The Canadian Real Estate Pages

Archive for July, 2010

People expecting a quiet, enjoyable Father’s Day in the Lago Lindo neighbourhood witnessed an unfathomable tragedy that resulted in the loss of four lives.  A huge explosion completely demolished one house, partially destroyed three residences and caused damage to many more.  

The blast occurred a bit after 1 p.m. June 20, and emergency workers rushed to the scene.  It soon became evident that the incident was of a suspicious nature, and homicide crews began their investigation June 21.  Although the police are not commenting on possible causes, neighbours have contended that a deliberately rigged explosive device or a residential drug laboratory may have triggered the event.  

Among the four people that were killed are Craig Huber, 30, and Bradley Winter, 26.  The men were in a house to the immediate north of the detonated home, which, according to property records, is owned by Dwayne Poirier and Jeanne Heard.  Currently no more than a blasted foundation, the site of the former house is referred to by police as “ground zero.”  

The identities of the other two other people killed in the explosion have not yet been released.  Police originally characterized the individuals as two males, but on June 21, they advised that one of the victims was a woman.  

Amy Fuechtmann, the fiancée of Winter, as well as her little boy, were also in the home in which Winter and Huber were killed.  Mother and son were rescued by neighbours, who said they were amazed to find survivors.  Edmonton Mayor Stephen Mandel praised the neighbours, admiring their bravery under highly dangerous circumstances.  

Per additional property information, two years’ worth of property taxes were owed on the residences owned by Heard and Poirier as well as Winter.  Both of the homes had been purchased at the top of the Edmonton real estate boom, and both had decreased in value.  Since Winter bought his house in 2007, the home’s value dropped by $84,000.  The home owned by Heard and Poirier experienced a $26,500 loss in value since its purchase in 2008.

Gerard Hagan – Edmonton Homes For Sale

Signaling confidence in the stabilization of the country’s economy, the central bank of Canada increased borrowing prices by one quarter of a percentage point June 20.  The slight rise in the interest rate, now at 0.75 percent, marks the second in two consecutive months.

Despite this inherent expression of faith in financial recovery, the outlook is a bit cloudier than expected:  The bank reduced projections of growth for the remainder of 2010 from 3.7 percent to 3.5 percent.   

Per a press release issued by the central bank, the revised projections reflect slightly decreased consumption in the nation.  The projected 2011 gross domestic product is 2.9 percent versus the previously anticipated 3.1 percent.  A complete recovery is predicted by end of next year, instead of in the spring.

Major Canadian economists believe another rate hike will occur in the fall, but are withholding additional increases pending economic conditions.  They concur that, despite the small rises in interest rates, they are still historically low.

The rate increase and the probability of additional hikes may be probing homebuyers to make decisions.  A young couple, Jesse Hogg and Brenna Jones, are pre-approved for a $350,000 mortgage and are able to make an $18,000 down payment.  The couple is looking for a fixer-upper home.  Jones and Hogg are approved for a variable-rate mortgage with the option of converting to a fixed-rate plan if rates continue to rise.  

Canada Mortgage and Housing Corporation senior market analyst Richard Cho advised that people with variable-rate mortgages may or may not be negatively impacted by creeping interest rates, depending upon their amount of disposable income.  He noted that an increase in rates would moderate or negatively affect buying ability.

Jason Luke – Real Estate In New Westminster

Rumours and speculation continue to surround Daryl Katz and his proposed downtown arena.

Katz, billionaire owner of the Oilers and CEO of The Katz Group, has proposed a downtown arena in order to improve the area and give the Oilers a new home. He offered to front $100 million but needs the city to give $400 million to finance the stadium.

Originally, councillors thought Katz’s money was to go to the stadium but now are unclear as to whether the money will go to the stadium or the surrounding land owned by Katz.

Recent rumours have leaked saying Katz is considering relocating the Oilers to Hamilton, Ontario. The Hamilton Spectator reported in mid-July that the Oilers were negotiating with Hamilton’s Copps Coliseum in a four-year agreement to its NHL rights.

According to The Spectator, the Oilers have an understanding with Hamilton, believing they could find a team to use Copps Coliseum. If the team fail, they will end up paying Hamilton $1 million.

The Katz Group’s Vice President of Sports and Entertainment, Bob Black, confirmed the understanding and said while the timing may seem peculiar, he believed a deal securing the life of the Oilers in Edmonton long-term would be found.

Alberta’s Director of Canadian Taxpayers Federation, Scott Hennig, suspects Katz is trying to put pressure on Edmonton councillors by allowing the rumours to circulate.

Katz has yet to submit a presentation or proposal to Edmonton for the arena. A meeting between Katz and city council is scheduled for late July.

Peter Estephan – Edmonton Real Estate Market

Despite Calgary’s increase in residential MLS home prices and sales, the city still trails national housing market averages. In April, 52,042 MLS sales occurred nationally, a 20.3 per cent jump over April 2009. Average property prices also jumped, hitting an average of $344,968, 12.2 per cent higher than April 2009.

According to the Canadian Real Estate Association (CREA), 2,382 April MLS sales occurred in Calgary, an increase of 7.4 per cent over last year, and the average price was $395,847, an increase of 6.4 per cent over last year.

MLS data reaching May 16 showed only 695 single-family home sales in Calgary, averaging $485,683. In May 2009, 1,584 single-family homes sold on average for $437,427. In April 2010, 1,352 homes sold at an average of $460,378.

MLS month-to-date data for condo sales showed 268 sales occurred for an average price of $309,633. In May 2009, 653 sales occurred for an average of $275, 212. In April 2010, 639 condos sold on average for $289,588.

Overall, Calgary’s new listings jumped 43.8 per cent for a total of 5,416.

Provincially, CREA said that April sales increased 5.9 per cent to 5,544 condos selling on average for $344,102, an increase of 7.7 per cent over last year.

Seasonally adjusted home sales across Canada dropped 2.6 per cent from April 2010, and currently sits 6.8 per cent below December 2009’s peak.

Economists and strategists both predict that the market will continue to cool and eventually moderate as home and mortgage prices rise.

Dan Peters – Calgary Real Estate Services

Sturgeon County has had burning bylaws in effect for seven years.  The problem is that they have been difficult to enforce. Billing the offenders for the visit from fire crews that respond to illegal burns is also not proving effective. Sturgeon County Council is working on amending the bylaws to make them tougher.

Bylaw 1224/10 would add a series of fines to the original law; based on how many times the bylaws were violated by an offender and other factors.  Tickets would start at $500 and go all the way to $3000.  By issuing a ticket, the county would be able to enforce collection of the fines.  Tickets also seem to make people think that the county means business.

The $500 fine would be issued for a first offence for property owners burning without a valid permit. Second offence would be fined $1000 and a third $2000.  Higher amounts are reserved for those who choose to ignore the law entirely, virtually double of the burning without permit fines.

The new bylaw was passed through the first and second readings during the council meeting on July 13th.  It still must pass a third reading, which council decided to delay to make sure the law was fair and that the public would have sufficient notice of the change.

Rich Mundle – Real Estate In Sherwood Park

Two year old Maddox Flynn underwent his second surgery for a rare lymphatic condition this past Monday and was doing so well he was released on Tuesday.  The Alberta family is quite a ways from home though.  The surgery took place at the St. Luke’s-Roosevelt Hospital Center in New York, in the United States.

The condition had caused tumours to grow on the left side of his face.  In May a tumour was removed from above his left eye.  This last surgery removed a larger growth below the eye that was keeping him from learning to talk.  The condition is called lymphatic cystic hygroma and is so rare they needed to travel to the Big Apple to find specialists qualified to treat Maddox.

It has been an expensive trip. The surgeries cost in excess of $100,000.  There are travel and lodging expenses on top of that. Mike Flynn and Nicole Champagne, the parents, have been with Maddox through the entire ordeal.  The family plans to stay until July 27th this time around and return to New York in October for another procedure.

Donations have come in from around the world to the Facebook page dedicated to Maddox’s medical ordeal. They are helping the family deal with the costly travel and treatment. Maddox is doing well, and a grateful family knows that down deep, that’s all that matters.

Nigel McLean – Edmonton Homes For Sale

BC Hydro was forced to buy over 100 homes in the Tsawwassen area just south of Vancouver due to a dispute with the neighbourhood about a power lines project.  They spent roughly $60 million to buy 104 homes in 2009.

Just recently these homes went on the market and almost 50 have been resold.  A discount of $70,000 or more was offered to potential buyers. To the delight of Susan Danard of BC Hydro, sales are better than anticipated despite the soft real estate market.

The thinking is that most of the $60 million will be recovered once all sales are finalized. It is possible that BC Hydro customers may see a rate increase if that is not the case. An application for rate increase has already been sought just in case this occurs.

No one is absolutely sure that the market will hurt the remaining sales.  Tsur Sommerville, a real estate expert, thinks the softening market will do just that. BC Hydro does have the discount in their favour, as well as the fact that a good percentage of homes are now occupied.  It’s a lot more difficult to sell property in an empty neighbourhood.

Neda Nozari – Vancouver Condos

Councillor Glen Lawrence’s heritage tree retention proposal from 2008 was sent back for revision.
The policy was brought in front of Strathcona County council members on Tuesday, June 8 by Peter Alexander and Locke Girvan from Engineering and Environmental Planning.

The policy would prevent the unauthorized removal of trees, tree gardens, groves, clumps, shelterbelts, arboretums and botanical or ecological interest sites due to age, size, special interest, shape, location or history.

Many council members supported the idea but said it needed clearer qualifications and further revisions. Mayor Cathy Olesen said the policy should be amended if that action is necessary.

Councillor Peter Wlodarczak said he liked the idea but wanted to revisit the clause stating a qualified arborist would determine the removal penalty. Councillor Jacquie Fenske also liked the idea of saving trees, but pointed out it will change how business runs in the municipalities.

Councillor Roxanne Carr said she wanted more public feedback as some are concerned with how far the policy is being taken. She also shared that Strathcona County is perceived to be a tree-hugging municipality. Councillor Linda Osinchuk expressed her concerns about the care of old trees, but Chief Commissioner Robyn Singleton said that citizen safety would be a factor when preserving trees.

Girvan said the decision of whether to dedicate a tree or other greenery would be up to the land owner, and an arbourist would decide what trees qualify.

The policy has not gone out to developers or residents for consultation.

Jodie Drew – Sherwood Park Real Estate

According to a report released by TD Bank Financial Group, Alberta’s average sales price for a home is expected to rise both in 2010 and 2011. But for many Calgarians, this real estate trend is no longer a worry for them.

Many people struggle to break into the real estate market with its continually rising mortgage and interest rates, creating a gap between income and affordability. Attainable Homes is looking to close that gap.

The program was created by the City of Calgary and is run by a non-profit organization and aims to assist essential labourers such as construction workers, school teachers, social works and retail clerks, buy a home.

Households must earn 80 to 120 per cent of the area’s median income, currently between $53,790 and $80,400, and pre-qualify for a mortgage in order to be eligible for the program.

Attainable Homes aims to have 1,000 multi-family homes for families, couples or individuals built across Calgary by 2011 with occupancy occurring in 2012.

The program is able to lower the cost of homes by combining land and private sector, making the equity of the land part of the owner’s down payment. The land will be returned to the program once the owner sells—through a shared-equity model at market price. Attainable Homes will reinvest money from the sale back into the program.

Home designing and building will begin once a partnership is solidified within the building community.

Don Blocka – Calgary Luxury Homes

The future of City Centre might be “up in the air” again, as Edmonton is now dealing with its third plebiscite regarding aviation in 18 years.  A group headed by businessman Charles Allard is lobbying to enforce an updated vote on the next steps for City Centre Airport.

Currently, the 217-hectare airport site is slated to become an eco-friendly development offering both living and commercial space for approximately 30,000 residents.

Allard’s group, known as Envision Edmonton, plans to spend some $500,000 on getting petitions signed.  The goal:  Instate a bylaw that would maintain City Centre as a general-aviation facility and keep its infrastructure.  Its two current runways would also be retained.

Allard said that up to 100 people are volunteering to work on the “Demand the Vote” project.  He would like to attract around 1,000 helpers.  He said that keeping City Centre open would help to keep businesses based in Edmonton.

TV ads are scheduled to start airing during the week of June 20.  The workers are allotted 60 days to obtain signatures from some 78,000 people who are eligible to vote.  This number accounts for ten percent of Edmonton’s population.  Allard said that volunteers are going door-to-door, to office complexes, nursing homes and churches.

If Demand the Vote is successful, the question on the bylaw would be a part of the civic ballot in October.

Pledges are beginning to pour in from donors.  Allard said that although most of the contributions range from $5,000 to $15,000, one pledge for at least $50,000 has arrived.  At this point, Allard is not divulging donor names, citing privacy concerns.

Ryan Philipenko – Real Estate Services Edmonton