Former CREB® president Ron Stanners recalls local housing industry slows down slightly in 2007 after break-neck speed years prior
Over the past five decades, Calgary’s real estate industry has been bare to it all – from double-digit interest rates to densification. As part of an ongoing series, CREB®Now continues to weave together an incredible narrative of how the local housing industry has evolved through the unique perspectives of CREB®’s 30 remaining past presidents.
Following two “absolutely crazy” years in Calgary’s real estate market, Ron Stanners almost looked forward to the slightly slower pace when he became CREB® president in 2007.
“It was a good year, but it was not the boom of the years before,” he said.
“The first half of the year had good, solid sales. Then, sales did slowdown in the latter half. That’s normal, but they slowed more than normal.”
According to CREB®, residential resale housing sales slipped slightly by 2.7 per cent to 26,260 units, while the benchmark price surged by 22 per cent to $411,442.
Not bad, considering 2006 was a record-setting year, in which Stanners remembers his predecessor Kevin Clark calling it “the perfect real estate storm.”
The slower pace in 2007 didn’t come as a big surprise to Stanners though given what was happening south of the border. That year marked the U.S. housing market crash when credit markets froze and homeowners were unable to keep up with high-interest loans.
“Going into 2007, there was all kinds of evidence in the U.S. of the real estate market crashing. Historically, Canada follows about six months later. People were predicting dire circumstances,” said Stanners.
In fact, it took until 2008 for the Calgary market to really stall amid the global financial crisis and declining oil prices. In 2007, however, Stanners remembered an attitude of optimism present in Calgary.
“One of the biggest issues was first-time homebuyers qualifying,” he said. “Prices had risen so much, it was difficult for first-time buyers to put money together, as the amountof money needed had gone up.”
The year prior, 40-year mortgages with no down payments became available in Canada, lasting until 2008. (35-year amortization periods were fazed out in 2011.) Still, Stanners recalled many buyers still turned to more affordable condominiums, with sales topping 3,250 units in Calgary, according to CREB®.
In 2007, CREB® also became the first real estate board in the country to introduce online open houses. Stanners said the tool was a way to help sellers standout in a competitive market, while also making it easier for buyers to view homes.
“Around that time, the idea of having videos online of homes was gaining broader acceptance,” he said. “We put a system in place so REALTORS® could upload more pictures and videos.”
Stanners noted technological change has been a theme that’s consistently come up during his 35 years in real estate. He said many real estate professionals, himself included, have had to continually adapt to ongoing changes in consumers’ expectations of the homebuying process, as well as how industry professionals themselves interact.
“Today, offers are by email,” he said. “The buyer’s representative almost never meets the seller’s representative. There are disadvantages to that, in some ways,” he said.
“Millennials, the younger generation, don’t want to talk on the phone. My generation would pick up the phone and work it out. It’s a change in style of generations.”
In addition to technology, Stanners sees increased regulations as having an impact on declining face-to-face contact. In the 1970s and 1980s, buyers’ and sellers’ representatives would negotiate directly with each other on their clients’ behalf. Today, Real Estate Council of Alberta regulations prohibit agents from representing their clients without expressed permission.
“Before, REALTORS® worked together to consummate the sale. Now, we represent clients solely, as that’s required by law,” said Stanners. “Back in the ’80s, if I was representing the buyer, I could go to present to the seller and have the opportunity to humanize my client.”
While Stanners thinks such changes and high standards benefit the public, they’ve also affected how industry professionals interact.
“It’s changed the way we dealt with each other,” he said.