Archive for October, 2014

October 15 2014 – Market Update

Tuesday, October 21st, 2014

Lacombe Market Update – Sales in the first two weeks in October were down compared to the same period last month.  The number of active listings is up slightly and spread between the first time/move up market and the high end of the price spectrum.  A little slower market is normal at this time of year, especially after an exceptional first three quarters where central Alberta sales are up 12.1% over the same period last year.

A strong real estate market is a function of a strong economy.  Oil prices are down which is not good, but the dollar is down as well which means oil company revenues and government royalties stay relatively high.  The new premier is spending lots of money on construction and will continue to spend until the election in 2016.  All in all the future looks bright.

Housing construction continues at strong pace – Todd Hirsch, Chief Economist, ATB Financial – Home builders in Alberta ended the summer of 2014 on a high note when construction started on a near record number of new homes.  The Canada Mortgage and Housing Corporation reported yesterday that housing starts in Alberta totaled 47,105 in September. This figure is adjusted for seasonality, and represents starts on an annualized basis—that is, the number of new homes that would be started if the pace set in September was maintained for twelve months.

Housing starts in Alberta are up 6.6 per cent from August. Over the last twelve months, they’ve risen by an astounding 17 per cent compared to the previous twelve month total. It’s also the second highest month for housing starts since the end of the last big construction boom hit the province in 2006-2008. The only other month that has seen higher numbers was June of this year.

The surge in housing starts is in response to strong demand, much of it driven by in-migration to the province. It is also consistent with the strong demand for existing housing, which is reflected by the sales and prices of homes on the market over the past year. For now, Alberta’s economy is creating enough new jobs—and keeping wages high enough—to sustain this pace of home construction. There is little to suggest that builders are creating a real estate bubble by putting too many homes onto the market.

Job market roars back to life in September – Todd Hirsch, Chief Economist, ATB Financial – After shedding jobs over the summer, Alberta’s labour market was back in high gear at the beginning of fall. The 21,200 jobs added last month marked the highest monthly increase in over three years and one of the biggest jumps on record for the province. About two-thirds of the new jobs were full-time positions. (All figures are seasonally adjusted.)

Alberta’s unemployment rate fell to 4.4 per cent, a drop of half a percentage point from August. The unemployment rate in the province has fluctuated between four and five per cent, representing a healthy, balanced job market. Alberta has added over 54,000 jobs over the last twelve months, most of these in manufacturing, educational services and construction.

The jobs report also had good news for the country. Canada’s economy added 74,000 jobs, the majority of them full-time. Ontario, which has suffered from very slow job growth over the last year, saw the largest increase with almost 25,000 new positions. Saskatchewan also added 7,000 new jobs. The national unemployment rate fell two-tenths of a percentage point to 6.8 per cent—the lowest it’s been since December 2008. Alberta’s strong job results last month more than made up for the large number of jobs lost over the summer. With over 11,000 jobs shed in August, some may have worried about the health of the province’s economy. But one month of data is never a trend. Taking the last several months into account, Alberta still appears to be the place to be for job seekers.

LA Oct 15 2014.pdf

RE/MAX Housing Blog: a Mom’s Advice: Preparing Your Home for Baby

Thursday, October 9th, 2014

By Deborah Kearns, RE/MAX Senior Editor, Corporate Communications

This spring, we welcomed a healthy baby boy to our family. His happy addition expanded our family from three to four. It also expanded the housework, cleaning and laundry tenfold now that we have two kids!

I admit, it hasn’t always been easy. After a few exhausting weeks, we eventually settled into a rhythm, a productive albeit at times chaotic, one.

What helped were the steps I took before he was born.

1. Take stock and declutter. Before the baby arrives, it helps to declutter your home as much as possible – for your own sanity and to make room for all the baby gear you’ll acquire. Paring down unnecessary belongings and furniture is a great way to add some simplicity to your now-very-busy life.

2. Baby-proof your home in stages. You don’t have to do it all at once! To save time and money, childproof your home as your baby shows signs of reaching milestones like rolling over, sitting up, crawling and walking. Here’s a great guide from Parents.com.

3. Make the nursery functional. It’s tempting to want to re-create the immaculate nursery designs you see on Pinterest, but my advice is to put function first. Ease and practicality should take precedence over style.  Install window coverings that block out UV rays to help keep the room comfortable and dark during sleep times.

4. Check those smoke detectors. You might not think of this in the hustle and bustle, but testing the smoke and carbon monoxide detectors in your home is extremely important. We have smoke detectors in every room, and a carbon monoxide detector on every level. The U.S. Fire Administration has many resources to help you choose and install these critically important devices.

Have your own tips to share on prepping a home for a new baby’s arrival? Share them below! And if you’re looking for more space for your little addition(s), ask Dawn Parent to help you find the right place.

 

October 5, 2014 – Market Update

Thursday, October 9th, 2014

Sales in Lacombe in September remained very strong while the number of active listings continued to fall.  Those lower inventory levels are pushing the market closer toward seller’s territory and keeping prices firm.  The number of active listings has fallen almost 30% since the peak in June and July, probably due to a lack of building lots.

When pondering the future of central Alberta, the story remains pretty much the same – strong in-migration from other provinces driven by a strong job market, high wages and low taxes.  In April, May and June of this year, Alberta gained a net 13,204 new people from other parts of the country (the difference between the number of in-migrants less the number of out-migrants). That is the equivalent of Alberta adding another city the size of Camrose to its population in a matter of 3 months.

Part of the reason for our strong economy is that our oil is making its way to market by train.  New markets mean higher prices for producers and more royalties for the government who will be spreading the money around before another provincial election in 2016.

September 15, 2014 – Market Update

Thursday, October 9th, 2014

The Lacombe market remained strong in the first two weeks of September, often a time when things slow down a little during the back to school frenzy.  Sales were constant with the same time in August and also with the same time in September of last year.  In the meantime, the number of active listings are down, which will keep prices strong.

We are often asked what the market is going to do in the future.  While no one can predict the future, the following articles from ATB are strong indicators that the future looks very promising in central Alberta.

Alberta’s Population Projected to Climb – Todd Hirsch, Chief Economist, ATB Financial – The number of people living in Alberta will grow no matter what, according to the latest population projections by Statistics Canada.  The present population of Alberta is 4.1 million. Under six various growth scenarios, the province’s population will range from a low of 5.6 million to a high of 6.8 million by the year 2038. The high growth scenario would essentially see the addition of another Calgary, Edmonton and Red Deer combined over the next 24 years.

“In all scenarios, population growth in Alberta would be the highest among Canadian provinces over the next 25 years,” said the statistical agency in a press release this morning. It also notes that these projections are not forecasts. Forecasts suggest what will most likely occur in the future; projections represent an attempt to establish plausible long-term scenarios.

Under the same growth scenarios, Canada’s total population will grow from its current 35.2 million to anywhere between 39.4 million and 47.8 million in the same time frame. A longer-term population projection for the country could see it reach 63.5 million by the year 2063.  Economic trends are not considered in the exercise of population projections. Rather, Statistics Canada bases its assumptions on trends in fertility, life expectancy and migration. The latter of these—migration—is deeply tied to the economic performance of the province. As we’ve seen in recent quarters, Alberta’s strong job market continues to draw thousands of interprovincial and international migrants.

Oil and Gas producers Busier in Second Quarter – Todd Hirsch, Chief Economist, ATB Financial – More oil and gas rigs, drilling equipment and heavy transportation vehicles were being used in the spring of 2014 compared to earlier quarters. According to this morning’s Statistics Canada figures, the industrial capacity utilization rate in Canada’s oil and gas extraction industries rose to 88.0 per cent. That’s the highest rate in 11 years.

The industrial capacity utilization rate is a measure of existing slack in the economy. It is the ratio of an industry’s actual output to its estimated potential output, given the fixed amount of buildings, factories, machinery and equipment currently available. The closer the ratio is to 100 per cent, the less slack there is in the system.

Nationally, industrial capacity also tightened to a utilization rate of 82.7 per cent, the highest since the second quarter of 2007. Statistics Canada reports that manufacturing industries were the main source of the increase. Much of Canada’s oil and gas extraction sector is based in Alberta, so capacity utilization in this sector is a good reflection of the pace of economic activity in this province.

Yet there is a distinct downside to the heightened activity: cost pressures for producers. As utilization rises, prices for available machinery, equipment and labour also rise. That puts upward pressure on the break-even point for many projects, particularly in the capital-intensive oilsands.

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Dawn Parent, RE/MAX REAL ESTATE CENTRAL AB.
#1, 5265-45 STREET, Lacombe, Alberta, T4L 2A2
Tel: 403-782-4301 Fax: 403-782-2285
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