A national report predicts average house prices in Calgary will increase by 3.6 per cent this year.

The Royal LePage House Price Survey and Market Survey Forecast, released Thursday, said a vibrant local economy and low interest rates will drive demand for homes in the city in 2012.

It expects Calgary to post some of the highest year-over-year price increases in Canada.

In the fourth quarter of 2011, detached bungalows in Calgary posted the largest year-over-year price increases, rising 6.2 per cent to $416,622. Prices for standard two-storey homes rose 2.2 per cent year-over-year to $414,778, while prices for standard condominiums were flat, rising slightly 0.1 per cent year-over-year to $248,567.

“The modest year-over-year gains we saw in the fourth quarter conceal a strengthening market in Calgary,” said Ted Zaharko, broker and owner of Royal LePage Foothills, in a statement. “A vibrant local economy combined with continued low interest rates has Calgary poised to be one of Canada’s strongest real estate markets.”

The modest year-over-year gains we saw in the fourth quarter conceal a strengthening market in CalgaryHe said low interest rates combined with a lack of homes for sale helped create upward pricing pressure and led to frequent multiple offer situations as the year drew to a close.

Zaharko said first-time buyers looking to take advantage of low rates were an active group in the fourth quarter of 2011. Retirees looking to downsize were also an active group and drove demand for the city’s detached bungalows.

According to Royal LePage, by the end of 2012, average house prices in Calgary are expected to increase 3.6 per cent. Market activity is forecast to be the strongest in Canada with 2012 unit sales expected to rise 10.6 per cent higher than they were in 2011. At the national level, in the fourth quarter of 2011, standard two-storey homes rose 4.2 per cent year-over-year to $375,427, while detached bungalows increased 6.1 per cent to $344,392. Average prices for standard condominiums increased 3.6 per cent to $234,680.

Royal LePage expects average price growth to continue through 2012 and predicts national average prices to increase by 2.8 per cent by the end of the year.

The year-over-year growth rate for Calgary MLS residential sales in November grew at a pace three times more than the national average, according to data released Thursday by the Canadian Real Estate Association.

The association said there were 1,656 MLS sales in Calgary during the month, a hike of 16.0 per cent from November 2010.

Nationally, there were 34,534 sales representing an increase of 5.0 per cent.

In Calgary, the average MLS sale price in November was $398,722 which was basically the same as a year ago while the Canadian average price grew by 4.6 per cent to $360,396.

New listings in Calgary dropped by 5.3 per cent to 2,356 but they grew by 2.7 per cent across the country to 53, 515.

“The Canadian housing market is proving resilient in the face of ongoing global economic and financial uncertainty, to the benefit of Canadian economic growth,” said Gary Morse, CREA’s president, in a statement.

Gary MorseThe Canadian housing market is proving resilient in the face of ongoing global economic and financial uncertainty…November sales across the country were seven per cent above the 10-year average, reaching the fourth highest level on record for the month.

“Toward the end of every year, there’s a natural inclination to compare how momentum for national sales activity and average price compare to the year before,” said Gregory Klump, CREA’s chief economist, in a statement. “National sales activity picked up late last year, and November’s results suggest that a similar trend may be playing out again this year. By contrast, national average price also picked up toward the end of last year, whereas this year it has held steady after having peaked in the spring.

“With interest rates expected to remain low for longer, the housing sector will no doubt be closely watched for signs of excess. That said, current trends for resale housing and new home construction suggest that tightened mortgage regulations are working as intended and fostering economic stability in Canada.”

In Alberta, sales of 3,761 units were up 3.8 per cent from last year and the average price of $356,535 increased by 2.7 per cent. New listings of 5,820 were down six per cent.

An RBC Housing Snapshot poll said 33 per cent of Canadians think the real estate market is balanced, down seven percentage points in the fourth quarter from the first quarter, indicating opinion has begun to shift slightly to a seller’s market.

Also, 26 per cent define the current real estate market as a seller’s market, up six percentage points since the start of the year.

The RBC poll showed most Canadians describe the real estate market as a buyer’s market (41 per cent), where buyers have the advantage. That sentiment is fairly stable from the first quarter (40 per cent).

Albertans believe it is a buyer’s market (65 per cent), much more than any other region and 14 percentage points above the national average They also firmly believe it is not a seller’s market (six per cent).

The ‘sizzle’ will be taken out of the Canadian housing market next year, according to the Housing Forecast report from the Altus Group.

Actually, using ‘sizzle’ in the same sentence as ‘Canadian housing market’ is misleading in that the hot areas are only in certain parts of the country and certainly not in Alberta.

“You’re right about Calgary and Edmonton, which have been slower than elsewhere in the country,” says Peter Norman, chief economist at Altus Group.

“They are at a different point in the cycle (than other cities) but stand out in terms of where they are going.” And where they are going is up, unlike the rest of the country, says Norman in the report.

“Altus Group looked at regional trends across the country for the coming year,” he says. “Alberta has seen job conditions and interprovincial migration rise sharply this year (at the expense of Ontario and British Columbia,) positively impacting housing demand next year.

Peter NormanThey are at a different point in the cycle (than other cities) but stand out in terms of where they are going.” And where they are going is up, unlike the rest of the country…“However, other areas of the country will experience lower starts, including Atlantic Canada, where migration will continue to be impacted by the weak economy, which will hamper new housing demand.”

Part of the coming slowdown across the country can be attributed to the three rounds of tightening of mortgage qualification regulations by the federal government, which brought thousands of buyers forward to get into homeownership before the rules came into effect, but a larger issue is in play, says Norman.

“Most of the rules were aimed at (younger) first-time buyers, but to some extent first-timers never came back after the recession, anyway,” he says. “It will likely be a long time until we see them come back.

“Certainly the market is coping without first-time buyers, but it’s one of our biggest challenges.”

The importance of younger first-timers cannot be understated: Homeowners can’t move up unless there are buyers for their homes and traditionally most of those buyers come from the first-timer pool.

As noted by Norman, there is a potential first-time buyer pool, not necessarily in younger demographics, in Alberta: New arrivals.

The Altus report, using figures from Statistics Canada, shows the level of net interprovincial migration to the province in the period of January 2011 to June 2011 was higher than the entire year of 2010.

Figures from Canada Mortgage and Housing Corp. indicate Calgary has received a good share of the newcomers, who traditionally rent before buying a home.

The apartment vacancy rate for October 2011 is forecast to be 3.4%, down from 5.3% two years ago, and is forecast to fall again to 2.9% by October 2012.

When Alberta last enjoyed large net migration numbers, the lag between renting and buying was about nine months.

If and when the current vacancy rates will translate into increased home sales is the great unknown — what is known is Alberta is heading in the right direction.

Single-family and condominium MLS sales increased in October compared with a year ago, according to the Calgary Real Estate Board.

The board said Tuesday that single-family sales of 988 for the month were up by 11.39 per cent from October 2010 while condo transactions jumped by 19.87 per cent to 368 units.

The average sale price for a single-family home was up by 2.35 per cent year-over-year to $455,399 while the condo average dropped by 1.70 per cent to $282,903.

“A boost in full-time jobs throughout the year is gradually translating into improved sales in the real estate sector,” said Sano Stante, CREB president, in a statement. “Consumers are taking advantage of price stability and a healthy variety of selection. While these gains are moderate, we are set to outpace 2010 sales.”

Richard ChoFull-time employment growth has turned around this year, an area that had struggled in the past two years…Year-to-date sales in the single-family sector are 11,503, a 9.89 per cent increase over last year.

Condo year-to-date sales of 4,681 are up 2.92 per cent from last year.

“Consumers are feeling more confident about the local real estate market,” said Stante. “Overall, the resale housing market continues to show signs of improvement and, with no near term change in interest rates, we can expect the market will continue to see moderate and stable growth throughout the rest of the year.”

Richard Cho, senior market analyst in Calgary for Canada Mortgage and Housing Corp., said resale activity in the city is benefiting from improved labour market conditions, historically low mortgage rates and positive migration flows.

“Full-time employment growth has turned around this year, an area that had struggled in the past two years,” he said. “Low mortgage rates have also benefited many prospective buyers and will continue to remain favourable as rates are not anticipated to increase in the short term. Despite some of the financial uncertainty occurring in other countries, demand for housing in Calgary remains steady.”

On September 28, Calgary Economic Development and TD Bank Group presented the annual Economic Outlook event featuring Craig Alexander, Senior Vice President and Chief Economist for TD Bank Group and Mario Lefebvre, Director of the Centre for Municipal Studies at the Conference Board of Canada.

Calgarians were the first in Canada to hear Craig Alexander present TD Economics’ 2012 Alberta forecast – Risk & Volatility: Economic and Financial Perspectives for 2012, and Mario Lefebvre presented the Conference Board of Canada’s 2012 Economic Outlook for Calgary.

View Video Presentation

During the run-up to every U.S. presidential election, countless Americans threaten to move to Canada if their preferred candidate does not emerge victorious. Of course, few follow through with a move north. Maybe it is time to reconsider.

Canada ranks No. 1 in our annual look at the Best Countries for Business. While the U.S. is paralyzed by fears of a double-dip recession and Europe struggles with sovereign debt issues, Canada’s economy has held up better than most. The $1.6 trillion economy is the ninth biggest in the world and grew 3.1% last year. It is expected to expand 2.4% in 2011, according to the Royal Bank of Canada.

Canada skirted the banking meltdown that plagued the U.S. and Europe. Banks like Royal Bank of Canada, Bank of Nova Scotia and Bank of Montreal avoided bailouts and were profitable during the financial crises that started in 2007. Canadian banks emerged from the tumult among the strongest in the world thanks to their conservative lending practices.

Canada is the only country that ranks in the top 20 in 10 metrics that we considered to determine the Best Countries for Business (we factored in 11 overall). It ranks in the top five for both investor protection as well as lack of red tape, which measures how easy it is to start a business.

Canada #1Canadian banks emerged from the tumult among the strongest in the world thanks to their conservative lending practices.
Canada moves up from No. 4 in last year’s ranking thanks to its improved tax standing. It ranks ninth overall for tax burden compared to No. 23 in 2010. Credit a reformed tax structure with a Harmonized Sales Tax introduced in Ontario and British Columbia in 2010. The goal is to make Canadian businesses more competitive. Canada’s tax status also improved thanks to reduced corporate and employee tax rates.

Canada leans on the U.S. economy heavily: it’s the biggest oil supplier to Uncle Sam and three-quarters of its exports end up in the U.S. each year. Yet while U.S. unemployment has stayed above 9%, it’s only 7.3% in Canada compared to the 25-year average of 8.5%. The eurozone unemployment rate is 10%.

We determined the Best Countries for Business by looking at 11 different factors for 134 countries. We considered property rights, innovation, taxes, technology, corruption, freedom (personal, trade and monetary), red tape, investor protection and stock market performance.

Forbes leaned on research and published reports from the Central Intelligence Agency, Freedom House, Heritage Foundation, Property Rights Alliance, Transparency International, the World Bank and World Economic Forum to compile the rankings.

Canada in Top 5Canada is the only country that ranks in the top 20 in 10 metrics that we considered to determine the Best Countries for Business (we factored in 11 overall). It ranks in the top five for both investor protection as well as lack of red tape, which measures how easy it is to start a business.
Denmark dropped from the top spot in 2010 to No. 5 this year as its relative monetary freedom declined as measured by the Heritage Foundation. Denmark’s stock market also fell 14%, which was the worst performance of any of our top 10 countries. Four other European countries in last year’s top 20 also dropped in the rankings, with Finland sliding to No. 13, the Netherlands to No. 15 Netherlands, Germany to No. 21 and Iceland to No. 23.

The U.S. ranked No. 10, down from No. 9 in 2010. The world’s largest economy at $14.7 trillion continues to be one of the most innovative, ranking sixth in patents per capita among all countries (No.7 overall Sweden ranks tops for innovation).

What hurts the U.S. is its heavy tax burden. This year it surpassed Japan to have the highest corporate tax rate among developed countries. The U.S. also gets dinged for a poor showing on monetary freedom as measured by the Heritage Foundation. Heritage gauges price stability and price controls and the U.S. ranks No. 50 out of 134 countries.

Bringing up the rear are three countries where the economies are smaller than $10 billion. No. 132 Burundi, No. 133 Zimbabwe and No. 134 Chad all fare poorly when it comes to trade and monetary freedom as well as innovation and technology. Chad has the highest GDP per capita of the three at $1,600, but scores last among all countries on both corruption and red tape.

Want to pay down your mortgage faster?

When you pay down your mortgage faster, you can reduce your total interest costs by thousands of dollars and be mortgage-free years before you had thought possible. At The Mortgage Group, our Associates are able to advise you of the options available that will enable you to achieve this goal.

Prepayment Privileges

We all want to be mortgage-free faster. The Mortgage Group has ways to help you. With flexible prepayment options, you put extra cash towards your mortgage principal without incurring charges. This can save you thousands of dollars on your mortgage. Here’s how it works:

Increase your mortgage payments (principal and interest).

You can increase the amount of your mortgage payment once each calendar year by:

• 10% for a Low-Rate Fixed Closed Mortgage or
• 20% for any other type of closed mortgage

Make a lump-sum payment against your mortgage principal

In addition to increasing your mortgage payments, you can make a lump-sum prepayment (in $100 increments) each year without added charge (Some conditions apply). The maximum prepayment per calendar year is:

• 10% of the original mortgage amount for a Low-Rate Fixed Closed Mortgage; or
• 20% of the original mortgage amount for any other kind of closed mortgage

Pay more frequently

By switching from monthly mortgage payments to an accelerated weekly or bi-weekly schedule, you can become mortgage-free sooner and save thousands.

Example: $250,000 mortgage @ 6% APR on a 5-year fixed term with different payment frequencies for a 25-year amortization*.

* The Annual Percentage Rate (APR) is for a mortgage of $250,000 and a 25-year amortization. APR assumes no fee(s) will apply. If an appraisal is required, the appraisal fee would increase the APR. The interest for a fixed rate mortgage is calculated half yearly, not in advance. The rate shown is an example only and is not necessarily applicable to an actual mortgage. Assume same interest rate for entire amortization period. These results are based on the above example as well as a number of assumptions. While care is taken in the preparation of the illustration, no warranty can be made as to its accuracy or applicability for any particular case.

Increase your regular mortgage payment and shorten your amortization

You can choose to increase the amount of your regular mortgage payment (principal and interest) by up to 20% (10% if you have a Low-Rate Fixed Closed Mortgage) without added charge. You can do this once in every calendar year. Paying more each month shortens your amortization and can significantly reduce your interest costs over time.

Example: $250,000 mortgage at 6% interest on a fixed term with monthly payments1

1Per annum, calculated half yearly, not in advance. The rate shown is an example only and is not necessarily applicable to an actual mortgage.

2Assume same interest rate for entire amortization period.

Protect your health and prevent further damage to your home by following this step-by-step guide to restoring your home after a flood.

After a flood, it’s important to restore your home to good order as soon as possible to protect your health and prevent further damage to your house and belongings. Whether you do the work yourself or hire a contractor, this handy checklist will help you organize the clean up.

Immediate action is important. Your house and furnishings are less likely to grow mold if they are dried within 48 hours.

Before You Begin

• Put your own safety first. Avoid electrical shock. Wear rubber boots. Keep extension cords out of the water. Shut the power off to the flooded area at the breaker box. Ask your electrical utility for help if needed.
• Record details of damage, with photos or video if possible. Contact your insurance agent immediately and register with your municipality—your municipality may have resources you need, such as future financial assistance.
• Set up a step-by-step action plan to:
  • remove all water, mud and other debris
  • dispose of contaminated household goods.
  • rinse away contamination inside the home.
  • remove the rinse water.
  • clean and dry out your house and salvageable possessions.
• Be prepared to make difficult decisions about what to keep and what to throw out. Household items that have been contaminated by sewage, or that have been wet for a long time, will have to be bagged, tagged and discarded according to local regulations.
• Assemble equipment and supplies:
• gloves, masks (N95 respirators) and other protective gear
• pails, mops, squeegees and plastic garbage bags.
• unscented detergent.
• large containers for wet bedding and clothing, and lines to hang them to dry.
• you may also need to rent extension cords, submersible pumps, wet/dry shop vacuums, and dehumidifiers or heaters.
• Store valuable papers that have been damaged in a freezer until you have time to work on them.

First Steps

• Remove standing water with pumps or pails, then with a wet/dry shop vacuum.
• Remove all soaked and dirty materials and debris, including wet insulation and drywall, residual mud and soil, furniture, appliances, clothing and bedding.
• Hose down any dirt sticking to walls and furnishings, then rinse several times, removing the remaining water with a wet/dry shop vacuum. Rinse, then clean all floors as quickly as possible. Flooring that has been deeply penetrated by flood water or sewage should be discarded.
• Work from the top down. Break out all ceilings and walls that have been soaked or that have absorbed water. Remove materials at least 500 mm (20 in.) above the high-water line. Removing only the lower part of the wall applies if action is taken immediately after the flood or wetting event. Gypsum board walls that have been exposed to high humidity or standing water for a prolonged period of time should be removed in their entirety and discarded. Ceiling tiles and panelling should be treated like drywall.
• Wash and wipe/scrub down all affected or flooded surfaces with unscented detergent and water. Rinse. Repeat the process as needed. Concrete surfaces can be cleaned with a solution of TSP (tri-sodium phosphate) in water (one half cup TSP to one gallon of warm water).When using TSP, which is highly corrosive, wear gloves and eye protection.
Bleach is NOT recommended
The presence of organic (humic) materials, the pH (acidity/alkalinity) of the water, the surface material and contact time affect the effectiveness of bleach for disinfection. Since these factors are not generally controlled, bleach cannot be relied upon for disinfection.The most compelling reason for advising against bleach is that fumes are harmful but in addition, overuse of bleach will result in increased releases of chlorinated effluents which can be harmful to the environment.
• Surfaces that are dry and/or have not been directly affected by the flood water should be vacuumed with a HEPA vacuum cleaner. Further cleaning of concrete surfaces can be done with TSP. Washable surfaces can be washed with unscented detergent and water. Surface mold on wood can be removed with a vacuum-sander. Do not sand without simultaneous vacuuming.Wood that looks moldy after sanding may need to be replaced.
• After cleaning the surfaces, ventilate or dehumidify the house until it is completely dry. Rapid drying is important to prevent mold growth. When the outside weather permits (low humidity and moderate temperature), open doors and windows and hasten the drying process with fans. If the outside weather is not suitable and you notice that drying is not happening fast, use dehumidifying equipment, renting extra units as necessary.
To determine if the outdoor air can help dry the air inside, place a hygrometer in the area to be dried. Let it stabilize then open a window and monitor the Relative Humidity (RH). If it goes down then it means the air is dry enough to assist the drying process. If the RH increases, close the window.
• Carpets must be dried within two days. Sewage-soaked carpets must be discarded. Homeowners can’t effectively dry large areas of soaked carpets themselves. Qualified professionals are required.
• Ensure that all interior cavities and structural members are completely dry (which could take weeks) before closing cavities.

What to Keep or Discard

• Discard and replace all insulation materials, and all less-expensive articles that have been soaked, including particleboard furniture, mattresses, box springs, stuffed toys, pillows, paper and books.
• Separate valuable papers. Ask a lawyer whether you should save the papers themselves or just the information on them.
• The frames of good quality wood furniture can sometimes be salvaged, but must be cleaned and dried by ventilation away from direct sunlight or heat. Consult a furniture restoration specialist. Coverings, paddings and cushions must be discarded and replaced.
• Scrape heavy dirt from washable clothes, rinse and wash several times with detergent and dry quickly.

Before Moving Back In

• Do not use flooded appliances, electrical outlets, switch boxes or fuse/breaker panels until they have been checked by your local utility.
• If they have been soaked, consult an HVAC (Heating,Ventilation and Air Conditioning) contractor to replace the furnace blower motor, switches and controls, insulation and filters. Inspect all flooded forced air heating ducts and return-duct pans and have them cleaned out or replaced. Seek advice from your local utility about a water heater that has been wet. Refrigerators and freezers may need to be replaced.
• Flush floor drains and sump pits with detergent and water and scrub them to remove greasy dirt and grime. Clean footing drains outside the foundation if necessary.

At The Mortgage Group we take the headache out of it for you. Not only that, but we provide a wide array of mortgage products. From first to second mortgages, to approvals without income confirmation, we can get you approved.