coldrsx
November 9th, 2005, 06:56 PM
Edmonton (alberta) is smoking hot
BUSINESS
Business | canada.com Financial News
Alberta the exception to housing starts slowdown
Numbers down 14 per cent across nation
Ron Chalmers
The Edmonton Journal
Wednesday, November 09, 2005
EDMONTON - The strong housing market is slowing in most of Canada -- but not in Alberta.
Canada's new housing sector has gone "past its peak in terms of growth," says a Commentary issued Tuesday by Derek Burleton at TD Economics.
Starts of single-family homes, which he believes are the best measure of underlying economic development, are down 14 per cent for the year to date.
For next year, Burleton predicts "a more significant slowdown in housing."
He expects total starts, including multiples, to drop from 233,000 last year to 220,000 this year, and 195,000 in 2006.
Housing starts must decline because they have outpaced population growth.
"A sustainable pace of starts based on demographic requirements is about 175,000 units per year," Burleton calculates.
But construction is regionally uneven, and he expects western Canadian activity to remain firm.
Northern Alberta has been especially hot.
In greater Edmonton, single-family starts are up 14.9 per cent for the first 10 months of this year, from the same period last year.
"Should this pace be maintained to year-end, the industry will easily exceed 7,000 units for the first time ever," Richard Goatcher, senior market analyst at Canada Mortgage and Housing Corporation, said Tuesday.
Total Edmonton-area starts are up 19.7 per cent to 10,937.
Total starts are up 17.7 per cent in Grande Prairie and 88.8 per cent in Wood Buffalo, including Fort McMurray.
Re/Max is especially bullish on Canadian home sales.
"Immigration is expected to play a greater role in residential real estate markets across the country," according to that realtor's Housing Market Outlook for 2006, released Tuesday.
"Canada is opening its door to as many as 255,000 new immigrants in 2006 and that figure may be ramped up in the future in an attempt to counteract a declining birthrate and aging population."
In Edmonton's resale housing market, "unit sales are expected to rise to record levels in 2005, reaching 18,350 units by year end -- an increase of four per cent over 2004 levels," Re/Max projects.
The company expects continued strength, with more than $60 billion of energy-related projects planned for northern Alberta -- plus infrastructure, commercial and institutional construction spurred by the growth.
In Edmonton, "unit sales are forecast to rise five per cent to 19,250 units by year-end (2006) while average price is expected to climb five per cent to $202,650," according to Re/Max.
rchalmers@thejournal.canwest.com
© The Edmonton Journal 2005
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White-hot sales will make for cool Yule in Alberta-advantaged Edmonton
Eric Beauchesne
CanWest News Service
Wednesday, November 09, 2005
OTTAWA - The holiday season will be ho-hum for many Canadian merchants -- but ho-ho-ho in Edmonton.
Consulting firm Ernst & Young predicted in its 2005 holiday sales forecast released Tuesday that Canadian retailers can expect a five- to six-per-cent increase in holiday spending. That would be only marginally better than last year, when sales rose by less than five per cent to what it called a "relatively restrained" $50 billion.
"We don't see any chance for really aggressive growth in retail sales in Canada again this year," said Jacques Dostie, head of Ernst & Young's retail group. "And while the forecast is for positive growth over the November and December time frame, even that slight growth will not automatically translate into increased profit."
In Edmonton, however, "it will be a good year for retailers," said Logan Day at the local Ernst & Young branch.
"Alberta is hot but Edmonton is white hot," he said. "Oil and gas service businesses are doing very well. Some of them pay Christmas bonuses, some pay year-end bonuses."
Edmonton's unemployment rate, among the lowest in Canada, also means more spending power, he said.
"In January, we all are getting a Christmas present from the government," Day said, referring to the $400 payments to be funded by the provincial government's surplus. He thinks high-end retailers will especially gain, with extra disposable income going to jewelry, wearable electronic technology and possibly fur coats.
Record housing starts in Edmonton also will contribute to holiday-season spending on furniture and home decor, Day said.
Nationally, higher distribution and energy costs, and overall higher inflation, will cut into profit margins this season as retailers will be hesitant to pass those added costs onto the consumer, he added.
Dostie stressed that despite slow growth, sales will be higher than last year, as consumers are not expected to cut spending dramatically with interest rates still low and credit readily available.
Also, while high gasoline prices are eating into consumers' disposable incomes -- and may limit their shopping trips-- they are expected to boost online shopping.
To counter expected sluggish sales, retailers started promoting holiday sales earlier this year, the report noted.
"We're seeing this strategy through the introduction of holiday merchandise and marketing efforts that began in October," Dostie said. "As well, a tactic being seen more often has retailers offering a varied assortment of 'fresh' items intended to bring shoppers back numerous times."
Such "fresh" items comprise merchandise that move fairly rapidly off the shelf and then is changed.
For instance, a clothing store may put out red-and-green sweaters in October and then switch to another colour for the November and December period so that consumers see something new.
The elimination of import quotas on clothing, meanwhile, will allow retailers to cut prices significantly to offset what the report claims is a lack of any new or compelling fashion trends, as well as weak consumer demand.
The forecast also suggests retailers take advantage of a growing focus by consumers on luxury items and private-label merchandise, where the profit margin is higher.
"Upscale, designer-label and limited-edition products will be in greater demand," it predicted.
© The Edmonton Journal 2005
__________________
Ottawa - Edmonton - Vancouver - Edmonton
-------------------------------------------------------------
Trying to get Murman on late night tv since 2005.
BUSINESS
Business | canada.com Financial News
Alberta the exception to housing starts slowdown
Numbers down 14 per cent across nation
Ron Chalmers
The Edmonton Journal
Wednesday, November 09, 2005
EDMONTON - The strong housing market is slowing in most of Canada -- but not in Alberta.
Canada's new housing sector has gone "past its peak in terms of growth," says a Commentary issued Tuesday by Derek Burleton at TD Economics.
Starts of single-family homes, which he believes are the best measure of underlying economic development, are down 14 per cent for the year to date.
For next year, Burleton predicts "a more significant slowdown in housing."
He expects total starts, including multiples, to drop from 233,000 last year to 220,000 this year, and 195,000 in 2006.
Housing starts must decline because they have outpaced population growth.
"A sustainable pace of starts based on demographic requirements is about 175,000 units per year," Burleton calculates.
But construction is regionally uneven, and he expects western Canadian activity to remain firm.
Northern Alberta has been especially hot.
In greater Edmonton, single-family starts are up 14.9 per cent for the first 10 months of this year, from the same period last year.
"Should this pace be maintained to year-end, the industry will easily exceed 7,000 units for the first time ever," Richard Goatcher, senior market analyst at Canada Mortgage and Housing Corporation, said Tuesday.
Total Edmonton-area starts are up 19.7 per cent to 10,937.
Total starts are up 17.7 per cent in Grande Prairie and 88.8 per cent in Wood Buffalo, including Fort McMurray.
Re/Max is especially bullish on Canadian home sales.
"Immigration is expected to play a greater role in residential real estate markets across the country," according to that realtor's Housing Market Outlook for 2006, released Tuesday.
"Canada is opening its door to as many as 255,000 new immigrants in 2006 and that figure may be ramped up in the future in an attempt to counteract a declining birthrate and aging population."
In Edmonton's resale housing market, "unit sales are expected to rise to record levels in 2005, reaching 18,350 units by year end -- an increase of four per cent over 2004 levels," Re/Max projects.
The company expects continued strength, with more than $60 billion of energy-related projects planned for northern Alberta -- plus infrastructure, commercial and institutional construction spurred by the growth.
In Edmonton, "unit sales are forecast to rise five per cent to 19,250 units by year-end (2006) while average price is expected to climb five per cent to $202,650," according to Re/Max.
rchalmers@thejournal.canwest.com
© The Edmonton Journal 2005
------------------------------------------------------------------------------------
White-hot sales will make for cool Yule in Alberta-advantaged Edmonton
Eric Beauchesne
CanWest News Service
Wednesday, November 09, 2005
OTTAWA - The holiday season will be ho-hum for many Canadian merchants -- but ho-ho-ho in Edmonton.
Consulting firm Ernst & Young predicted in its 2005 holiday sales forecast released Tuesday that Canadian retailers can expect a five- to six-per-cent increase in holiday spending. That would be only marginally better than last year, when sales rose by less than five per cent to what it called a "relatively restrained" $50 billion.
"We don't see any chance for really aggressive growth in retail sales in Canada again this year," said Jacques Dostie, head of Ernst & Young's retail group. "And while the forecast is for positive growth over the November and December time frame, even that slight growth will not automatically translate into increased profit."
In Edmonton, however, "it will be a good year for retailers," said Logan Day at the local Ernst & Young branch.
"Alberta is hot but Edmonton is white hot," he said. "Oil and gas service businesses are doing very well. Some of them pay Christmas bonuses, some pay year-end bonuses."
Edmonton's unemployment rate, among the lowest in Canada, also means more spending power, he said.
"In January, we all are getting a Christmas present from the government," Day said, referring to the $400 payments to be funded by the provincial government's surplus. He thinks high-end retailers will especially gain, with extra disposable income going to jewelry, wearable electronic technology and possibly fur coats.
Record housing starts in Edmonton also will contribute to holiday-season spending on furniture and home decor, Day said.
Nationally, higher distribution and energy costs, and overall higher inflation, will cut into profit margins this season as retailers will be hesitant to pass those added costs onto the consumer, he added.
Dostie stressed that despite slow growth, sales will be higher than last year, as consumers are not expected to cut spending dramatically with interest rates still low and credit readily available.
Also, while high gasoline prices are eating into consumers' disposable incomes -- and may limit their shopping trips-- they are expected to boost online shopping.
To counter expected sluggish sales, retailers started promoting holiday sales earlier this year, the report noted.
"We're seeing this strategy through the introduction of holiday merchandise and marketing efforts that began in October," Dostie said. "As well, a tactic being seen more often has retailers offering a varied assortment of 'fresh' items intended to bring shoppers back numerous times."
Such "fresh" items comprise merchandise that move fairly rapidly off the shelf and then is changed.
For instance, a clothing store may put out red-and-green sweaters in October and then switch to another colour for the November and December period so that consumers see something new.
The elimination of import quotas on clothing, meanwhile, will allow retailers to cut prices significantly to offset what the report claims is a lack of any new or compelling fashion trends, as well as weak consumer demand.
The forecast also suggests retailers take advantage of a growing focus by consumers on luxury items and private-label merchandise, where the profit margin is higher.
"Upscale, designer-label and limited-edition products will be in greater demand," it predicted.
© The Edmonton Journal 2005
__________________
Ottawa - Edmonton - Vancouver - Edmonton
-------------------------------------------------------------
Trying to get Murman on late night tv since 2005.