Comment – all the in-migration is what caused the home prices to boom form 200k to 400k in 6 months in 2006 and 2007. This is all happening again right now – as noted below.
The outcome will not be prices going to 600k but well priced homes will move quickly and there will be upward price pressure until most of the excess inventory is moved.
Alberta continues to be a draw for people in other parts of the country.
And that’s good news because in recent months there has been more talk about looming labour shortages in the future.
According to Dan Sumner, economist with ATB Financial in Calgary, 4,720 Canadians relocated to Alberta during the second quarter of 2011, largely unchanged from the 5,275 that moved here during the first quarter. But Alberta is on pace for about 20,000 net-interprovincial migrants in 2011, which if achieved will be the highest annual pace for net interprovincial migration since 2006.
Sumner says the largest net migration gain in the second quarter was from Ontario. Alberta was by far the largest benefactor of net-interprovincial migration in the country with Saskatchewan in second place gaining only 1,239 net migrants.
“Interprovincial migration can be a difficult variable to predict; however, with the unemployment rate lower in Alberta, wages higher, housing prices relatively affordable and the provincial economy expected to grow among the fastest in the country, it’s hard to imagine that more Canadians won’t be calling Alberta home over the near future,” adds Sumner.
“While more skilled workers is essential for the continued development of Alberta’s economy, it also puts pressure on social and institutional resources. As a former premier of this province once stated, ‘when people move to Alberta, they don’t bring their schools and hospitals with them’.”
Don’t forget about Walk of the Pumpkins at the Hidden Hut (10504 Hidden Valley DR NW) Nov 1, 2011 5pm-8pm. Drop off your pumpkins early!!
RT from Robyn Moser
CALGARY — The average price of resale homes in Calgary topped $400,000 in August, according to a report released Friday by the Conference Board of Canada.
The board said all residential property sales in the city hit an average of $404,755 during the month, up from $391,497 a year ago.
The seasonally-adjusted annualized rate of sales also jumped to 22,092 from 18,816 in August 2010.
And the annualized rate for new listings has also increased to 44,940 from 43,536.
The board said the sales to new listings ratio in Calgary increased to 0.466 in August from 0.410 a year ago.
The board also forecasts short-term year-over-year price growth of between five to seven per cent for Calgary.
According to the Calgary Real Estate Board, month-to-date up to and including Thursday, there were 740 single-family MLS sales for an average price of $466,754 and 307 condo sales for an average of $302,460.
For the same period in 2010 up to Sept. 22, there were 682 single-family transactions at an average of $467,486 and 258 condo sales for an average price of $280,790.
© Copyright (c) The Calgary Herald
Her comments below are right on.
Globe and Mail Blog
Posted on Monday, September 19, 2011 6:40PM EDT
A report that showed Canadian household debt levels have topped U.S. ones should be taken with a grain of salt, according to one economist.
In a note released Monday, National Bank of Canada’s Matthieu Arseneau says the Canadian government’s indicator on household debt “does not lend itself well to such an international comparison owing to the considerable differences between the social safety nets of the two countries.”
At first glance, personal disposable income levels appear much lower in Canada than in the United States. Mr. Arseneau attributes that to higher tax levels in Canada that are used, in part, to fund our national health care system.
Americans, meanwhile, must allocate nearly 20 per cent of their personal disposable income to paying for health care, he says. “If we adjust for this factor, the debt ratio of U.S. households exceeds that of their Canadian counterparts by 12 per cent.”
A report released last week showed that Canadian household debt rose to a record high in the second quarter, surpassing levels seen in the United States since the start of the year.
Statistics Canada said last Tuesday that the ratio of household credit-market debt – which includes mortgages, consumer credit and loans – to personal disposable income climbed to 149 per cent from 147 per cent in the first quarter. That’s the highest level since Statscan started gathering figures in this category in 1990.
The government agency attributed the growing debt to higher mortgages and increased consumer credit borrowing.
With interest rates slated to remain at low levels for the foreseeable future, Canadians are taking on both mortgages and consumer loans. Policy makers have expressed concerns about high household debt levels and warned against what could happen if rates were to rise.
In his note, Mr. Arseneau also noted that the Statscan ratio represents only one facet of the financial health of households.
“If we consider the ratio of debt to net worth, which is still markedly higher in the United States, we understand why household deleveraging is ongoing south of the border whereas nothing of the sort is happening in Canada,” he said.
Mr. Arseneau concluded his note by warning of the need to be vigilant, because excessive household debt levels “could represent a risk factor for Canada’s economic stability down the road.”
CALGARY — MLS sales in Calgary rose by 22.1 per cent in August compared with a year ago — a greater year-over-year rate of growth than the rest of the country.
The Canadian Real Estate Association said Thursday that Calgary recorded 1,907 MLS sales for all residential properties during the month for an average price of $394,251, up 2.2 per cent from last year.
New listings in Calgary rose by 11.7 per cent in August to 3,819 and the sales as a percentage of new listings jumped by 4.2 per cent to 49.9 per cent.
In Canada, sales of 39,542 were 15.8 per cent higher than August 2010 and the average sale price of $349,916 was up 7.7 per cent.
New listings in Canada rose by 13.4 per cent to 73,125 and the sales as a percentage of new listings jumped by 1.1 per cent to 54.1 per cent.
“The housing market in Canada remained on a firm footing in August when compared to volatile financial markets,” said Gary Morse, president of CREA. “Through their actions, homebuyers are showing that they remain confident about the stability of the Canadian housing market, and recognize that the continuation of low interest rates represents an excellent opportunity to buy their first home or trade up.”
Gregory Klump, CREA’s chief economist, said economic and financial market headwinds outside Canada are keeping interest rates lower for longer.
“Those headwinds will likely persist until, and indeed after, fiscal quagmires in the U.S. and Europe are resolved,” he said. “In the meantime, the Bank of Canada will have ample reason to delay raising interest rates further, which is supportive for the Canadian housing market.”
© Copyright (c) The Calgary Herald
House prices to get burst of energy
Where oil goes, so goes Calgary.
As much as we like to say the city isn’t as dependent on black gold for its health and prosperity, the fact is, we are.
With oil prices regaining strength and with hiring happening in the oilfields, the economy is beginning to strengthen — and it’s pulling consumer confidence along with it.
A real estate axiom says that when the economy is good, the pace of home sales at the higher end of the market increases.
People in those income brackets aren’t likely to buy if there is an indication the economy is headed south.
“That’s probably true,” says Norb Park, managing broker with Sotheby’s International Realty Canada. “The business-minded are probably saying the economy is heading in the right direction, the oilpatch is in good shape, so this isn’t a bad time to deal.”
Resale housing statistics from the Calgary Real Estate Board tend to agree.
From the start of the year to the end of August, 948 homes priced at $700,000 and more changed hands, up from 779 for the same eight-month period in 2010.
In August, sales in that price range totalled 104 compared with 67 for the same month a year ago.
“There’s a mindset that when oil is doing well, then the economy must be good,” says Park. “That, in turn, increases consumer optimism — and right now, people are feeling positive.”
But not all of us can afford homes that expensive.
Matter of fact, nearly 50 per cent of single-family homes sold this year and last were priced between $300,000 and $450,000.
“With Calgary’s energy sector slated to grow, it is expected to lift the city’s employment, income and in-migration — and in turn help contribute to growth in the resale market,” says Sano Stante, president of the Calgary Real Estate Board. In-migration refers to the migration of people to the city.
“We expect price growth to improve as we approach the end of 2011 and move into 2012,” he says, adding the market is seeing a boost in sales at both ends of the market.
“Improving economic conditions, coupled with affordability and price stability, has given Calgary a boost in buyers for upper-end homes and entry-level condos,” he says.
CREB also reports the average price for single-family resale homes reached $468,051 by the end of August, a one-per-cent increase compared to last year.
Taking a page from the RBC affordability reports, Stante says: “When looking at Canada’s major cities, Calgary is one of the most affordable regions for homeownership in the country. Buyers are benefiting from improved selection at all price ranges in the market.”
The single-family home market had 1,106 sales in August, an increase of 28 per cent when compared to the same month last year — which, by the way, was the lowest for August since 1994.
Sales of 9,485 for the start of the year to the end of August are 10-per-cent higher than the same period last year.
Condo sales totalled 468 units in August 2011, with a year-to-date total of 3,885 — similar to levels recorded in the first eight months of 2010.
Just like the sale of used single-family homes, the pace is also quickening for resale condos.
As of the end of August, 834 units sold at prices below $200,000, well up from 596 for the same eight-month period in 2010, says the Calgary Real Estate Board. But condo prices continue to remain one per cent lower than last year’s figures with an average price of $288,167 for January to August.
© Copyright (c) The Calgary Herald
- Friday, 16 September 2011
According to new data released from the Canadian Real Estate Association, housing activity in Canada remained stable in the month of August, which represents the second month in a row.
“The housing market in Canada remained on a firm footing in August when compared to volatile financial markets,” said Gary Morse, CREA President. “Through their actions, homebuyers are showing that they remain confident about the stability of the Canadian housing market, and recognize that the continuation of low interest rates represents an excellent opportunity to buy their first home or trade up.”
Looking at specific metropolitan centres, Toronto and Ottawa registered a monthly increase in activity, compared with Calgary, Montreal and Vancouver registering slight declines. Year-over-year, actual sales activity nationally rose by 15.8%.
Representing the first time that year-to-date activity has surpassed 2010 levels, 324,030 homes have traded hands, which is also in line with the ten year average.
70% of all local markets were solidly in balanced territory for the month of August, which represents the largest percentage on record. Only 12 markets reported being in buyer’s market position.
The national sales-to-new listings ratio, a measure of market balance, stood at 51.6 per cent in August, unchanged compared to July. The actual (not seasonally adjusted) national average price for homes registered in at $349,916, which marks a 7.7 % increase year-over-year, which was also the lowest price point seen in 2010.
“Once again, economic and financial market headwinds outside Canada are keeping interest rates lower for longer,” said Gregory Klump, CREA’s Chief Economist. “Those headwinds will likely persist until, and indeed after, fiscal quagmires in the U.S. and Europe are resolved. In the meantime, the Bank of Canada will have ample reason to delay raising interest rates further, which is supportive for the Canadian housing market.”
Centres that had been hotbeds for both sales and for price appreciation, that had been having the effect of skewing national prices upwards like Toronto and Vancouver appear to have moderated somewhat, pulling price levels more in line with averages.
Slow Down! Why Some Languages Sound So Fast
Passengers converse with each other on a train line in Tokyo, Japan.
Here’s one of the least-interesting paragraphs you’ve ever read: “Last night I opened the front door to let the cat out. It was such a beautiful night that I wandered down to the garden to get a breath of fresh air. Then I heard a click as the door closed behind me.”
OK, it becomes a little less eye-glazing after that, with the speaker getting arrested while trying to force the door back open. Still, we ain’t talking Noel Coward here. All the same, this perfectly ordinary passage and a few others like it are part of an intriguing study just published in the journal Language — a study that answers one of the longest-standing questions about human speech. (Read why speaking more than one language may delay Alzheimer’s.)
It’s an almost universal truth that any language you don’t understand sounds like it’s being spoken at 200 miles per hour — a storm of alien syllables almost impossible to tease apart. That, we tell ourselves, is simply because the words make no sense to us. Surely our spoken English sounds just as fast to a native speaker of Urdu. And yet it’s equally true that some languages seem to zip by faster than others. Spanish blows the doors off French; Japanese leaves German in the dust — or at least that’s how they sound.
But how could that be? The dialogue in movies translated from English to Spanish doesn’t whiz by in half the original time, after all, which is what it would have to do if the same lines were being spoken at doubletime. Similarly, Spanish films don’t take four hours to unspool when they’re translated into French. Somewhere among all the languages must be a great equalizer that keeps us conveying information at the same rate even if the speed limits vary from tongue to tongue.
To investigate this puzzle, researchers from the Universite de Lyon recruited 59 male and female volunteers who were native speakers of one of seven common languages — English, French, German, Italian, Japanese, Mandarin and Spanish — and one not so common one: Vietnamese. They instructed them all to read 20 different texts, including the one about the housecat and the locked door, into a recorder. All of the volunteers read all 20 passages in their native languages. Any silences that lasted longer than 150 milliseconds were edited out, but the recordings were left otherwise untouched. (Read about the death of a language.)
The investigators next counted all of the syllables in each of the recordings, and further analyzed how much meaning was packed into each of those syllables. A single syllable word like “bliss,” for example, is rich with meaning — signifying not ordinary happiness but a particularly serene and rapturous kind. The single syllable word “to” is less information-dense. And a single syllabile like the short i sound, as in the word “jubilee,” has no independent meaning at all.
With this raw data in hand, the investigators crunched the numbers together to arrive at two critical values for each language: The average information density for each of its syllables and the average number of syllables spoken per second in ordinary speech. Vietnamese was used as a reference language for the other seven, with its syllables (which are considered by linguists to be very information dense) given an arbitrary value of 1.
For all of the other languages, the researchers discovered, the more data-dense the average syllable is, the fewer of those syllables had to be spoken per second — and the slower the speech thus was. English, with a high information density of .91, is spoken at an average rate of 6.19 syllables per second. Mandarin, which topped the density list at .94, was the spoken slowpoke at 5.18 syllables per second. Spanish, with a low-density .63, rips along at a syllable-per-second velocity of 7.82. The true speed demon of the group, however, was Japanese, which edges past Spanish at 7.84, thanks to its low density of .49. Despite those differences, at the end of, say, a minute of speech, all of the languages would have conveyed more or less identical amounts of information.
“A tradeoff is operating between a syllable-based average information density and the rate of transmission of syllables,” the researchers wrote. “A dense language will make use of fewer speech chunks than a sparser language for a given amount of semantic information.” In other words, your ears aren’t deceiving you: Spaniards really do sprint and Chinese really do stroll, but they will tell you the same story in the same span of time.
None of that, of course, makes the skull-cracking business of trying to learn a new language any easier. It does, however, serve as one more reminder that beneath all of the differences that separate Tagalog from Thai from Norwegian from Wolof from any one of the world’s 6,800 other languages, lie some very simple, very common rules. The DNA of speech — like our actual DNA — makes us a lot closer to one another than we think.
Alberta economic growth among Canada’s leaders: 3.7% hike forecast for this year
CALGARY — Alberta is positioned as one of Canada’s provincial leaders in growth, according to the latest RBC Economics Provincial Outlook report released Monday.
The provincial economy is set to grow at a rate of 3.7 per cent in 2011 and 3.9 per cent in 2012, said RBC. Both years Alberta will be second overall in the country behind nation-leading Saskatchewan’s growth rates of 4.3 per cent this year and 4.1 per cent next year.
Continued uncertainty in the global economy and volatility in the financial market forced RBC to downgrade its economic outlook for Canada. It is now predicting 2.4 per cent growth in 2011 and 2.5 per cent growth in 2012 for the country, down from 3.2 per cent this year and 3.1 per cent in 2012 it had forecast in June.
In June, the financial institution predicted economic growth of 4.3 per cent for Alberta this year and 3.8 per cent in 2012.
Increased production at major oilsands projects in Alberta in the past two years has rapidly boosted crude oil output and signs of further acceleration emerged earlier this year, said the report, but wildfires then forced widespread shut-downs in late-May and caused oil production to plummet in the weeks that followed.
“We expect that the negative economic impact from the wildfires will be short-lived, as most facilities were able to resume operations fairly quickly after the fires subsided,” said Craig Wright, senior vice-president and chief economist for RBC. “The economic loss associated with this disaster should be largely recovered in the second half of 2011.”
Solid investment in Alberta’s energy-related sector is the key driver of economic growth at play in the province, added the report. Oil and gas producers are slated to spend more than $24 billion this year, an 18 per cent increase over 2010.
“Continued strength in energy-related sectors will support a slight acceleration in economic growth to 3.9 per cent in 2012, maintaining Alberta’s status as a growth powerhouse,” said Wright. “This has had a positive impact on employment, as more than 77,000 jobs were added to the Alberta economy in the first eight months of this year, which was the strongest gain ever recorded over this period in the province.”
© Copyright (c) The Calgary Herald
I love this data below as it is easily summarized into: World events mean that mortgage rates in Canada are going to stay low for about another year. This is great news for people in the variable as rates (Prime) were expected to rise and they are not going to for a while now. Fixed rates will also stay low too so everyone wins.
If you are not sleepy right now then do not bother to read the rest of this below. Perhaps bookmark it for a sleepless night and use the powers of economic speak to zonk you out then.
On Wednesday September 7, 2011, 4:51 pm EDT
Watching the Bank of Canada’s language on the economy change over the past year is like seeing a healthy, upbeat person gradually come around to the idea that a serious illness is overtaking them.
A year ago, the central bank was continuing the slow process of raising its key interest rate toward familiar levels, as the western world began to put the financial cataclysms of 2008 behind it. On Sept. 8, 2010, the target rate for overnight loans between banks rose to one per cent.
And here’s how the world economy looked to the Bank of Canada — getting better, but though not steadily: “The global economic recovery is proceeding but remains uneven, balancing strong activity in emerging market economies with weak growth in some advanced economies,” the Bank of Canada said in September of 2010.
And Canada’s economy — buoyed by demand for commodities like oil, gas, uranium and fertilizer — was recovering: “The Bank now expects the economic recovery in Canada to be slightly more gradual than it had projected in its July Monetary Policy Report (MPR), largely reflecting a weaker profile for U.S. activity,” the central bank’s statement read at the time.
It was canny, however, about forecasting any further increases in rates, sensing possible trouble ahead: “Any further reduction in monetary policy stimulus would need to be carefully considered in light of the unusual uncertainty surrounding the outlook.”
That was code for don’t get too excited, folks: a lot could still go wrong — and it did.
Remember that for more than a year, from April 2009 to June 2010, the central bank’s key rate had been 0.25 per cent — effectively zero, or maximum stimulus, as a rising Canadian dollar did some of the bank’s inflation-cooling work and the world began to recover its appetite for Canadian commodities.
The bank had gradually increased its key rate over the next few months to 0.75 per cent. Then came the bump to one per cent exactly a year ago.
Since then, as Europe’s debt problems have flared in Greece, Ireland, Portugal and Spain, and in some people have taken to the streets to protest government attempts to curb spending and remain solvent, the Bank of Canada’s key rate has been rock steady at one per cent.
Now watch how the language has moderated, as central bank economists saw the economy flattening:
On Oct. 10, leaving the rate at one per cent, the bank said: “In advanced economies, temporary factors supporting growth in 2010 — such as the inventory cycle and pent-up demand — have largely run their course and fiscal stimulus will shift to fiscal consolidation over the projection horizon .… The combination of difficult labour market dynamics and ongoing deleveraging in many advanced economies is expected to moderate the pace of growth relative to prior expectations. These factors will contribute to a weaker-than-projected recovery in the United States in particular.”
By Dec. 7, it saw recovery “largely as expected,” but sounded the first note of bigger trouble ahead: “At the same time, there is an increased risk that sovereign debt concerns in several countries could trigger renewed strains in global financial markets.”
On Jan. 18, 2011 — happy new year! — there were signs the economy was rebounding all too well, with government spending in the U.S. and Canada showing up in growth all over. As well, Canadian commodities remained hot sellers, pushing up the value of the Canadian dollar.
In fact, the bank said, “the cumulative effects of the persistent strength in the Canadian dollar and Canada’s poor relative productivity performance are restraining this recovery in net exports and contributing to a widening of Canada’s current account deficit to a 20-year high.”
Translation: “No need to raise interest rates.”
On March 1, the recovery kept pushing ahead, driven by exports, but the bank left rates unchanged, and stuck with this now-boilerplate paragraph at the end of its release: “This leaves considerable monetary stimulus in place, consistent with achieving the 2 per cent inflation target in an environment of significant excess supply in Canada. Any further reduction in monetary policy stimulus would need to be carefully considered.”
On April 12, the bank forecast 2.9 per cent gross domestic product growth in 2011 and 2.6 per cent in 2012 — all good, with robust spending and business investment leading investors to “become noticeably less risk-averse.”
And yet, searching the horizon for clouds, the bank saw enough to stick with its boilerplate: “This leaves considerable monetary stimulus in place, consistent with achieving the 2 per cent inflation target in an environment of material excess supply in Canada. Any further reduction in monetary policy stimulus would need to be carefully considered.”
By May 31, however, the bank began to see some of its more horrible imaginings coming true, and the boilerplate was dropped. Again leaving the key rate at one per cent, the bank said global inflation might be growing, but “the persistent strength of the Canadian dollar could create even greater headwinds for the Canadian economy, putting additional downward pressure on inflation through weaker-than-expected net exports and larger declines in import prices.”
Stimulus might be “eventually withdrawn,” it said, but “such reduction would need to be carefully considered. ”
On July 19, the bank’s language noted slower-than-expected U.S. economic growth, Japan recovering at a lower-than-expected pace from its nuclear disaster, and said “widespread concerns over sovereign debt have increased risk aversion and volatility in financial markets.” In other words, investors were getting jumpy about how Europe might pull itself together without major defaults and weakened currency.”
And on Wednesday, laying out all the factors that are besetting global growth and the Canadian economy, the bank finally sounded a doctor facing a sick patient.
It didn’t explicitly suggest returning to more stimulus (lowering interest rates), as some economists had forecast it might, but the bank no longer expected to withdraw economic stimulus:
“In light of slowing global economic momentum and heightened financial uncertainty, the need to withdraw monetary policy stimulus has diminished. The Bank will continue to monitor carefully economic and financial developments in the Canadian and global economies, together with the evolution of risks, and set monetary policy consistent with achieving the 2 per cent inflation target over the medium term.”