The Edmonton Real Estate Blog, Market Information, Advise & Opinion

Just How Much Traffic Does REALTOR.ca Get?

Ever wonder how effective organized Real Estate is compared to the online sell-it-yourself website marketing companies? This is eye opener and very powerful. This is the reason so many people want to be on Realtor.ca including these sell-it-yourself companies.

Check out this infographic image for 2011 Realtor.ca website traffic statistics then download the .pdf for your own use.    

Interesting, just because you are on the public Realtor.ca website doesn't mean your property will get sold. In fact, the absorption rate in Edmonton is less than 20%. What is the absorption rate? That's when you combine active listings with new listings divided by sold listings equals the Absorption Rate. Being full time REALTORS®, we keep our finger on the pulse of Edmonton's Real Estate market. If you have detailed questions about this information, please give us a call & we'll be glad to sit down with you over a cup of coffee and explain it.

According to the REALTORS® Association of Edmonton, the average price of housing remained relatively stable through April as compared to the previous month. The all-residential average price decreased $310 to $327,415; down from $327,725 in March. Single family home prices decreased $425 while condo prices rose $1,305 (0.6%) during the month. Despite the activity the market is balanced without a distinct advantage for either buyer or seller.

"Prices and sales usually increase in the second quarter and REALTORS® are busy serving new and repeat customers," explained REALTORS® Association of Edmonton President Chris Mooney. "The increase in new listings means that there is a good selection of homes to choose from. However, the market is still price sensitive and sellers will have to have a realistic pricing strategy if they are expecting a quick sale."

Residential sales were 1,487, down 7.8%; compared to 1,613 in March. Residential listing activity rose from 2,958 units in March to 3,278 units in April. Inventory of homes on the Multiple Listing Service® increased from 6,885 last month to 7,215 as of April 30.

The average price of a single family detached home in April was $379,075 with a median price of $357,000. Condo average price was $234,220 with a median of $220,000. Duplex and rowhouse prices rose on average from $294,585 to $300,906, a 2.1% increase. All prices reflected sales across the entire Edmonton region including surrounding communities and counties.

"There is a lot of activity in the local market and the situation changes every day and from neighbourhood to neighbourhood," said Mooney. "Only your REALTOR® has access to the most up-to-date sales activity and sold prices. He or she is prepared to work closely with you to locate your next dream home or sell the property that no longer meets your lifestyle needs."

According to the REALTORS® Association of Edmonton, residential sales in the first quarter are normal for this time of year although lower than 2010 numbers because of the abnormalities imposed on the previous market. There were 3,479 residential sales in the first quarter, which is down from 3,890 last year.

“We will see sales number bounce back as we move into the spring market period,” said REALTORS® Association of Edmonton President Chris Mooney. “All the fundamentals for this market are positive. There is job stability, low unemployment, income growth and in-migration. New home builders are busy and I expect buyers to be looking at the housing options which match their lifestyle changes.”

At the end of March, the average* residential price (includes all types of housing including condos) was down 4.6% from a year ago at $327,725. The average price of a single family detached home was down to $378,912 compared to 2010 (a -2.6% change) and condos were priced down 7.5% year-over-year at $232,706.

As the market picks up momentum, prices inch up each month with the average residential price up 4.8% from a month ago. Compared to February, prices for SFDs were up 5.8% and condos up 0.8%.

“REALTORS® expect that prices will continue to climb slowly through the next quarter as usual,” said Mooney. “We are already seeing strong sales in the lower end of the market but tighter mortgage qualification rules have slowed sales in the upper end. Sellers should review their asking prices or consider minor home improvements that will appeal to the potential buyer.” Mooney urged both buyers and sellers to contact their REALTOR® to get assistance and advice on home selection and pricing strategy.

REALTORS® listed 2,960 residential properties in March and sold a total of 1,503 properties. Current residential inventory is 6,885 up 7.8% from last month. The residential sales-to-listing ratio in March was 45% with days on market down from 58 to 50 days. Total MLS® System sales this year are $1.235 billion.

Highlights of MLS® System activity

¹. Residential includes SFD, condos and duplex/row houses.
². Single Family Dwelling
³. The middle figure in a list of all sales prices

David Larock in Mortgages and Finance
 
I’ve had a lot of calls lately from borrowers who are wondering if now is a good time to refinance their mortgage, so I thought I’d write a summary to help my readers answer that question. Today’s post will outline a step-by-step process and offer some suggestions where appropriate (this exercise should take you 30 minutes or less). You may find this information to be complex so feel free to call me and we’ll walk through the analysis together over the phone. Here then, is my guide to determining whether now is a good time to refinance your mortgage.

1. Calculate your mortgage penalty. If you have a variable-rate mortgage, your lender will normally charge you three-months interest on your current mortgage balance. If your mortgage rate is fixed, your lender will charge you the greater of three-months interest or “interest rate differential” (IRD), also using your current balance. Explaining the formula for IRD is complicated, so I suggest that you use my penalty calculator as a shortcut. If you have a fixed interest rate and your mortgage is with a Big Five bank, enter the posted rate that was offered at the time you obtained your mortgage in the “Current interest rate” field (unfortunately, this will arbitrarily double the size of your penalty, which isn’t fair, but until Mr. Flaherty addresses this issue, there’s not much we can do about it). My calculator will give you a reasonable estimate, which is a good start, but if you decide to refinance, you’ll eventually have to call your lender to get the exact amount.  

 Suggestion: Keep in mind that if you are planning to pay out your existing mortgage, you should first take advantage of your lump sum prepayment allowance as outlined in your mortgage terms (lenders will typically allow you to make additional lump sum payments that are between 15 to 20% of your original mortgage balance each year). If you have a line of credit (which can be paid off at any time with no penalty), consider using it to pay down your mortgage before you discharge. This will lower your mortgage balance (which is used to calculate your penalty) and you can roll that line-of-credit debt into your new mortgage in short order. While most borrowers don’t do this, it’s an easy way to reduce the size of your payout penalty.

2. Compare your current rate to today’s rates. Generally speaking, if you have a five-year fixed-rate mortgage at 5% or higher, or a variable-rate mortgage priced at prime or higher, a refinance is well worth considering. In simple terms, you want the savings from your new rate to be greater than the cost of any penalty plus refinancing costs such as legal fees, appraisals, etc. ($750 is a reasonable estimate for refinancing costs). My mortgage cost comparison calculator will help you follow this step. 

Suggestion: If you’re planning on borrowing at a variable rate as part of your refinance, increase it by between .75% and 1.5% when comparing it to your existing rate. Assuming a higher average variable rate ensures that you are making a conservative estimate of any potential savings.  
 
3. Add the savings realized from including any other debts in your refinance. If you have other credit-card or unsecured debts with higher interest rates that you are planning to roll into your new mortgage, don’t forget to factor in these savings as well. Refinancing high-interest debt into your mortgage will increase your cash flow and save you money, even in many cases where breaking your existing mortgage involves a substantial payout penalty. If you want help organizing your financial details so you can see how much a refinance will save you overall, feel free to use my debt consolidation calculator.

Suggestion: If you currently have an insured mortgage and you want to increase your loan amount, you will be required to pay a top-up premium on the difference between your original loan amount and your new loan amount. The fee CMHC charges depends on the amount of your equity remaining in the property. Here is the pricing table they use (see column on right). Be sure to factor the cost of your top-up premium into your refinancing costs.    

The most important tip I can give you: For a refinance to make sense, it should both save you money and increase the amount of cash you have left in your pocket at the end of the month. As you undertake your refinance, and before you get used to having the newly saved extra money around, consider putting some or all of it back into your mortgage. You have the option of setting your scheduled payment above the lender’s required minimum and doing so will help you become debt free faster.

To use an example, assume that you are refinancing into a new $300,000 mortgage at the current variable rate of 2.25% using a 25-year amortization. If you set your mortgage payments higher by pretending that you are paying the current five-year fixed rate of 4%, and if the variable rate averages 3% over your five-year mortgage period, you will have paid off a little more than $10,000 of extra principal in just five years by the time your renewal rolls around. In most cases this is a painless exercise because chances are your old mortgage rate was higher than 4%. So you end up with more cash in your pocket AND you’ll be paying off your mortgage faster.

I realize that today’s post is fairly technical, but if you use the calculators and tools I have provided, you should be able to work through the suggested steps. Having said that however, if you’d rather have me take you through the process personally, just send me an email or call. Instead of wondering whether you could be saving money and paying off your debts faster by undertaking a refinance, let’s put your current borrowing costs to the test and see what the numbers say.

Single family detached properties sold for $359,934 on average* in February; up 1% from January. The February price was down 3.1% from a year ago but close to the $349,810 price in February 2009. Condo prices followed the same pattern. At $230,911 on average, condos were up 4.5% from a month ago but down 0.65% year over year. In February 2009, condos sold for $229,685. The average price for a duplex/rowhouse in February was $303,440; up 2% from January but down 5.6% from a year ago. In 2009, the February price for this category was $288,379.

"Sales and prices in early 2010 were pushed up by the impending mortgage rate increases and qualification changes," explained REALTORS® Association of Edmonton President Chris Mooney. "Now that the market is stable, price levels have returned to the 2009 levels. However, the price increases for all housing types from January indicate the slow upward movement that local REALTORS® anticipated."

The all-residential average price (including single family, condo, duplex, townhouse, mobile home and other residential housing types) was up three quarters of a percent from January but down 1.8% from a year ago. However, at $312,840 it matched the February 2009 price at $310,488.

REALTORS® listed 2,631 residential properties in February and sold a total of 1,044 properties. Current residential inventory is 6,389 up 13.4% from last month. The sales-to-listing ratio in February was 39% with days on market down from 67 to 58 days. "With the recent announcement by the Bank of Canada that interest rates are not being raised, consumers can have confidence in the strength of the local real estate market," said Mooney. "Call a REALTOR® to begin your house search."

Highlights of MLS® System activity

¹. Residential includes SFD, condos and duplex/row houses.
². Single Family Dwelling
³. The middle figure in a list of all sales prices

he average price of a single family detached property in the Edmonton area continued to soften in November. According to the REALTORS® Association, at $362,657, the average SFD price was half a percent lower in November than it was in October. Compared to a year ago the price was down significantly by 2.5%. November condo prices also took one of the biggest drops this year with the average price down 2% to $229,603 month-over-month and just under 3% year-over-year. Average duplex/rowhouse prices of $318,605 went up over the previous month (6%) and previous year (10.6%).

Despite the softening of prices in specific categories, overall the market remained stable with the all-residential average price of $319,479 (up 0.65%) from October and up a third of a percent from last year. There were 1,120 residential sales on the Edmonton MLS® System in November as compared to 1,077 in October. Listings were down from 2,267 in October to 1,860 in November. This resulted in a drop in the available inventory from 7,689 to 6,982 residential units; still considered high for this market.

"Softening prices, a dip in interest rates, increasing sales nationally and excess local inventory all contributed to a month-over-month sales bump," said Larry Westergard, president of the REALTORS® Association. "Housing affordability in Edmonton is lower than the national average and economic growth in Alberta is expected to exceed other parts of the country."

The sales-to-listing ratio in Edmonton and area was 66% and the average days-on-market was down from 60 to 59 days. Taken together the two figures indicate that sellers must exercise patience as they wait for a buyer.

2. Serious buyers have fewer houses to choose from during the Holidays and less competition means more money for you!

3. Since the supply of listings will dramatically increase in January, there will be less demand for your particular home! Less demand means less money for you!

4. Houses show better when decorated for the Holidays!

5. Buyers are more emotional during the Holidays, so they are more likely to pay your price!

6. Buyers have more time to look for a home during the Holidays than they do during a working week!

7. Some people must buy before the end of the year for tax reasons!

8. January is traditionally the month for employees to begin new jobs. Since transferees cannot wait until Spring to buy, you must be on the market now to capture that market!

9. You can still be on the market, but you have the option to restrict showings during the six or seven days during the Holidays!

10. You can sell now for more money and we will provide for a delayed closing or extended occupancy until early next year!