The Altario Quarterly (Jan-15)

The Camrose housing market, Q4 2014

Click HERE to read the entire January, 2015 newsletter, including graphs and Camrose rental and building stats

Happy New Year, everyone!  Or will it be so in the real estate market?
 

I think we all knew that a slowdown of some sort was inevitable but I’m not sure anyone thought it would be so sudden – it’s as if someone flipped a switch on November 1 and created a landscape that was so radically different from the one in which we had all operated for the year prior that it’s virtually unrecognizable.  I don’t think I’m going out on a limb by saying that the dramatic fall in oil prices and some of the other uncertainties in Alberta and the world have changed people’s thinking in a very substantial way and this change is permeating decision-making at every level. 
 

There were 64 sales of improved (i.e., the figure excludes vacant land) properties in Camrose in Q4, which is about average for Q4, but 31 of those 64 sales occurred in October and another 23 in November, leaving only 10 for December.  This low level of activity does, of course, come on the heels of some torrid market activity over the 12-month period ending October 31 but the question is whether it’s indicative of a trend, particularly if oil prices remain low for some time. 
 

We in the appraisal business are naturally affected by changes in market conditions as well and readers might find it interesting to note that our office experienced its slowest-ever 2-month period (in the three years since I took over the business) in November/December in terms of new appraisal orders.  I called one of the appraisal management companies in Toronto to ask whether this was specific to us or to our region and he advised that appraisal orders throughout Canada had dropped anywhere from 20-30% in the time frame I’m describing here.  So, it’s not just a Camrose issue or even just an Alberta issue – it’s country-wide and it remains to be seen how it continues to manifest.
 

Highlights of Q4 2014:

• the 5^th-highest mean (average) price, at $284,614 for any quarter since 2003

• the highest rolling 12-month mean price ever (a record yet again):  $295,399, which represents an increase of 1.5% over the last quarter ($290,895), an increase of 6.3% vs. Q4 2013; however, the rate of increase is somewhat less than that between Q3

• 2013 and Q3 2014 (6.3% vs. 6.5%) and it’ll be interesting to watch this particular trend over the next year relative to the slowdown we now appear to be experiencing

• the 7^th-highest median price ever:  $280,000, which is down from $288,250 in Q3 but up from $265,000 in Q4 2013; the median price in Q1 2008 was $284,900 (note that this is not a rolling average)

• in Camrose, there have been 55 sales of over $400,000 during the past 12 months vs. only 35 sales during the 12 months ending on December 31, 2013; in Q4, there were nine such sales:  four of them occurred in October, three of them in November, and two of them in December

Overall, the graph in the newsletter shows a continued upward trend but, because the trend line represents a rolling 12-month average of mean prices, very little of the questionable market in Q4 is represented there, so this will be the indicator on which to keep an eye.  As this is written, there are 73 residential properties on the market in Camrose via MLS (on the Central Alberta board and the Edmonton board combined), excluding vacant land (vs. 114 at the beginning of October).  If we consider this relative to the 64 sales that occurred in Q4 2014, supply and demand are still in balance, but with a slight bias toward oversupply.  If so, we shouldn’t expect prices to rise over the next while, but neither should they fall to any extent.  That would be the case only if what we’ve seen in the latter stages of 2014 continues apace.

Miscellaneous

In Q4 2014, we recorded 57 sales in the small towns of the area we track daily (as far north as Ryley, Holden, and Viking in Beaver County, as far east as Hughenden in the MD of Provost, as far south as Veteran in the County of Paintearth and as far west as Bittern Lake).  There were 272 total sales in 2014 vs. 239 in 2013.

In Q4 2014, we recorded 20 acreage sales (in all of Camrose and Flagstaff Counties, as well as in the north part of the County of Stettler, the east part of the County of Wetaskiwin, and the southernmost part of the County of Beaver), for a 2014 total of 111.  This contrasts to 109 in 2013.

2014 was a very significant year in terms of change of ownership of downtown commercial property, the likes of which I’ve not seen in my 12-year appraisal career: 7 properties changed hands, including two private ones of which I’m aware – there were almost certainly more private sales than that; this represents a true generational shift in downtown Camrose.

Both Camrose mobile home parks transferred to new ownership in early 2014.

We have records of seven industrial or commercial land sales in 2014; Camrose continues to experience a paucity of industrial land at present, although there were  several industrial-commercial projects initiated in 2014.

The Altario Quarterly (Oct-14)

Click HERE to read the entire October, 2014 newsletter, including graphs and Camrose rental and building stats

Singing the praises of realtors

Most of us have probably seen the commercial in which the 4-man SWAT team bursts into the house, thinking it was Cartel occupying it, but they find only Mr. & Mrs. Lewis.  “Didn’t your realtor tell you about this place?” the SWAT captain asks.  “We didn’t use a realtor,” Mr. Lewis answers.  “Oooh,” the whole SWAT team responds in a combination of pity and incredulity, the message being that realtors can be a critical part of the home buying and selling process. 

 

I’ve always known this, and also always believed that professional work in general should best be left to the professionals, but my experiences over the last couple of months have deeply solidified my view of just how valuable realtors can be.  Now, those of you who read this newsletter regularly would recall a recent piece I did on why we are happy renting at present.  You would therefore be surprised to hear that, as of today, I actually own two residential properties:  my late father’s house in Winnipeg that is just in the process of selling and an investment/vacation property in New Brunswick that my business just bought.  I know -- it’s ironic that we own both of these but still enjoy renting our own home!

My point in telling readers this is that both of these transactions have gone exceptionally well and that is only because of the outstanding service the respective realtors (and lawyers – yes lawyers, as well as several other wonderful professionals) provided for each of the two properties.  The sale in Winnipeg was interesting because the market for modest bungalows in the north part of town there has been through the roof, with properties regularly selling well in excess of list.  In fact, the rules were modified in Manitoba to allow realtors to accept multiple offers and open them all at the same time so that the best one could be accepted.  My realtor there, Lou Furlan, explained all this to me, set the list price just right so that it would attract interest from both above and below that price point, and prepared as good a listing description as I’ve ever seen.  Being September, the multiple offers didn’t come (as they might have in spring), but the house sold at just under list in a matter of six days, so what more could you ask for?  Lou stayed in touch with me throughout the whole process and was worth every penny of the commission charged, as there’s no way I could have navigated through a market in another province without that kind of help.

 

Then there was Lise Thibodeau in New Brunswick.  Although she is associated with an office in Moncton, she serves many of the Acadian communities along NB’s beautiful eastern shore.  She was the listing realtor for the property we were considering in Pointe Sapin, NB, so we went directly to her to view it and, eventually, to make an offer.  She was the consummate professional and handled her dual agency role with the utmost of care and respect for both the vendor and us.  The amount of additional information she provided (including outstanding referrals for water testing, insurance, home inspection, and legal services, to name just a few) was so above and beyond the call of duty, it’s hard to describe, and it’s not like this is a multi-million dollar property but we felt that she treated us just the same regardless.  In the same way that Lou was a God-send in Winnipeg, Lise was all that in New Brunswick.  We simply couldn’t have asked for more.

 

We in Camrose and area are blessed to have all sorts of good realtors in our midst, each one bringing something a little different to the table and most exhibiting the standard of care and professionalism that Lou and Lise exemplify.  Today, I salute each of you and thank you for the hard work you do on behalf of your clients.  If it’s anything like what I experienced, you, too, earn every penny you make.  I’ve seen first-hand what a good realtor can do to help and I agree with the commercial:  working with a professional makes all the difference in the world.

 

The Camrose Housing Market in Q3 2014

If you were expecting a slowdown in Q3 2014, you’ll have to wait for a while yet.  Each quarter in 2014 seems to want to out-do the last and, while there was some slowing in September, the volume for Q3 was the 4^th-highest on record (112 sales) among all quarters that I’ve tracked via MLS and office records since 2003 and was the highest Q3 ever during that time (the next-highest was Q3 2008, with 105 sales).

 

Other highlights of Q3 2014: 

·       the 2^nd-highest mean (average) price for any quarter ever at $299,590, 2^nd only to Q2 2014 at $309,639

 

·       the highest rolling 12-month mean price ever (breaking the record set last quarter):  $290,895, which represents an increase of 1.9% over the last quarter ($285,442), an increase of 6.5% vs. Q3 2013, and an increase of 4.7% since the beginning of 2014 (note that the rolling average is a better indicator of what the market is doing over the long term than is the quarter-by-quarter mean price)

 

·       the 2^nd-highest median price ever:  $288,250 (2^nd only to last quarter at $292,500), which represents a 12.6% increase vs. Q3 2013

 

·        In Camrose, there have been 50 sales of over $400,000 during the past 12 months vs. 44 sales during the 12 months ending on June 30, 2014, which suggests continued confidence in the economy by those with means 

Overall, the gradual upward trend continues, As this is written, there are 114 residential properties on the market in Camrose via MLS (on the Central Alberta board and the Edmonton board combined), excluding vacant land (vs. 146 at the beginning of July).  If we consider this relative to the 112 sales that occurred in Q3 2014, supply and demand appear to be generally still balance.  If so, we should expect a levelling over the next while, particularly as we head into what is usually a slower time of year.

The Altario Quarterly (July, 2014)

Click HERE to read the entire July, 2014 newsletter, including graphs and Camrose rental and building stats

The Camrose Housing Market in Q2 2014
 

What a quarter -- the upward trend continues! While our tracking in Q1 2014 produced the highest rolling 12-month average ever to that point ($280,923), it turns out that this was just a prelude to what was to come in Q2. Q2 2014 exhibited the 2nd-highest number of sales in a quarter that our tracking has ever shown (135 vs. 140 in Q2 2013). However, Q2 also produced the following:  

• the highest mean price for any quarter ever and the first quarter ever to break $300,000 ($309,639); 

• the highest rolling 12-month mean price ever: $282,442, which represents an increase of 1.6% over the last quarter and an increase of 4.6% vs. Q2 2013  
• the highest median price ever: $292,500, which represents a 4.3% increase vs. a year ago
• in Camrose, there have been 44 sales of over $400,000 during the past 12 months, with 21 of these having occurred in Q2 2014 alone!  

Overall, the quarter just passed can be classified as a breakout quarter and 2014 as a breakout year, as the graph in the newsletter suggests. As this is written, there are 146 residential properties on the market in Camrose via MLS (on the Central Alberta board and the Edmonton board combined), excluding vacant land. If we consider this relative to the 135 sales that occurred in Q2 2014 (keeping in mind that Q2 is almost always the busiest quarter of the year), supply and demand appear to be finding a balance, which is in contrast to the significant under-supply that was evident 6 months ago. If that is the case, it’s likely that Camrose will see a levelling of prices over the remainder of the year, although not necessarily a decrease in volume, notwithstanding the seasonal strength of Q2 generally.