Dave Dry

July newsletter

What do these statistics tell us?

  The month of June as we can see turned out to be rather interesting as; most of the market seemed to remain relatively stable with the exception of condominium prices, taking a bit of a hit, to the tune of $9,227. What do I attribute this to? From my experience, and after talking to some of my colleagues, there appears to be an influx of lower priced properties on the market, combined with a healthy group of investors looking to re stock their real estate holdings, bringing down the average sale price. As we start to feel more confident in the economy, we also feel more confident in investing our money and not “putting it under the mattress”. The promise of continued low interest rates through the summer, and fear of rising rates in the fall have spurred these investors into action.

 A big boost to our confidence has come in the form of continued growth in spite of the fact that the US government is in a quandary as to how to pay its bills. I believe that the economic downturn in Canada, while real with real effects, was more emotionally than economically driven, our fear that being tied so closely to the US would drag us down too. Yes there were some that lost their job, their homes and some are still what we call upside down, meaning they owe more on their properties than they could sell them for, the majority of us still have our jobs and a roof over our heads. By way of comparison I know of a home in a stable area of the north eastern US, not one of the worst hit by any means.These people have paid an interest only mortgage, common in the US, for 7 years, this means that they still owe the bank what they bought it for. It was valued a 49% of its purchase price a few months ago. By comparison Edmonton is down only 6% from the peak in July 2007.