Dave Dry

2011 housing forecast

 The 2011 housing forecast was held this morning by the Realtors association. This year the presenters where all on the same page and optimistic for 2011.

 Just to set the stage a little lets take a look at where we are in the big scheme of things. If you click on the chart below to enlarge it to make it readable you will see that prices are still below 2007. We can see the decline through 2008 and then a bumpy growth through 2009 with the typical increase through May, June and July finishing the year higher than it began.

  In 2010 the market had some challenges 2 rate increases and tightening of mortgage rules early in the year accelerated plans of buyers. This is shown by the early peak in March which precipitated a slow but steady decline to years end. Contributing to this was a over abundance of homes on the market, topping out at over 9,000 residential listings in June and falling back to 5,700 in December.

  Now for 2011. With the unemployment down, job creation on the rise, it is especially good to see this with full time positions.  Migration into Alberta is predicted to be up increasing the demand for homes. Carrying costs are expected to be down in 2011 with marginal interest rate increases. Oil prices on the rise and consumer confidence coming back the overall feeling is that Edmonton will be in good position in 2011, leading to an overall 3% increase with seasonal fluctuations. Prices rising through February to August then falling back a little into December.

Our economic position will be held back somewhat by the slow recovery of the U.S. as they are the number 1 export partner for our commodity based economy.

  Most of the new development is slated for the South end of the city, mainly due to land availability. in the North the city is up against the Anthony Henday, Sherwood park and refinery row in the East and the Henday to the West. With the move again to smaller lots some are predicting the predominate styles in the near future are those with detached garage. Some homes may have the main street in the rear with the front of the house overlooking a green space, park etc without the customary street in front of the home.

 So all in all things look good 2011 with a return to some normalcy in the market, which is good for everyone. Lets hope that the Bank of Canada and the minister of Finance see it that way too.

 As always if anything does happen or looks like it is going to, it will be posted here.