# Real Estate Purchase in Calgary



## Westerncanada (Nov 11, 2013)

What are your thoughts on this market the next 4-10 months? As many people have said, although we are going through a bit of a recession and have high job losses it really has not affected the Detached Home price more then a few %, where it has climbed at a high rate for the past several years. 

I would like to look to purchase here but am wondering if I would be better to continue to wait. 

Any thoughts would be appreciated.

WC


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## jargey3000 (Jan 25, 2011)

wait.


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## Just a Guy (Mar 27, 2012)

I don't understand why people think real estate operates the same way as say the stock market. Real estate moves slowly, over years. It a glacier pace compared to other forms of investing. Rates are locked in for nearly 5 years for the majority of people. People move, on average, every 7 years. It takes almost 7 years of ownership to reach break even on selling a place assuming no appreciation...

If you get involved in real estate, you have to start thinking in terms of years, if not decades, not months. Real estate corrections usually follow ecconomic ones after a couple of years. 

That being said, unlike the market, there are always exceptions to the rule. If you want to buy, and aren't super picky (as in I want a specific house) make sure you've got everything lined up and start looking. The house you want may come up at the right price anytime, but if it's low, you'll need to jump on it right away even in today's market because people's thinking hasn't changed yet.


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## Westerncanada (Nov 11, 2013)

jargey3000 said:


> wait.


Wait until. .. q1 2016? 2017?


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## Westerncanada (Nov 11, 2013)

Just a Guy said:


> I don't understand why people think real estate operates the same way as say the stock market. Real estate moves slowly, over years. It a glacier pace compared to other forms of investing. Rates are locked in for nearly 5 years for the majority of people. People move, on average, every 7 years. It takes almost 7 years of ownership to reach break even on selling a place assuming no appreciation...
> 
> If you get involved in real estate, you have to start thinking in terms of years, if not decades, not months. Real estate corrections usually follow ecconomic ones after a couple of years.
> 
> That being said, unlike the market, there are always exceptions to the rule. If you want to buy, and aren't super picky (as in I want a specific house) make sure you've got everything lined up and start looking. The house you want may come up at the right price anytime, but if it's low, you'll need to jump on it right away even in today's market because people's thinking hasn't changed yet.


I am not looking at it from an investment standpoint for short term game.. i am more concerned with buying when prices are held strong and may drop along with the heavy oil driven economy. 

So far, calgary hasnt had any meaningful decline like they have had in previous oil driven recessions. 

Just not sure if i should wait a year or just prep now (which i am) so im ready to purchase


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## Just a Guy (Mar 27, 2012)

I wasn't just talking about an investment, the market reacts the same way regardless. My bet is, you'll see a correction much more so in a few years, even though the economy is stagnant in Alberta today. Oil has to be down a while before people will panic and think about downsizing.


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## Westerncanada (Nov 11, 2013)

Just a Guy said:


> I wasn't just talking about an investment, the market reacts the same way regardless. My bet is, you'll see a correction much more so in a few years, even though the economy is stagnant in Alberta today. Oil has to be down a while before people will panic and think about downsizing.


I agree with you. . And i certainly do not want to buy now and be a part of that correction if i can avoid it.


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## sags (May 15, 2010)

People will have been living off their severance packages, unemployment benefits and savings, and spousal earnings.

It takes about a year until finances get a little tighter. How is the job market for those laid off in the oil and related industries ?

Are people finding replacement work ?

Housing is all about jobs. It doesn't matter what the interest rate is if they haven't got a steady decent income from employment.

Late this year, and early 2016 the outlook should be clearer. Oil prices may rise, but it remains to be seen if oil companies will immediately rehire or wait.

It is going to be a tough year or two for Alberta, and Calgary in particular.

When the big US crash hit.........one of the biggest indicators were the moving companies.

Were the moving companies moving people in..............or moving them out of the state, was a good indicator of the local economy.

For all the macro analysis...........you can't beat the "on the ground" evidence..........moving companies, coffee shop talk, people who know people...........

Home owners are stubbornly attached to their homes. They will cut back on a lot of other spending, before they sell their homes.

People with little equity in their homes, who find their home values are less than their mortgages, can't very well sell unless they want to own a debt without the house.

Home owner determination to keep their homes by spending less, feeds into the local economy and jobs. As consumers cut back spending, businesses slow down and cut back on employees. It means an increasing number of people are caught up in the downward spiral.

For a mass selling of homes..........it almost comes down to home owners being forced out of their homes by the bailiff.................


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## OnlyMyOpinion (Sep 1, 2013)

sags said:


> People will have been living off their severance packages, unemployment benefits and savings, and spousal earnings.
> It takes about a year until finances get a little tighter. How is the job market for those laid off in the oil and related industries ?
> Are people finding replacement work ?
> Housing is all about jobs. It doesn't matter what the interest rate is if they haven't got a steady decent income from employment.
> ...


^+1 I'd be patient. Prices are softening, condos are down already. Use the time to save towards your down payment, furnishings, or emergency savings. Check out CREB regularly and get to know what's listed and for what price. Know what area you want to be in, transit, schools, etc.


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## sags (May 15, 2010)

Maybe it is different in other places, but I have never found there were no homes for us to buy.

And I always found that regardless of what homes we owned, and we owned some very nice homes..........I could pick up a real estate booklet and find 100 others I liked more.

It is like the 2 foot axiom in boating. Everyone wants a boat that is 2 feet longer than what they own. 14 foot......16 foot.......18 foot.......20 foot......

I thought we had fixed up our rental townhouse pretty sweet, until I watched some real estate porn on television.

I barely wanted to live in our "hovel"..................so I googled some images of how Chinese retirees live.............and am back to being happy again.


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## Westerncanada (Nov 11, 2013)

sags said:


> Maybe it is different in other places, but I have never found there were no homes for us to buy.
> 
> And I always found that regardless of what homes we owned, and we owned some very nice homes..........I could pick up a real estate booklet and find 100 others I liked more.
> 
> ...


Chinese Living is a great perspective on how crazy things are here in the developed world.. 

I requested a pre-approval from my broker and they came back at $750,000, and I told them that is crazy and i don't plan on spending half of that much.. but scary to think anyone would leverage 3/4 a million to buy a home regardless of the reason. 

Given my situation I will continue to wait and see what the fall/spring brings for home sales. The CREB is a great resource so thank you for suggesting that above

Cheers,


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## Valueinvestor (Dec 10, 2014)

What is the median home price in calgary now versus 2014?


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## OnlyMyOpinion (Sep 1, 2013)

Valueinvestor said:


> What is the median home price in calgary now versus 2014?


Check http://www.creb.com/Buyer_Resources/Housing_Statistics/


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## Berubeland (Sep 6, 2009)

Anytime you can rent cheaper than you can buy is probably a good time to rent.


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## Westerncanada (Nov 11, 2013)

Just as an update.. after several discussions with folks locally in the industry, the general consensus is pricing is going to go down between now and March and they think the price will stabilize and start to climb after oil stabilizes into the summer. 

That said.. I'll make sure i line up a few places and possible put some low offers in here and there well I wait it out. 

Cheers


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## OnlyMyOpinion (Sep 1, 2013)

Thanks for updating us. Good luck.


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## scorpion_ca (Nov 3, 2014)

Lots of small companies started to lay off people in September......this is just the beginning......some of the small companies also going under the water. 

Those who were laid off, got good severance package and you can live certain time with that package....Those who are telling that oil price will stabilize in the summer, I think they are smoking pot. Job prospective would be worst in 2016 than 2015 in Calgary.


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## Westerncanada (Nov 11, 2013)

scorpion_ca said:


> Lots of small companies started to lay off people in September......this is just the beginning......some of the small companies also going under the water.
> 
> Those who were laid off, got good severance package and you can live certain time with that package....Those who are telling that oil price will stabilize in the summer, I think they are smoking pot. Job prospective would be worst in 2016 than 2015 in Calgary.


So far.. Calgary is down 2% ytd in 2015 despite the price of oil thats dropped 50%. I know its a comparison loaded with variables.. but definitely no way 2% decline is the real estate bottom here.


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## Feruk (Aug 15, 2012)

Westerncanada said:


> Just as an update.. after several discussions with folks locally in the industry, the general consensus is pricing is going to go down between now and March and they think the price will stabilize and start to climb after oil stabilizes into the summer.


Oil price HAS stabilized. Expect $40 to $60 oil for the next few years; there's nothing to move prices up around the bend. Next summer? Ha!

However, companies aren't caught up staffing wise and real estate hasn't caught up either.


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## Westerncanada (Nov 11, 2013)

Feruk said:


> Oil price HAS stabilized. Expect $40 to $60 oil for the next few years; there's nothing to move prices up around the bend. Next summer? Ha!
> 
> However, companies aren't caught up staffing wise and real estate hasn't caught up either.


What do you mean by real estate hasnt caught up?


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## Feruk (Aug 15, 2012)

Real estate = lagging indicator of mass layoffs and salary reductions. 35,000 already laid off in Alberta and I wouldn't be surprised if that number doubles by end of Q1 2016; it wouldn't be an "out there" estimate. When you eliminate some of the highest paid positions in Calgary, you just get on a treadmill waiting for their severance to run out. Biggest round of layoffs we're likely to see is Q4 2015, so if you expect average packages of ~8 months, September's a pretty good bet for when people will start to get desperate, but likely not the low. Everyone who I've talked to that was in the oil patch in the 1980's expects this recession to be worse.

Unless you can get a steal of a deal, I'd consider real estate in Calgary uninvestable for now.


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## nobleea (Oct 11, 2013)

Westerncanada said:


> What do you mean by real estate hasnt caught up?


He/she means that some companies still have staffing levels lined up with 60-70$ oil rather than 40-60. So more cuts would be coming. And it'll be at least 6 months before you start seeing significant drops in RE prices in Calgary. Those who have been (and will be) laid off are typically professionals that get some pretty decent severance packages, so they can all hold out for a decent time. But when the money runs out and the mortgage still has to get paid, that's when the blank hits the blank.


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## peterk (May 16, 2010)

No way I'd buy anything just yet. More layoffs to come in the high-salary category for sure, and more importantly, lower salaries for those high-salary people going forward for a number of years, even if oil does recover fully... Things aren't going to be the same anymore. 

Plus the belt tightening mentioned earlier in household budgets, which will affect local consumer spending, which will affect retail staffing levels and hours worked for low-pay employees, which will cause many people to move for cheaper rent, which will reduce rental rates, which will reduce the value of the second investment property that the high-salary worker owns, and will be forced to liquidate to continue paying the mortgage on his residence, which will drive down housing prices.

All of this will take time of course. I'm not touching a home in Alberta until we see a sustained upswing in oil prices and rehiring.


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## Westerncanada (Nov 11, 2013)

peterk said:


> No way I'd buy anything just yet. More layoffs to come in the high-salary category for sure, and more importantly, lower salaries for those high-salary people going forward for a number of years, even if oil does recover fully... Things aren't going to be the same anymore.
> 
> Plus the belt tightening mentioned earlier in household budgets, which will affect local consumer spending, which will affect retail staffing levels and hours worked for low-pay employees, which will cause many people to move for cheaper rent, which will reduce rental rates, which will reduce the value of the second investment property that the high-salary worker owns, and will be forced to liquidate to continue paying the mortgage on his residence, which will drive down housing prices.
> 
> All of this will take time of course. I'm not touching a home in Alberta until we see a sustained upswing in oil prices and rehiring.


Any estimated timeline on this? 

Would it not make sense to purchase if you could do so at a very steep discount?


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## nobleea (Oct 11, 2013)

Westerncanada said:


> Any estimated timeline on this?
> 
> Would it not make sense to purchase if you could do so at a very steep discount?


You won't know whether it was a steep discount or not until a few years from now. Getting a house for 5% off the appraised or whatever value won't feel like much of a deal if it slides another 10% after that.
For your average 500K house in Calgary, a steep discount would be 100K or so.

I think it depends what your market is. If you're looking for something under say 500 or 600K, waiting might not get your much. But if you're in the market for a million dollar infill, then for sure wait as these are the homes owned (or even speculated) by the high priced professionals who are/will be getting laid off. I think you'll see the higher end market suffer more than the lower end.


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## Westerncanada (Nov 11, 2013)

nobleea said:


> You won't know whether it was a steep discount or not until a few years from now. Getting a house for 5% off the appraised or whatever value won't feel like much of a deal if it slides another 10% after that.
> For your average 500K house in Calgary, a steep discount would be 100K or so.
> 
> I think it depends what your market is. If you're looking for something under say 500 or 600K, waiting might not get your much. But if you're in the market for a million dollar infill, then for sure wait as these are the homes owned (or even speculated) by the high priced professionals who are/will be getting laid off. I think you'll see the higher end market suffer more than the lower end.



As an example.. i viewed a home that was listed for $475K.. and after my realtor pulled the last 8 years of sales on the home there were 2: 


2010: listed for $459K for 90 days but did not sell 
2013: Listed at $449K and Sold at $438K
2015: Listing for $475K

Clearly priced in here is the the build up in home prices in the city over the last 5 years and they feel they may be able to get this or close to it for an offer. 

After area assessment of recent home sales for comparable units.. Current Fair Market Value is around the $460-$465K Mark. 



Despite the slowdown and although the prices will undoubtedly go lower next year, i think being able to get a home like this in the $435K Range today would be a very significant discount given the Market Value currently etc. 

More too it then this.. but well I wait on the sidelines, I am going to keep an eye on a few key properties and see if something comes up in this range that sits on the market for a bit where the owners are very motivated to sell and may need to move a home for breakeven etc.


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## Sampson (Apr 3, 2009)

This is not a huge discount, 8.5% below list.

Ask your realtor to pull all the sales in the neighborhood. Often, most houses can be had a 5% below ask, except in extremely hot markets, and we are definitely not in one.

The other problem with your numbers is that you are completely missing what happened in 2008-09. the critical numbers you need to look at are how much the value dropped during the great recession, and how similar of an event do you predict for this time. Many areas in Calgary dropped by 20% in 2009 and 2010. In that recession, certainly the global magnitude of the crisis was larger, but the effect on the oil patch was short, oil prices did not stay depressed for long. I would believe that what will will come to the Calgary RE market will be more significant.

Also keep in mind that that Calgary market pricing distribution is multi-modal. Lots of houses above $750k, and many around $350k. Depends on what community you are looking at, and whom the primary market for houses in that community are.


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## OurBigFatWallet (Jan 20, 2014)

Average sale price for September in Calgary down 6%: http://www.cbc.ca/news/canada/calgary/calgary-home-sales-and-prices-slide-in-september-1.3252571


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## Westerncanada (Nov 11, 2013)

OurBigFatWallet said:


> Average sale price for September in Calgary down 6%: http://www.cbc.ca/news/canada/calgary/calgary-home-sales-and-prices-slide-in-september-1.3252571


Wow.... the creb numbers came out and the median has now dropped 5.96% YTD and 10% the first two days of October.


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## atrp2biz (Sep 22, 2010)

What does this actually mean? Can one conclude that average home values are down 6% No. All it means is that average sale prices are down 6%. Could it mean there are more transactions for lower value homes as compared to higher value homes? What would happen to the stat if several $8 million homes (in value) sold for $6 million? Would the average sale price for the market not go up?

In other words, all real estate sale prices/data (good or bad) should be taken with a grain of salt.


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## nobleea (Oct 11, 2013)

atrp2biz said:


> What does this actually mean? Can one conclude that average home values are down 6% No. All it means is that average sale prices are down 6%. Could it mean there are more transactions for lower value homes as compared to higher value homes? What would happen to the stat if several $8 million homes (in value) sold for $6 million? Would the average sale price for the market not go up?
> 
> In other words, all real estate sale prices/data (good or bad) should be taken with a grain of salt.


Calgary's a big enough market that what you suggest is unlikely to happen. IF it does happen, it's because there's more sales in the lower priced homes since the people who would normally be in the market for the higher priced ones are laid off. If they reported the median sale price was also down?


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## atrp2biz (Sep 22, 2010)

It would be interesting to see a histogram of the number of sales in various price ranges (and a comparison to last year) to see if this is the case. The $1 million+ homes simply aren't moving--but there still seems to be lots of volume on the low end.


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## Sampson (Apr 3, 2009)

atrp2biz said:


> It would be interesting to see a histogram of the number of sales in various price ranges (and a comparison to last year) to see if this is the case. The $1 million+ homes simply aren't moving--but there still seems to be lots of volume on the low end.


There's supply all over. Actually I have been seeing a lot of inventory in neighbourhoods that are traditionally quiet (high demand communities). This has to say something. I do think there are lots of people on the sidelines, especially considering how cheap money is these days. The question is what will prompt/trigger the fall... will enough people lose their jobs?

Also a question of how much the low-end will be met by the increase in density and condos being built. Thankfully I am not in the market, it would be stressful...


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## Westerncanada (Nov 11, 2013)

Sampson said:


> There's supply all over. Actually I have been seeing a lot of inventory in neighbourhoods that are traditionally quiet (high demand communities). This has to say something. I do think there are lots of people on the sidelines, especially considering how cheap money is these days. The question is what will prompt/trigger the fall... will enough people lose their jobs?
> 
> Also a question of how much the low-end will be met by the increase in density and condos being built. Thankfully I am not in the market, it would be stressful...


I agree.. and the other factor is the messaginf realtors are giving their clients who are selling and i think right now from what i hear they are telling them the market is tough and they may need to be flexible on price to move a unit in a timely fashion.


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## Feruk (Aug 15, 2012)

atrp2biz said:


> What does this actually mean? Can one conclude that average home values are down 6% No. All it means is that average sale prices are down 6%. Could it mean there are more transactions for lower value homes as compared to higher value homes? What would happen to the stat if several $8 million homes (in value) sold for $6 million? Would the average sale price for the market not go up?
> 
> In other words, all real estate sale prices/data (good or bad) should be taken with a grain of salt.


Average vs median.


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## atrp2biz (Sep 22, 2010)

I agree supply is across the board, but my point is that the higher value homes are not moving and that transactions are occurring on the low end. So if average sale prices fall by x%, it doesn't allow one to conclude that home values are down by x%. The only way one can make this conclusion is under the premise that the distribution of transactions (low to high end real estate) remain unchanged. I'm also not arguing the opposite--all I'm saying is that real estate information should be taken with a grain of salt.


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## atrp2biz (Sep 22, 2010)

nobleea said:


> Calgary's a big enough market that what you suggest is unlikely to happen. IF it does happen, it's because there's more sales in the lower priced homes since the people who would normally be in the market for the higher priced ones are laid off. If they reported the median sale price was also down?


That's exactly my point--I was stating the contraposition.


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## nobleea (Oct 11, 2013)

atrp2biz said:


> That's exactly my point--I was stating the contraposition.


It's a somewhat valid point, but what it implies is even worse than an X% drop in average prices.
I wouldn't want to be a developer trying to unload a 1.1mil infill semi at the moment.


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## atrp2biz (Sep 22, 2010)

Well no, if sales data were comprised of a bunch of high-priced properties despite being sold under 'market' value, average sale prices would go up. Sales data doesn't look at relative value--it just looks at the sale price itself.


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## Sampson (Apr 3, 2009)

atrp2biz said:


> Well no, if sales data were comprised of a bunch of high-priced properties despite being sold under 'market' value, average sale prices would go up. Sales data doesn't look at relative value--it just looks at the sale price itself.


This is hugely important for the OP to understand.

Actually I personally believe the market for homes in the $350k to $450k range is strong enough to prevent significant price decreases. Money is so cheap these days, that even people earning well below average salaries in town can 'afford' them. The majority of new migrants are in the 25-44 age range, and probably still looking for housing.


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## fraser (May 15, 2010)

We are back in Calgary and watching the market. Our agent says homes below 450 are moving. Big issue with homes in the 600-800 range and million plus is a dead market. 

Lots of games going on. The CREB stats do not tell the entire story.

We had a printout done yesterday. 28 properties on the list in the 450-900K range. At least 41 (12 of the 28) percent of those properties had price reductions since they were first listed. That percentage is LOW because many just let the listing expire and then re list at a lower number. These do not show up on the stats as price decreases nor are they accounted for in the days outstanding stats.

We are holding tight. You only have to visit a shopping centre in Calgary to understand what is going on. Take a look at the lines for the cash register. Yes, what lines is more the question. Our cab driver from the airport earlier this week told us cab business in Calgary is down 50 percent. Could be an exaggeration but it is down, way down. Condo market is tough and has already seen a significant decrease. So happy we sold two years ago and walked from the market.

Our agent told us yesterday that some lenders are paying close attention to, and shying away from, prospective mortgage borrowers where the qualifying wage earners BOTH work in the oil industry (why I do not know because other business are being negatively impacted).

We are seeing lots of crap, quickie low end renovations that for us actually decrease the value of a home.

We have a friend who rents a two bedroom condo in a 3 year old building in Cochrane. She is moving up the hall to an identical unit. The difference...rent decrease from $1700 to $1300 month. Owner of her new rental has been trying to sell for months and decided to rent. That is a $4800. after tax annual saving. She can do a lot with that saving.


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## Sampson (Apr 3, 2009)

fraser said:


> Our cab driver from the airport earlier this week told us cab business in Calgary is down 50 percent. Could be an exaggeration but it is down, way down.


I guess Uber and Car2Go probably have quite a large influence on this.


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## OurBigFatWallet (Jan 20, 2014)

I would love if Uber came to Calgary


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## Sampson (Apr 3, 2009)

See, what do I know, somehow I thought/assumed it was already here...


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## Just a Guy (Mar 27, 2012)

"They walk among you" wait, those are Rider fans...

"They drive among you".


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## Sampson (Apr 3, 2009)

Just a Guy said:


> "They walk among you" wait, those are Rider fans...


This has been decades now. I suppose we can no longer say the majority of migrants to Calgary are from Saskatchewan, probably BC, maritimes and newfoundland, and foreigners are much larger proportion, but boy, starting early 90's McMahon stadium was no longer red during riders games.


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## Westerncanada (Nov 11, 2013)

Sampson said:


> This has been decades now. I suppose we can no longer say the majority of migrants to Calgary are from Saskatchewan, probably BC, maritimes and newfoundland, and foreigners are much larger proportion, but boy, starting early 90's McMahon stadium was no longer red during riders games.


Very sad week in Calgary with several people i know getting severanced and getting to work only to find out there job is no longer there. 

I do feel awful for them.. but i also feel this added pressure on the real estate market will contribute to more downward pressure into November and further through into the new year.


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## Sampson (Apr 3, 2009)

Westerncanada said:


> but i also feel this added pressure on the real estate market will contribute to more downward pressure into November and further through into the new year.


Good the you have come around... Things will get worse from hear.


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## fraser (May 15, 2010)

We get updates on our list of 30 odd properties. We had 4 automatic notices of price decreases on those properties on Friday. My guess is people are trying to get some traffic on the long weekend. 

Yes, it a very difficult time and I fear that it will get worse by Dec/Jan. My heart goes to these people.


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## Westerncanada (Nov 11, 2013)

fraser said:


> We get updates on our list of 30 odd properties. We had 4 automatic notices of price decreases on those properties on Friday. My guess is people are trying to get some traffic on the long weekend.
> 
> Yes, it a very difficult time and I fear that it will get worse by Dec/Jan. My heart goes to these people.


Fraser, i just shot you a private message on the topic but i think with your previous post about lines and business slowing down it is certainly very evident in the region. The real question becomes how long before the economic slowdown runs its course and actually damages real estate pricing to the point of a technical housing correction?

When you look at the last bust in 2008 (granted it was sharper and steeper drop/recovery) home prices definitely took a much quicker hair cut then our current situation. We have been nearly a year at these oil prices and the market is just barely softening.


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## Just a Guy (Mar 27, 2012)

Back in 2008, lending froze overnight. It was pretty tough to get a mortgage for a couple months. Probably a good reason why the housing market took a short term drop. People in Alberta still had money though, and lots of it.

This time is different, with no recovery of oil prices in sight, many are looking at their bank accounts and beginning to wonder if they will be able to continue. Too many people, despite high incomes, were still living paycheque to paycheque. Of course, people will cut other spending first, trying to hold onto their homes but, without a change in their job prospects, eventually they may be forced to sell...it will, of course, take time.


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## OnlyMyOpinion (Sep 1, 2013)

I wonder how much 'future inheritance' money or bank-of-mom-and-dad money will get used to help out?
(not making a judgement about whether it should or shouldn't, just wondering if it will be a factor here)


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## Westerncanada (Nov 11, 2013)

Just a Guy said:


> Back in 2008, lending froze overnight. It was pretty tough to get a mortgage for a couple months. Probably a good reason why the housing market took a short term drop. People in Alberta still had money though, and lots of it.
> 
> This time is different, with no recovery of oil prices in sight, many are looking at their bank accounts and beginning to wonder if they will be able to continue. Too many people, despite high incomes, were still living paycheque to paycheque. Of course, people will cut other spending first, trying to hold onto their homes but, without a change in their job prospects, eventually they may be forced to sell...it will, of course, take time.


It will be interesting to see how much time.. I think fundamentally it has already changed (Job loss, Severances, pay cuts, no new hires) it's just a matter of the trailing affect on the economic conditions.


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## fraser (May 15, 2010)

We are watching a segment of homes in Calgary. List has about 29 homes on it at present. It is an MLS based pull.

Over half of the homes have had price decreases. We had three price decrease notifications on the Friday of the last long weekend. Just got notices of two additional price decreases this morning.

This, combined with increased Calgary layoffs and poor projections for oil prices have served to 'cool down' our shopping. We are happy renting. May look at the market again in Feb. or if something that is market priced comes along. Some of the current pricing simply does not reflect market conditions. And the CREB stats are not reliable nor do they tell the real story.


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## scorpion_ca (Nov 3, 2014)

As you are happy with renting, I would recommend to rent until the end of 2016. I think house prices will decrease a lot next year because most of the O&G companies will not spend as much as they spent this year. There will be more layoffs beginning of the next year.


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## Sampson (Apr 3, 2009)

fraser said:


> This, combined with increased Calgary layoffs and poor projections for oil prices have served to 'cool down' our shopping. We are happy renting. May look at the market again in Feb. or if something that is market priced comes along. Some of the current pricing simply does not reflect market conditions. And the CREB stats are not reliable nor do they tell the real story.


I would keep my eye on the market. I think the decline will be gradually and steady, but also try to take advantage of seasonality. The Winter season can be quite advantageous for buyers, from the combination of reduced supply + what is happen with layoffs etc.

The news from Cenovus today is pretty bad.


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## fraser (May 15, 2010)

Agree. And there is more bad news on the way.

We are going to take anther look in Feb.


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## Feruk (Aug 15, 2012)

I read today that vacancy rates have gone up 4X from last October! Now at 5.3% (vs 1.4% this time last year).

http://www.cbc.ca/news/canada/calgary/calgary-vacancy-rate-nearly-quadruples-oct-2015-1.3299748


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## scorpion_ca (Nov 3, 2014)

It will not take much time to go to 10% vacancy rate.


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## fraser (May 15, 2010)

We had another 2 price reductions this week on the 28 homes that are currently on our search list.


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## tygrus (Mar 13, 2012)

I have an ear on the street in cowtown

1. Layoffs ramping up again before xmas and after bonus season
2. Large proportion of those positions will never be refilled again even if oil stabilizes upwards of $80
3. large proportion of projects will never go ahead and be mothballed indefinitely

Canada probably stuck at a mid -level producer (i.e approx 3+ MMBBL per day) for whatever life cycle oil has left in it over the next few decades. We will get some revenue from it, but it won`t be gangbusters up to 8 MMBBL like was once the plan. Some pipeline will make it to the coast, probably energy east and transmountain. Keystone not needed but might get a token approval from a democrat govt. Gateway DOA. Too much LNG coming next.


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## Westerncanada (Nov 11, 2013)

tygrus said:


> I have an ear on the street in cowtown
> 
> 1. Layoffs ramping up again before xmas and after bonus season
> 2. Large proportion of those positions will never be refilled again even if oil stabilizes upwards of $80
> ...


I wanted to update the group here that I did end up purchasing a place despite my desire to wait a market opportunity presented itself to get a place for $100K less then it sold for in 2007 (Market peak etc) and $78K less then current appraisal value. Very happy with the purchase at this discount, and prepared to weather further drops in price. 

As a result in paying $100K less i am able to pay almost double my mortgage every month in pre-payments and should have a very short life cycle in the mortgage etc at the current rate. 

As always, i appreciate everyones feedback!


Cheers,


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