Edmonton Real Estate Blog

EDMONTON – The Alberta government will build three schools in Edmonton — in the rapidly growing Summerside, Ambleside and Lewis Farms neighbourhoods — along with expanding the existing Lillian Osborne High School.

“One of the cornerstones of our Building Alberta Plan is education and preparing our kids for their future,” Premier Alison Redford said Monday in a news release. “Last spring, I committed to building 50 schools and modernizing 70 others and that is exactly what we are doing. Before the month is over, all of those projects will be underway.”

The new schools — to address enrolment pressures in growing communities — will create more than 3100 new student spaces. The projects include:

– new kindergarten to Grade 9 school for Summerside, benefiting as many as 750 Edmonton Catholic Separate School District students;

– a new kindergarten to Grade 9 school in Windermere (in Ambleside), benefiting as many as 900 Edmonton Public School District students;

– a new junior high school in Lewis Farms, benefiting as many as 900 Edmonton Public School District students; and,

– a new 600-student space expansion to Lillian Osborne High School in southwest Edmonton.

“Our commitment to build state-of-the-art schools in communities across Alberta is critical to achieving the goals of Inspiring Education,” Education Minister Jeff Johnson said in the release. “We are putting students first by making smart and strategic investments in their education. These new schools will help ensure that every student can reach their full potential.”

Source: EdmontonJournal.com

Some agents think the sky is not the limit when it comes to serving their clients. Those agents defy gravity with remote-controlled drones outfitted with cameras, which deliver stunning aerial photography ordinary marketing materials can’t offer.

Scott Gerami, a Hall of Famer with RE/MAX Professionals Select in Naperville, Ill., is among the early adopters of these small, unmanned aerial vehicles (UAVs), which are commonly referred to as drones.

His drone soars 400 feet above clients’ homes, and its camera captures images of rooflines, aerial views of landscaping, neighboring properties and a bird’s-eye view of nearby landmarks.

“The drone provides amazing video and pictures other agents don’t have,” Gerami says. “Using it shows clients that I’m on top of the latest trends and technology to market their homes better.”

Client response has been “overwhelmingly positive,” Gerami says, but it’s still too early to say whether drones have had a tangible impact on his business.

“Up until this point, I used drone photography as a value-added service on select properties,” he says. “But I plan on promoting it heavily going forward.”

Drones come in all sizes and price ranges – some cost as little as $500 – but Gerami went the DIY route. He has designed and built his own drones.

In fact, Gerami is so excited about the technology that he’s working to set up a live, online video chat in collaboration with Mad Lab Industries, a local tech company that helped him build his drones. Now Gerami wants to partner with the company to teach other professionals how to get the most from these little marvels.

Broker/Owner Mark Cooper is also an avid fan of drones. He just started experimenting with the cutting-edge technology at his aptly named brokerage, RE/MAX Edge in O’Fallon, Mo. And like Gerami, he’s sold.

VIEW FROM THE TOP Mark Cooper’s aerial drone photography is his
newest, and most impressive, marketing tool.

He firmly believes drone photography will become a recruiting tool to attract innovative agents – and new clients.

“The client with the $2 million house to sell will look at my aerials and say, ‘Hey, I want that drone view, too,’ and give his business to me and not the competition,” Cooper says.

Using drones is a time and money commitment, Cooper notes. It can get pricy – Cooper says he’s invested about $2,000 so far – and producing drone videos can take up to eight hours for a single listing.

That’s why Cooper thinks he’ll use the drones to market luxury homes or large properties, which are harder to fully photograph. But he agrees with those who say that this technology and its real estate applications are here to stay.

“There are so many ways drones can be used in our industry,” Cooper says. “Roof inspections, property surveys and even up-to-date street views. If you’re selling a farm or a lot of acreage, you no longer have to trek a mile with a buyer to see the land. You can offer them an overview shot the day before – or maybe even live!”

Source: REMAX.com

EDMONTON- A new mandatory warranty program designed to protect people buying new homes across the province comes into affect this weekend.

The government calls the New Home Buyer Protection Act the strongest consumer home warranty protection plan in Canada.

“This legislation will help protect the single largest purchase that most people make…a home,” said Minister of Municipal Affairs Ken Hughes.

Ninety per cent of homes built in Alberta already have new home warranty, but the new legislation will require all builders to provide more comprehensive home warranty coverage for all new homes and condominiums built in the province.

At minimum, all new homes will have the following warranty protection:

• one year labour and materials – this covers the way the home was built or the materials it was built with, such as flooring and trim;
• two years distribution systems – this covers the labour and materials related to heating, plumbing and electrical systems;
• five years building envelope protection – this covers the exterior shell of the home, including the roof and walls, and includes a requirement for the warranty provider to offer the consumer the option to purchase two additional years of building envelope coverage; and,
• ten years coverage for key structural components, including its frame and foundation.

“Reputation is very important,” said Tally Hutchinson, vice president of the Canadian Home Builders’ Association, Edmonton Region. “And we will continue to build homes with best practice and we think that this initiative is very, very important for the consumer and for the industry.”

However, not everyone is convinced. Homeowner Meaghen Allen took possession of her home over four months ago and says she’s still fighting with her builder over several issues.

“The side of our house stairwells, we didn’t have an exit there. The garage, the electrical to the garage, lighting fixtures. Just the quality of work, the stairs, the paint,” she said. “And just too, they were building properties next door to us.”

Allen says going through warranty hasn’t worked, either.

“My experience with New Home Warranty is that they don’t do anything,” she explained. “I have dealt with New Home Warranty (on) three different houses, and three different houses, nothing out of it.”

However, the province maintains it will hold builders and warranty companies accountable. In order to crack down on negligent builders, fines of up to $500,000 can be handed out. The Superintendent of Insurance will also investigate consumer complaints against warranty providers.

“Our new home buyer protection office has compliance officers who will monitor compliance,” said Ivan Moore, assistant deputy minister, Public Safety Division, Municipal Affairs.

The Act will only apply to homes with a building permit applied for after Saturday, Feb. 1.

The New Home Buyer Protection Act was passed in November 2012, and was originally supposed to come into effect last fall. However, that date was pushed back to Feb. 1, 2014 to give warranty providers more time to prepare, the government said.

For more information on the Act, including access to warranty information, visit the Government of Alberta’s website.

Source: GlobalNews.ca

After 12 years at Apple leading the design of the iPod and iPhone, Tony Fadell told his friends and family he was leaving one of the most valuable companies on the planet to make thermostats. (Could there be anything less glamorous?) Not surprisingly, his move elicited a collective, “Are you insane?”

But yesterday Google announced it was forking over $3.2 billion in cash for Fadell’s company, Nest, which makes a smart device called the Learning Thermostat and a smart smoke detector called Protect. Not such a crazy move after all.

“My initial reaction was ‘wow,’” says Chet Geschickter, an analyst covering energy management at research and advisory company Gartner. “Google would need to sell a lot of thermostats to get that money back, probably too many to validate the price.”

Geschickter believes the move is part of a broader strategy for Google. “They’re probably making a play at what we call the connected home, a ubiquitous networking with low-cost sensor devices, and they’ll start building all different kinds of functionality inside modern domestic environments,” he says. “The fact that they paid $3.2 billion for a company created with a very attractive product that’s getting traction — it’s a very large investment, even for Google. My take as an analyst is, this is part of a bigger strategy for home tech.”

But Google is acquiring so much more than thermostats and smoke detectors that go for $250 and $130, respectively. It’s getting a learning algorithm that’s integrated in Nest products, which interact with homeowners rather than just implementing their commands.“They’re purchasing the customer base and brand name, which Nest has done a good job of popping up very quickly,” Geschickter says. “When you break it down, there are a couple of different key pieces of intellectual property that have legs.”

When a behemoth tech company like Google places its chips on the table, everyone starts to listen, and this could be the big break that the home tech sector has been looking for. “I’m really blown away by this news,” says architect Steven Randel. “I think that Google sees a huge lapse in the technology in this specific area. They’re going to try and move in on it because no one else is doing it. All these different home tech devices, nothing is coordinated together; that’s what Google is trying to go for. You’ll see them begin to integrate all these different devices, and they’ll communicate to one source.”

Home tech writer Mike Elgan points out that Google had actually been working on a smart thermostat of its own and may have abandoned those plans. “The company is interested in home automation and the ‘Internet of things’ because Google’s specialty is better living through algorithms,” he says. “The Nest thermostat, as well as the company’s smoke detectors, are intelligent. They learn and adapt. Eventually all these smart things in the home will be connected to each other and to the people who live there through smart phones and wearable computing devices.”

Fadell and Rogers had set out with their company to make home products that users can control with smart phones, but also that learn on their own. The thermostat, for example, learns homeowners’ living patterns and adjusts accordingly for the just-right temperature — allowing the homeowners to save on monthly energy bills.

Canadian home prices ticked back up to a record high in December, thanks entirely to Edmonton, Vancouver and Toronto, according to the Teranet-National Bank house price index.

The 0.1-per-cent rise in home prices in December reversed a 0.1-per-cent decline in November, and returned the index to its all-time high.

But the majority of the 11 cities that the index tracks have seen prices edge down in recent months. Winnipeg, Calgary, Ottawa-Gatineau, Quebec City, Montreal, Hamilton, Halifax and Vancouver each saw prices decrease from November to December.

December was the sixth month in a row that Montreal failed to see a price increase, and the fifth month in a row in Quebec City, National Bank of Canada economist Marc Pinsonneault said in a research note. Ottawa-Gatineau has seen prices fall for four months in a row and Victoria for three, he added.

But Vancouver, the city that saw the steepest market correction in the past two years, saw its prices rebound to a new high. Toronto’s prices rose 0.4 per cent from November, the first time they’ve risen in four months, and are now almost back up to the peak that they reached last August. Edmonton posted its first price increase in five months, up 0.6 per cent.

All told, national home prices were 3.8 per cent higher in December than they had been a year earlier. That’s an acceleration from the 3.4 per cent year-over-year increase in November, and is stronger than the 3.1 per cent increase in prices during 2012.

But Mr. Pinsonneault notes that the improvement from 2012 comes solely from Calgary, Vancouver and Toronto. Excluding those three cities, last year’s price increase would have been 1.2 per cent.

Given that higher mortgage rates are eroding housing affordability, Mr. Pinsonneault is predicting that house price increases will barely cover CPI inflation during 2014, about 1.5 per cent.

Calgary has seen its prices rise 6.5 per cent in the past year according to this index, Toronto 4.9 per cent, Vancouver 5.5 per cent and Winnipeg 3.4 per cent. The only city that has seen a price decrease over the past year is Victoria, where prices have dropped by four per cent. But a number of cities, namely Quebec, Ottawa, Montreal and Halifax, saw prices tick up just a bit.

Many economists say they are surprised by how well Canadian home prices have held up in the wake of the market downturn that impacted much of the country from the summer of 2012 until this past spring. Prices tend to lag sales, and economists expected the slump to translate into more downwards pressure on prices.

“Prices have been much stronger than we anticipated them to be,” Toronto-Dominion Bank real estate economist Diana Petramala said earlier this month.

The Canadian Real Estate Association, which represents the bulk of real estate agents in Canada, will release December’s average prices as well as its latest home price index numbers Wednesday (averages tend to be skewed by changes in the size or types or locations of homes that are selling).

But the Calgary Real Estate Board recently said that the benchmark price of a single family home in the Calgary area has risen to $472,200, up 8.6 per cent from December of 2012.

The benchmark in Vancouver is $603,400, up 2.1 per cent from a year earlier.

The average price of homes that sold over the Multiple Listing Service in the Toronto area during December was $520,398, up by 8.9 per cent from the average selling price in December, 2012. And the average selling price in Toronto for all of 2013 was $523,036, up 5.2 per cent from the average in 2012.

Source: www.TheGlobeAndMail.com

Source: Dominion Lending Centres Newsletter

Although no one expects oil prices to soar — both Marion and Hirsch say the price of West Texas Intermediate, the benchmark U.S. grade of light crude, will likely trade between a low of about $85 US and a high of $100 US a barrel in 2014 — the weaker loonie is expected to boost cash flows and keep drilling programs and oilsands projects on track.

At the same time, manufacturing — a key sector in the Edmonton region’s economy — is expected to pick up, particularly if one or more of the proposed new oil pipelines finally gain some traction. But if they don’t, Rose warns that the current upbeat outlook for the provincial economy could change quickly.

“If we don’t get some good news on one or more of the four major pipeline proposals that are out there, I think you’ll see a very soft and squishy 2015 for sure, and it would raise question marks in terms of our growth profile as a province over the next five to six years.”

Although Canadians will go to the polls in 2015 — giving the Harper government a strong incentive to achieve some progress on its energy infrastructure agenda — Rose is skeptical that the Obama government will okay the proposed Keystone XL pipeline to the U.S. Gulf Coast.

“The really bad news is that we’ve got mid-term elections in the U.S. next year, so my concern is that politicians in the U.S. are going to punt decisions on Keystone XL beyond the elections, because they may perceive it as a no-win situation from an electoral point of view. If so, that would be unfortunate to say the least.”

Source: EdmontonJournal.com

Rising mortgage rates are fuelling home sales. They also appear to be curbing price growth as buyers drive tougher bargains.

The number of existing homes that changed hands across the country last month rose 18.2 per cent from a year earlier, the Canadian Real Estate Association said Tuesday. September’s sales were slightly above the long-term average for that month, an indication that the market has fully recovered from the steep slump after Finance Minister Jim Flaherty tightened the mortgage insurance rules in the summer of 2012.

While sales were up just 0.8 per cent from August, the rise topped some economists’ expectations and marked the seventh consecutive month-to-month gain.

But many experts claim that the increase in mortgage rates that has occurred since the spring, and the prospect of higher rates down the road, is providing a sales boost that will prove to be temporary.

Mortgage rates are up about three-quarters of a percentage point since May, with five-year fixed rates having risen to 3.39 per cent from 2.64 per cent, according to Alyssa Richard, chief executive of RateHub.ca.

With buyers facing higher rates, the market could lose steam in the months ahead.

“We expect home resales to stabilize near the current levels, although some modest pullback may occur later this year or early next as payback for sales that may have been advanced during the rush to lock-in lower rates,” Royal Bank economist Robert Hogue said in a research note.

Greg Twinney, a senior executive at the e-book company Kobo, says mortgage rates played a large factor in his role to move his family from downtown Toronto to Caledon, north of Mississauga, this fall. He had been planning to move there some time in the next five years, but the combination of finding a property he liked and a lack of clarity over how much rates will rise spurred him to buy a house there last month.

“Given where interest rates are, you’re able to get in to a home now and lock in interest rates and know what you’re paying for the next five years and it’s affordable,” he said.

The banking regulator, the Office of the Superintendent of Financial Institutions, has long been considering tightening the country’s mortgage underwriting rules, and could still take action.

Canadian Imperial Bank of Commerce economist Benjamin Tal has said recently that he suspects the housing market is currently too strong for the government’s liking. But if the current momentum in sales does prove temporary, that could ease any fears that Mr. Flaherty might have.

Jim Murphy, the head of the Canadian Association of Accredited Mortgage Professionals, met with Mr. Flaherty last month, partly in an effort to present the association’s case that the market is in balance and no further tightening is required. “I think he’s comfortable with where the market’s at,” Mr. Murphy said Tuesday.

Much of the concern that policy makers have had about the housing market in recent years has stemmed from rising consumer debt levels and home prices.

While the average price of homes that changed hands over the Multiple Listing Service last month was up 8.8 per cent from a year earlier, to $385,906, that’s in large part because pricey cities, such as Toronto and Vancouver, were in the midst of steep sales declines a year ago.

The Teranet-National Bank home price index for September, released Tuesday, hadn’t budged from August. The index normally picks up 0.2 per cent from August to September as buyers return from summer vacations.

“Price behaviour seems to be at odds with the recent pickup in resale activity,” National Bank economist Marc Pinsonneault wrote in a research note. “It looks that households are willing to buy, but they are now bargaining harder on prices to compensate for higher mortgage rates.”

Toronto-Dominion Bank economist Diana Petramala pointed out that a rising stock of unsold condos is also weighing on price growth. “Prices were down in Montreal and Ottawa where a growing overhang of condos on the market is keeping prices low.”

Meanwhile, consumers who are wondering where mortgage rates will go next should look to Washington, says TD chief economist Craig Alexander.

Five-year fixed mortgage rates tend to follow the yields on five-year government of Canada bonds, because those influence banks’ funding costs. Canadian bond yields tend to mirror those in the U.S. because the market views the securities as alternatives to one another. Mortgage rates rose over the summer as bond yields rose, largely because of expectations that the U.S. Federal Reserve would soon begin tapering its quantitative easing program.

That hasn’t happened, and bond yields have edged down a bit recently as a result. But banks tend to change their mortgage rates only when they think yield changes will be relatively long-lasting, Mr. Alexander said.

“Over the entire course of next year, I expect the five-year yield to go from 2.05 to 2.55 per cent, so I think the balance of risks are that, in 2014, fixed mortgage rates will creep up a little bit,” he said.

Source: http://www.theglobeandmail.com