header
August 2013
Real Estate Newsletter
FROM LOUISE FULLER 
In This Issue
1009 Benchlands Trail - Feature Listing
Recovering Canmore to consider ways to repair Cougar Creek
Tide Turning for Alberta's recreational property market.
Calgary Real Estate Sales Up 17 per cent in July
 
Visit My Website to View Fantastic Canmore listings. 
 
Featured Article


, 

If you know anyone who is thinking of buying or selling their home we will ensure they are well taken care of!  

 

Sales for the month of July 2013 are as follows:

 

Single family: 9 sales, average sale price $815,211, average days on market 112 (DOM). 

Half duplex: 2 sales, average sale price $1,034,500, average days on market 133 (DOM). 

Townhouse: 4 sales, average sale price $550,500, average days on market 61 (DOM).  

Apartment: 14 sales, average sale price $413,910, average days on market 97 (DOM). 

Lots: 0 sales.


Please remember these are averages only.    

Best Regards,
Louise Fuller

33 Juniper Ridge  
 

  
Feature Listing

Contemporary masterpiece in Silvertip!

Jeremy Sturgess design, featured in Western Living, Colorado publication Mountain Homes and in British film series on Modern Mountain Architecture. This strikingly unique home and innovative design blends together unusual geometries and thoughtful attention to site details. The vaulted living room, dining room and kitchen area offers outstanding views in many directions. The master bedroom has an open lofted space, walkout deck and unique master ensuite. This 4000+ Silvertip home living area has four bedrooms, three full bathrooms, recreational space and a double car garage. Stunning Panoramic Mountain Vistas fill this contemporary masterpiece in Silvertip. Square footage includes total living area of 4017.

1,788,800

FOR MORE INFO CLICK HERE

 

 

 
CMHC Cap on Mortgage-backed Securities to Hike Home Costs,
Cool Market   

By Julian Beltrame

OTTAWA - Canadians may soon be paying more for new home loans as Canada Mortgage and Housing Corp. begins to clamp down on guarantees for mortgage-backed securities.

The government agency has notified banks, credit unions and other mortgage lenders that they will each be restricted to a maximum of $350 million of new guarantees this month under its National Housing Act Mortgage-Backed Securities (NHA MBS) program.

This year, the federal Crown corporation was given authority to guarantee up to $85 billion under the program but by the end of July, $66 billion had already been committed.

"As a result of this unexpected increase in issuance volumes to date and to better manage volumes going forward, CMHC will be introducing a formal allocation process in late August," CMHC said in an Aug. 1 note to lenders.

Analysts say the cap will make it harder and more expensive for banks to obtain funds to lend to their customers, which would likely be passed on by way of a bump in mortgage rates.

"The combination of steps the government has taken in the last year, coupled with the beginnings of a sell-off in the bond market... will put a bit of upward pressure on mortgage rates," said CIBC chief economist Avery Shenfeld.

"Overall, the days of very cheap mortgages are going to be replaced by cheap mortgages."

TD economist Diana Petramala, who specializes in the housing market, estimated rates could rise anywhere from 20 to 65 basis points, or the equivalent of 0.2 to 0.65 of a percentage point.

She noted that historically, this is a minor increase.

"Affordability will still remain in the housing market," she said.

The conversion of loans into securities with CMHC backing is a way for lenders to tap funds from a broad range of investors and enable banks to issue more mortgages at a lower cost.

Analysts said Canadian banks should have no difficulties securing international markets for funding, but it will come at a higher cost. CMHC-backed securities are attractive for both banks and investors since they are largely default-proof.

Fearing an overheated housing market could infect the larger economy, and result in defaults which the government must bear, Finance Minister Jim Flaherty has taken a number of steps in recent years to stem the flow of mortgage credit.

Last summer, he introduced tighter rules for mortgage lenders and borrowers - a change that the real estate and lending industries say was the main reason for a slowdown in residential property sales that began last August and continued through the first part of 2013.

As well, the finance minister acted to limit taxpayer exposure to a housing crash by setting limits on banks' ability to buy bulk insurance from CMHC.

Still, Flaherty has been frustrated that banks were priming the house mortgage pump too aggressively, oblivious to the fact that Canadian household debt continued to climb. At 165 per cent of annual income this spring, household debt reached heights similar to the peak in the United States prior to the 2007 crash that literally broke several banks.

This spring, the minister went so far as to publicly chastise some banks for dropping their mortgage rates too low.

The moves worked for awhile, but in the past few months, housing has been on an upswing, with starts again reaching unsustainable levels near 200,000 annually, sales picking up and prices continuing to record new highs.

"We are starting to see the impact of the changes wearing off... prices in most markets are now rising faster than income," Petramala said. "So it makes sense that the federal government, CMHC, may want to limit some of the risk-taking in the housing market."

In last month's monetary policy report, the Bank of Canada cited the recent developments in the housing market as the top made-in-Canada risk to the economy.

"This renewed momentum would produce a temporary boost to economic activity and inflation, but more importantly, it would exacerbate existing imbalances and therefore increase the probability of a more severe correction later on. Such a correction could have sizable spillover effects to other parts of the economy," the central bank concluded.


$1M Home Sales Hit 70 in July     

Calgary's luxury real estate market posted record sales in July, when 70 homes exchanged hands for $1 million or more.

Last month's spending spree marked a more than 66 per cent increase over sales in July 2012, when just 42 luxury homes sold in the city, the Calgary Real Estate Board said.


In the first seven months of the year, realtors sold 470 homes worth $1 million or more, compared to 344 purchased during the same period last year, the real estate board said.

More luxury homes were sold between January and July than had been purchased in every 12-month period on record, except 2012, according to Mike Fotiou, associate broker with First Place Realty.

The most expensive home sold last month was in Mount Royal, snatched up for $4.645 million.


Calgary Real Estate Sales Up 17 per cent in July

Experts say flooding may have contributed to increased activity    

CALGARY - The Calgary real estate market saw its busiest July since 2009, but the jury is still out on whether last month's increased activity was connected to the June flooding.

Residential sales for the City of Calgary totalled 2,268 units in July, a 17 per cent increase over the same period last year. Citywide prices were nearly seven per cent higher than levels recorded a year ago, with a July 2013 benchmark price of $414,100.

"We had a big month," said Calgary real estate agent Jim Sparrow. "It's surprising to see this kind of activity ... As the flood waters have gone down, the sales and prices have gone up."

Ann-Marie Lurie, chief economist for the Calgary Real Estate Board, said there is no good way to measure the effect of flooding on real estate sales.

"But yes, there have been people who have been displaced, and renters who have been pushed into ownership a lot sooner," she said.

Another factor, Lurie said, is that people who were already in the market for a home may have decided to hurry their decision over fears that the flood could lead to tightened supplies and increased prices.

Still, Lurie said most of the increased sales volume likely had little to do with the flood at all, and more to do with market conditions. Notably, the strongest growth occurred in the condo market, which saw a 26 per cent increase in overall sales over the previous year. For single family homes, the increase was 14 per cent.

Lurie said the rapid increase in condo sales versus single family homes is due to affordability.

"The single-family market was a seller's market before the condo market was. And as we saw that level of affordable product start to decline, we started to see people start to turn toward the condo market," she said.

Real estate analyst Don Campbell, of the Real Estate Investment Network, said Calgary's statistics are likely to be slightly skewed for the next several months, as the impact of the flooding will influence figures like total listings and days-on-market.

"These numbers will no longer reflect the true direction of the market," he said.

Campbell said he expects demand will remain strong, but added it will be interesting to see where it is focused.

"I think we are going to see a shift in demand toward neighbourhoods on higher ground over the next three to six months," he said.

Tight market conditions remain for both single family and condominiums. Year-over-year new listings increased in July to 1,958 units, but overall active listings declined to 2,917 units, nearly 20 per cent lower than the already declining levels recorded in 2012.

Thanks for reading and I will send you more info next month. 

For all your real estate needs I am ready and willing to help you take that next, very important step. 

Sincerely,

Louise Fuller