Edmonton Real Estate Blog

Weekly Update on the Edmonton Real Estate Market

Here is our update on the Edmonton real estate market. (Previous week's numbers are in brackets). For the past 7 days:

New listings: 660 (608, 709, 762)
# Sales: 287 (245, 299, 300)
Ratio: 43% (40%, 42%, 39%)
# Price changes: 671 (572, 605, 768)
# Expired Listings: 103 (205, 192, 161)
# Canceled/withdrawn/terminated listings: 73 (57, 55, 61)
Net loss/gain in listings this week: 197 (101,163, 240)
Active listings for single family homes: 4371 (4303, 4223, 4163)
Active listings for condos: 3233 (3210, 3147, 3096)

Just the straight good this week due to our hectic weekend moving our office. Good news is we have phones and internet a the new location (more difficult than you might expect).

Our Office is Moving This Weekend!

Normally we're in the business of sending our clients packing, but this weekend it's our turn. We may be a little difficult to get a hold of today and tomorrow because our office is moving. We expect our phones will be out of service temporarily on Friday so email is the best way to get a hold of us.

Our new office is at #200, 10458 Mayfield Rd, Edmonton, AB, T5P 4P4:

I will do my best to get a weekly update up today, but it may have to wait until tomorrow. Thanks for your patience!

4 Simple Ways to Cut Household Costs and Reduce Your Impact on the Environment

There have been a lot of comments on this blog recently about environmental concerns in Alberta, related to the oil sands. Unfortunately I'm no expert on what's going on up there other than a lot of trees are being cut down, a lot of water is being used, and a lot of greenhouse gasses are being released into the atmosphere.

Since this is a real estate blog though, and I majored in Ecology in University, I can comment on other environmental issues related to how we live here in Alberta. Here are some very simple suggestions to conserve that you may not have thought of:

1. Drink tap water. Bottled water produces up to 1.5 million tons of plastic each year and takes 47 million gallons of oil per year to produce. It is estimate 80% of these bottles are thrown away and not recycled (Source: Lighterfootstep.com). Add to that the fact that water is very heavy, and gets trasported across the country and in some cases from across the ocean (think Evian) and there is a very heavy environmental toll to drinking bottled water. Besides, most bottled water is just tap water anyway - Pepsi takes municipal water from Mississauga and Vancouver, bottles it and rebrands it as the purest of waters" (a.k.a. Aquafina) (Source: Macleans). Visit a high end restaurant in California, Toronto or a growing list of other cities and you won't even be able to get bottled water - many restaurants are installing their own tap water filtration units. For your home, you can even install a "healthy home system" much like the owners of this beautiful home in Parkland have (shameless plug....I know).
2. Clean or replace your air conditioning filter. Depending on where you live, air conditioning filters can get dirty in a matter of days. An air conditioner with a clogged filter has to work harder, which means higher power bills and the creation of more greenhouse emissions. Running clean, you can save up to $150 each year. You'll also enjoy the benefit of fewer allergy causing particles in the air, and a more comfortable home or office.
3. Unplug idle appliances and electronic devices. Just because that cellphone charger doesn't have a phone attached to it doesn't mean it's not drawing energy. Devices such as televisions with standby modes can use up to half the power they would draw when turned on. Don't just turn something off: unplug it. The average household can save up to several hundred dollars a year just by pulling the plug on silent energy vampires.
4. Don't idle your car. I can't believe how many people I see in this city that leave their cars running! I can (sort of) understand doing it in the winter (even though the colder it gets the more greenhouse gasses your car puts out, especially when idling) but what is the deal with cars idling, with the windows open on a beautiful day? Starting your car uses 10 seconds worth of gas, so if you're sitting for more than 10 seconds turn it off. While you're at it use your cruise control on the highway for up to a 15-percent improvement in mileage. Driving less aggressively is the single most effective way to save gasoline: accelerate out of lights more gently, avoid rapid braking, and only drive as fast as you must. Skip the drive-through window, park, and walk your business inside whenever possible.

So there you have it, 4 simple things you can do that will have very little impact on your day to day life and can help you make a smaller impact on your environment. (See www.Lighterfootstep.com for more ideas).

Oh, and one last thing, we love getting comments but lets not turn this into a pissing match about the oil sands or anythingn else or we'll have to close the comments.

Top Relocation Tips

So your company is sending you to Bolivia, Timbuktu or maybe Calgary. You have to sell your home and the relocation company contacts you to arrange some of the “stuff.”

They are going to forward you some names of a few REALTORS to contact regarding the sale of your home.  This selection of REALTORS is based not entirely, on competency but mostly on the fact that they’ll pay the relocation company a referral fee of 30–45% of their gross commission. In addition, the agent may have to agree to some unusual reporting and marketing procedures and any other terms the relocation company might require.

So look at it this way: the relocation counselor calls the office and secures a REALTOR who will pay the referral fee, then gives you their name and contact information. In many but not all cases, the client who is moving has the ability to pick their own agent as long as they will agree to the terms of the relocation company.

Almost everything you receive from the relocation company and REALTOR is dependent on the plan your company has with the relocation company.  Some common things relocation companies may pay for are:

• REALTOR Fess
• Legal fees
• Movers
• House hunting trips
• Miscellaneous costs (Surveys ect)

Some companies may prefer to provide their employees a lump sum of money and let them negotiate and pay the costs that they feel will be most beneficial, as opposed to repaying them to the client after the fact.

In rare cases if you are moving to a market that is more expensive than the one you are moving from your company may offer you some type of “cost differential.” For example, lets say the house you have in Edmonton is worth $330,000 and the same or a very similar house in Calgary is $400,000.  They may offer you some incentives to take the transfer and some options to ease the pain of the cost differential.  It could be an interest free loan, maybe a one time moving bonus and so on. In some cases they offer you nothing, and tell you that your job is there and you have to be there by such and such a date or you no longer have a job.

So back to the referral fee. If the relocation company takes 30-40% of the commission off the top, you have to ask yourself is your Realtor going to advertise like they normally would and market the property as aggressively as they would if they didn't have to pay the relocation company?

Many agents who do relocation work are simply awesome, some real estate companies however tend to dole out this business to people who really see it as a nuisance or entitlement.

Here are a few tip$ to get the most out of your relocation experience:

1. Get a copy of your relocation program.  Spend some time understanding this policy.
2. it is extremely important.  If you’re in the Military or RCMP you may be more familiar with your IRP (internal relocation policy) then most people are.
3. Make sure you understand the terms that the REALTOR who is going to represent you has to agree to and how that may affect you. There are some very good REALTOR's who may not take on your home depending on the relocation company's policy.

In many cases the relocation company is only under contract to the employer requesting the transfer and some things may have to be negotiated individually with your Human resources coordinator. If you are dealing with a REALTOR who has done relocation work they should be able to assisst you in these areas. 

Relocating your family can be stressful.  Working with the right REALTOR who has the knowledge of what you are dealing with and the relocation policies and how they might affect you will lower your stress.  In the end this can make your relocation a success instead of a stressfilled nightmare.

Weekly Update on the Edmonton Real Estate Market

Here is our update on the Edmonton real estate market. (Previous week's numbers are in brackets). For the past 7 days:

New listings: 608 (709, 762, 671)
# Sales: 245 (299, 300, 279)
Ratio: 40% (42%, 39%, 42%)
# Price changes: 572 (605, 768, 603)
# Expired Listings: 205 (192, 161, 450)
# Canceled/withdrawn/terminated listings: 57 (55, 61, 71)
Net loss/gain in listings this week: 101 (163, 240, -129)
Active listings for single family homes: 4303 (4223, 4163, 3985)
Active listings for condos: 3210 (3147, 3096, 2953)

The average sale price is still up over last month to $344,123 (April's average was $336,93) and sales for the month are at 1283 - which should put us somewhere around 1700 for the month - perhaps the sales have peaked early this year. Inventory is at a new high of 11,538.

One thing for certain, we were at Hole's last weekend and there were hundreds of people getting gardening supplies who weren't out looking at houses. Who wants to look at houses on the first gorgeous weekend of the year? Who wants to look at houses in the pouring rain....maybe weather has nothing to do with it!

From the inventory analysis, you can really see a pattern forming with new listings...lots of expiries at the end of the month, then new listings peak in the 1st or 2nd week of each month and tail off again.... I guess that means we should have another new crop coming in two week's time. Happy weekend!

Does that come with landscaping?

When you buy a home in the dead of winter, you never really know what's under the snow, but come spring and summer beautiful landscaping can be a real selling feature. So what happens when you purchase a home that had a perfect green lawn, and gorgeous perrenials and trees when you viewed it, and it's all dead when you move in?

The purchase contract used by Realtors in Alberta states that:

"When the buyer takes possession, the Property will be in substanitally the same condition as it was when this Contract was accepted."

In other words, the buyer should be able to expect that if the grass was alive and well when they agreed to purchase the property, it will still be so when they take possession. If things are not as you expect you have to decide what it's worth to you and if it's important discuss it with your Realtor and your lawyer.

I've seen purchase contracts where the buyer and seller agree to have trees and perrenials removed prior to possession (and even stranger things that than). I've also seen agreements where the buyer pays for landscaping maintenance services prior to possession. The best idea is always to keep it simple, don't let a $30 bush stop a transaction worth hundreds of thousands of dollars.

Headlines: Real Estate Boom is Over, No Bubble Coming

For the past couple of weeks I think every major newspaper in Canada has published an article with something similar to the above headline. And almost every article has mentioned the fact that the slumping national sales are mostly due to the slow down in Edmonton and Calgary. It seems all this information comes from a report by the Bank of Nova Scotia.

"Home resales have fallen for four consecutive months, and the inflation-adjusted average resale home price registered its first quarterly decline in seven years during the first three months of this year."

Scotiabank Adrienne Warren said a major national correction — like the slumps that followed the housing booms in the 1970s and 1980s — is not in the cards.

“Our long-term housing price model puts average home prices in 2007 at about eight per cent above their long-term trend, compared with a premium of 12 per cent and 18 per cent, respectively, at the 1976 and 1989 housing cycle peaks,” she said.

Canada’s real estate market is not overbuilt and households are not excessively indebted, Warren added. “At the end of the day, we predict a soft landing for the Canadian housing market, with somewhat lower sales and construction, and a period of relatively flat inflation-adjusted home prices.”

One thing for certain, the market in Edmonton has no tolerance for seller's "testing" the market with a high asking price right now; if a home is not priced sharply it won't even get a nibble from buyers, let alone a viewing or an offer. Even well priced homes are getting a flurry of activity for the first week or two on the market and if there is no offer accepted then interest seems to tail off. There seem to be plenty of window shoppers out there, but these days it seems most will only take the plunge if they smell a deal. The funny thing is average prices are still up slightly over April...

Weekly Update on the Edmonton Real Estate Market

Here is our update on the Edmonton real estate market. (Previous week's numbers are in brackets). For the past 7 days:

New listings: 709 (762, 671, 566)
# Sales: 299 (300, 279, 293)
Ratio: 42% (39%, 42%, 52%)
# Price changes: 605 (768, 603, 493)
# Expired Listings: 192 (161, 450, 115)
# Canceled/withdrawn/terminated listings: 55 (61, 71, 39)
Net loss/gain in listings this week: 163 (240, -129, 119)
Active listings for single family homes: 4223 (4163, 3985, 4088)
Active listings for condos: 3147 (3096, 2953, 2969)

The average sale price is actually up over last month to $348,044 (April's average was $336,93) which is about equal with last June's average but lower han last May.

There have been requests to compare the inventory and sales for condos and single family homes separately instead of lumping them together. I did some analysis and it really wasn't that interesting, but I did find some interesting tidbits. First, the new listings to sales ratio has been is consistently worse for condos than single family homes for quite some time. At the same time, the number of new listings is increasing faster for single family homes than condos, I expect that trend to reverse as all the new condos currently under construction start to come on the market - then we'll see even lower ratios for condos:

Second, the price per square foot for condos seems to be trending down of late, while single family homes is up and down:

Lastly, it's a long weekend which normally means lower activity and sales, so expect to see lower numbers next week. Enjoy the beautiful weather this weekend!

Guaranteed Sales

Recently I had a call from a blog reader who thinks a family member has a gauranteed sale agreement with their REALTOR.  Of this there should be no confusion. 

You either have a Guaranteed Sale agreement or you don’t.

Below are the rules directly out of the Real Estate Act of Alberta as it pertains to all licensed industry members who may provide a Guaranteed Sale agreement.  If they are not licensed industry members, builders or investors who prey on people (mostly people selling on their own) then these rules do not apply to them.

If you are getting involved in a Guaranteed Sale agreement their should be no confusion.  Please take your time and carefully review what you are getting into.  Many brokerages offer them and some have little or no strings attached, while others have more strings then the Edmonton Symphony Orchestra. 

Just know what you are getting into and remember if it sounds to good to be true it probably is.

The following excerpt is directly out of the Real Estate Act.

Guaranteed sale agreement
20(1) In this section, “guaranteed sale agreement” means an agreement in writing under which an industry member or another person on behalf of or to the benefit of an industry member undertakes to pay to the seller of real estate within a fixed or determinable period of time a fixed or determinable amount of money in respect of that seller’s real estate.

(2) An industry member who enters into a guaranteed sale agreement or has another person enter into a guaranteed sale agreement on behalf of or to the benefit of that industry member shall maintain a separate trust account in a bank, loan corporation, trust corporation, credit union or treasury branch in which money payable under this section must be deposited.

(3) When a guaranteed sale agreement is entered into by an industry member or other person on behalf of or to the benefit of an industry member, that industry member shall deposit into the trust account maintained under subsection (2) not less than 5% of the total amount that may be payable under the guaranteed sale agreement.

(4) When money is deposited under subsection (3), it must be held in trust for the seller and must be
(a) paid to the seller or to some other person as directed by that seller as part of the total amount payable under the guaranteed sale agreement,
(b) forfeited to the seller if the seller is not paid in accordance with the guaranteed sale agreement, or
(c) returned to the industry member when, pursuant to the terms of the guaranteed sale agreement, there is no longer any money payable to the seller under that guaranteed sale agreement.

(5) Subject to subsection (6), money deposited under subsection (3) must remain on deposit in Alberta until it is paid out under subsection (4). (6) Section 25(4) applies in respect of a trust account under this section.

(7) When a deposit is forfeited under subsection (4)(b),
(a) the forfeiture does not prejudice any action that the seller may have against the industry member or other parties to the guaranteed sale agreement, and
(b) the money forfeited may be applied toward any sum that the seller may be entitled to receive as damages arising out of the non-performance of the guaranteed sale agreement.

(8) When an industry member or other person who enters into a guaranteed sale agreement with a seller purchases the seller’s real estate pursuant to that sale agreement, no commission is payable to that industry member or other person by that seller in respect of that trade

http://www.reca.ca/industry_standards/pdf/real_estate_act.pdf .

What To Expect When Listing Your Home For Sale

Frequently I get comments from people trying to sell their homes who are frustrated about the marketing of their property. Many of these are sellers who are trying to sell on their own, others have hired a REALTOR and are unsatisfied with what they are or aren’t doing.

I often wonder why these discussions don’t occur beforehand?

He are 4 things you should expect when discussing the marketing of your property:

• AGENCY -  Timely disclosure of agency and your options surrounding agency are required. You have several options and this will form the basis of your relationship with your REALTOR. This discussion should be thorough, and you should be clear on your options and what that will mean for you.
• The EVALUATION -  Some time should be spent understanding your evaluation and the comparable listings and sales, the market trends, absorption and potential issues surrounding the marketing of your home.
• The MARKETING PLAN – The listing contract doesn’t specify all services that are, and can be available to you.  That is NEGOTIABLE between you and your REALTOR.
• The AGREEMENTS - There have been many substantial changes to real estate contracts over the years so depending on when you last sold a property it could take a while to review these.

So if you are going to expect a service you should discuss it up front. If a home owner thinks open houses, or newspaper ads or online ads are important, ask if you Realtor offers these services before signing a contract with them. Ask to see examples. If you assume that everyone does the same thing, then you are taking the risk that they will not be done.

It takes a significant amount of time to review the marketing options and services for our clients and potential clients. Once we are done reviewing this there should be no questions as to what is or isn’t included as far as marketing is concerned. Typically our services are agreed to upfront and this done in writing and attached to the listing contract.

For example, a number of years ago REALTOR opens houses were basically standard practice (the kind where REALTORS came to preview the home at a specific time). However, that seemed to disappear in the late 90’s in Edmonton. Attendance to these open houses dropped to nil with the advent of the Internet; you were lucky if you got people from your own office to go and look at your listings.  So if you haven’t sold a home in a while you might be really surprised if you want a REALTORS open house.

In St. Albert and Sherwood Park though the REALTORS open house is alive and well. This is generally because the market is substantially smaller and you can see new listings in your entire market place in one morning.

Some people have suggested to me that they’d like their REALTOR to have an open house lunch because it was successful in other markets. I know one thing is for certain - I won’t be attending. If it’s on MLS and I have a buyer I’ll find it. If buyers aren't coming to your hom there might be other reasons that should be discussed. 

Even in St.Albert and Sherwood Park if you host a REALTORS lunch, I suspect your turn out might not be what it would be if it was held in the normal time frame of 9:30 – 11:00 on the selected days. However, for the right type of property in the right location I wouldn’t rule anything out.

It’s been almost a decade since I’ve had a REALTORS open house per se. We’ve chosen different avenues to promote our properties and actually take very good pictures of our properties so that buyers and other REALTORS can clearly see what it is we are offering.

All that being said, if you want something badly enough ask for it. Remember though, it’s a two way street - if your requests are unusual, or problematic I might not agree to those terms.