luxury homes still lag 2008, when 86 were sold; 2007, with 124; and 2006, with 86.

The most expensive sale on MLS this year in Calgary was for $5.75 million in Elbow Park.

Re/Max said homebuying activity has improved significantly in the city over the past 12 months, but "purchasers are still cautious, especially in the top end of the market."

The report said some overpriced homes continue to linger on the market with "many risking stagnation."

The recent strength in the local market is due to low interest rates, said Dan Sumner, economist with ATB Financial in Calgary.

"Now the world is looking a little bit more stable," he said. "A lot of these people who were maybe finding the market too expensive in 2007 and 2008, and also a little bit more competitive then, are now saying, 'Hey, we lock into a low interest rate, prices are down a little bit . . . and maybe we can move up from the mid-priced home to the high-end home."

The Re/Max report, which highlighted sales and trends in 13 major Canadian centres and five sub-markets, found that virtually all areas experienced double-and triple-digit increases between January and March of this year over 2009 figures for the same period.

Nine out of the 13 markets examined set all-time highs for first-quarter activity in the upper end.

"Recovery in the upper end has been nothing short of remarkable," said Elton Ash, regional executive vice-president at Re/Max of Western Canada.

Tuesday, April 20, 2010


Housing may have peaked
Gary Marr, Financial Post
Published: Thursday, April 15, 2010

The spring homebuying season has reached a fever pitch with a record number of "for sale" signs being placed on Canadian lawns for the month of March.

But there are indications the market has reached the peak with nowhere to go but down.

The Canadian Real Estate Association said yesterday that 97,663 properties were put on market last month, a 25% increase from the number of new listings in March a year ago. Since the beginning of the new year, there have been 233,402 homes put on the market, the best-ever first quarter for new listings.

With demand still strong, sales continue to soar. There were 49,256 units that traded hands in March, the second-best March on record, and a 40.8% rise from a year earlier.

Yet despite the huge increase in year-over-year sales, March was the fifth straight month that the percentage increase has declined. In some markets, sales are already falling. Seasonally adjusted sales in British Columbia dropped 17.8% from a quarter earlier and Alberta sales dropped 9.7% during the same period.

Phil Soper, chief executive of Royal LePage Real Estate Services, said affordability and consumer confidence drive the market. "The former has not eroded enough to affect the market and the latter has improved considerably," he said.

Still, he concedes the spring market may be the top for real estate. "It will be the top from an industry-volume perspective. It's the last hurrah for the pent-up demand in the market," said Mr. Soper, who expects prices to continue to rise, but more slowly.

Even with the increase in the supply of homes, sales are expected to remain strong this spring as homebuyers scramble before tougher mortgage rules, rising interest rates and the new HST in Ontario and British Columbia come into play - all by July 1.

Many in the industry concede, however, the spring market could be the last gasp before housing sales start to drop, along with prices. Few, however, are predicting a U.S.-style crash.

"If this isn't the top, we are very close to it in terms of sale activity and price," said Gregory Klump, chief economist with CREA.

Mr. Klump doesn't predict the market will reverse dramatically, but says year-over-year comparisons are going to continue to shrink for sales and prices.

Mr. Klump said prices at the high end of the market are going to start driving down because consumers in that segment are trying to beat the clock on all the changes ­coming.

New mortgage rules, which go into effect on April 19, will force consumers to borrow based on the five-year posted rate if they are locking in for a term less than five years. Previously, they could use the actual rate on their contract, meaning they could borrow more.

Banks have also raised long-term mortgage rates in the past two weeks, with a five-year, fixed-rate closed mortgage rising from 5.25% to 6.10%. The Bank of Canada is expected to raise its own benchmark rates shortly and that will affect consumers with floating-rate mortgages now based on a prime rate of 2.25%.

And the introduction of the harmonized sales tax on July 1 will raise costs for some services associated with buying a house, such as a real estate commission. It is coming only to British Columbia and Ontario, but Toronto and Vancouver are the most expensive real estate markets in the country and skew the national averages.

For now, the market still has some wind behind it. "Negotiations still favour sellers during the home-buying process in a number of major Canadian housing markets," said Georges Pahud, CREA's president.

"The rise in new listings means that buyers may shop around more before making an offer."

Photo by: Erik Twight


SUNDAY MAY 30th 2010 10:00AM TO 6:00PM

Sunday, May 30th 2010, marks the date of the 21st annual 4th Street Lilac Festival, and the streets have never been hotter!

In 2009 an estimated 125,000 Calgarians participated in this fabulous one-day festival. They enjoyed the wide array of entertainers that were featured on stages and entertainment zones along 4 th Street in the heart of the Mission district.

In addition, they had an opportunity to shop at over 600 craft, food and entertainment vendors along the 13 blocks of the festival. With something for almost everyone to see and do we had participants dancing in the streets to the smooth sounds and scrumptious tastes. Fourth Street is known for it's diverse cultural restaurants - "you can eat around the world on 4 th " - and those restaurants took to the streets that day selling samples of their fabulous menus.

The Lilac Festival has been voted " Calgary 's best free festival" by FFWD (Calgary 's News & Entertainment Weekly) readers for the last twelve years running.


Tuesday, April 6, 2010


Changes to the Rules for Government Insured Mortgages
Eb Y.H. Chan

Mobile Mortgage Specialist
RBC Royal Bank

On February 16, 2010, Finance Minister Jim Flaherty announced changes to the rules for government insured mortgages. These changes are designed to ensure that Canadians are prepared for higher interest rates in the future and to maintain stability in Canada’s housing market.

We want to be sure you understand the changes and how they might affect your clients home financing options. Three of the new measures that have been announced are as follows:

New Guidelines – Effective April 19th 2010

1) Qualifications for Buying a Home

All borrowers with less than 20% down payment, will be required to qualify at a five-year fixed benchmark rate mortgage; even if they choose a mortgage with a lower interest rate and shorter term. Clients who choose a term of 5 years or greater can be qualified using the bank’s contract rate (current market rate). The 5 year benchmark rate is published by the Bank of Canada and can be found at the following site, http://www.bankofcanada.ca/en/rates/interest-look.html. This change will help to ensure homebuyers can not only afford their home today but for tomorrow as well, in the event rates were to rise.

2) Purchase of Investor Property (Not owner occupied)

Also, as part of these changes, when purchasing an investment property (not owner occupied) the minimum down payment required will increase to 20% of the purchase price. Today, the minimum down payment required at RBC Royal Bank ® is 15 %.

3) Limit the maximum on refinancing:

Borrowers who are looking to refinance their mortgage can currently borrow up to a limit of 95% of the appraised value of their property. The changes announced on February 16th will lower the maximum mortgage amount to 90% of the appraised value of the property. This change will help ensure that homeowners don’t become overextended by using all the equity they have built up in their home when refinancing.


1) Self employed clients with non traditional income confirmation

Effective April 9th changes have been made that reduce the percentage of financing available to clients who are self employed, have been in business for less than 3 years and who cannot provide traditional proof of income.

Clients looking to purchase a home under this program will require a minimum of 10% down payment to be eligible. For clients who are seeking to refinance their existing residence, the maximum percentage of financing available under this program will be reduced to 85%.

Getting pre approved for a mortgage is a great first step in the home buying process, but reviewing that pre approval as a result of these changes is very important. I am here to help to ensure your clients are still on track in achieving their goals of home ownership.

The following is a link to our Home, Mortgage and Lending Advice Centre. http://services.rbc.com/advice/video.html

Photo by: estheticcore


Oil rises to highest price since October 2008
By Joshua Schneyer

NEW YORK - Oil prices rose more than 2 percent on Monday to their highest since October 2008, after U.S. manufacturing, home sales and jobs data boosted optimism about a recovery in the world’s top economy.

The U.S. service sector grew in March at its fastest pace in nearly four years while pending home sales also rose, according to the ISM industry survey and a National Association of Realtors report on Monday.

That added to optimism following Labor Department data released on Friday showing U.S. payrolls rose by 162,000 last month, the fastest rate in three years.

U.S. crude oil for May delivery settled up $1.75 to $86.62 a barrel. Prices have risen by 8.3 percent since March 26, in their steepest 5-day winning streak since December.

Brent crude rose $1.87 to settle at $85.88 a barrel.

“Economic optimists have taken control of the market,” said Gene McGillian, analyst at Tradition Energy in Connecticut.

“We’re in uncharted territory. I think we can keep trending higher.”

U.S. markets reopened after a three-day weekend that included the Good Friday holiday. London markets remained closed on Monday for Easter.

Economic recovery bodes well for higher fuel demand in the United States, the largest consumer of oil. Flagging demand has helped bolster U.S. crude oil stocks, which are currently well above the five-year average.

Analysts polled by Reuters forecast weekly inventory from the American Petroleum Institute, due out on Tuesday, and data from the Energy Information Administration on Wednesday will show the 10th straight week of inventory gains.

Oil, natural gas and heating oil all rose sharply in a broad commodities market rally. U.S. equities moved higher, led by shares in energy companies, as the Standard & Poor’s 500 Index rose to an 18-month high.

The U.S. dollar weakened against a basket of foreign currencies, often an indication that investor funds are flowing away from safe haven assets and into those deemed riskier, such as commodities or equities.

OPEC members, including the world’s largest crude exporter Saudi Arabia, said last week at the International Energy Forum in Cancun, Mexico, that they favored an oil price in the $70 to $80 a barrel range. But OPEC, which pumps more than a third of the world’s oil, has no immediate plans to revise output targets and produce more crude even with oil near $85, a person familiar with Saudi oil policy told Reuters last week.

Crude prices also rose after reports that a South Korean supertanker was hijacked by Somali pirates off of East Africa over the weekend. The tanker, chartered by U.S. refiner Valero Corp., was carrying around 2 million barrels of Iraqi crude oil -- around 2.4 percent of daily world supply -- towards the U.S. Gulf Coast.

Technical analysts, who follow the movement of prices on historical charts, have become more bullish and suggest the oil market could move higher in the next few weeks.

“Our take on crude oil prices in the short-term is that we likely will push higher from here,” said senior commodities analyst Edward Meir at brokers MF Global.

“Technically, there is very little resistance showing on the charts given the upside breakout evident.”

Photo By: braniffelectra