Former CREB® president Greg Houston remembers 1989 as the year it all started to turn around
The boom came back.
After a lengthy slump in the early 1980s, Calgary’s real estate market began a resurgence in 1989 – and not a moment too soon, recalls Greg Houston, who was president of CREB® that year.
“1989 was a great year,” he said. “Things were looking up. There was stability in the business, after years of foreclosures and people declaring bankruptcies. As far as I was concerned, things were finally turning around.”
As oil and gas prices stabilized, job opportunities appeared and people moved to Calgary, once again, strengthening demand for real estate. Building permits and housing starts increased, as did activity in the resale market, recalled Houston.
“Then we had the Olympics in 1988, and that was exciting for Calgary.”
“The 1980s were difficult – up to 1987, even,” he said. “Then we had the Olympics in 1988, and that was exciting for Calgary. It brought hope from the National Energy Program and its fallout during the early 1980s.”
The real estate industry’s other primary concern in 1989 involved educating members and the public on a federal court ruling from the year prior that prohibited the fixing or controlling of commission rates.
“My predecessors were more involved in the Competition Bureau and the decision, while we had to comply with the order,” said Houston. “We had a legal framework we were supposed to be operating in.”
The order prohibited the controlling of the commission split between listing and selling brokers. It also encouraged board members to co-operate with non-members, such as discount brokers or direct sales by homeowners. Boards could not discriminate against real estate professionals on the basis of the commissions they charged.
It was up to Houston, and the board, to communicate the bureau’s ruling to the public – making them more aware of flexible commission rates. The changes also led to the opening of local real estate companies offering discounted commission fees.
Houston describes himself as an “unconventional” real estate professional. He moved from Saskatchewan to Alberta and entered the industry in 1972, following in the footsteps of his mother, who was also in the business.
Houston started his own real estate company in 1977, called Cosmic Realty (he later changed the name). His focus has long been on commercial real estate.
“We had desk fees, which was unheard of in those days,” Houston said.
The structure worked – Houston said he attracted a “good, solid group of people committed to the same values of honesty and integrity.”
The company grew, and at one point Houston employed 28 people. The 1980s were tough, however. Houston can still remember June 1982 when there was just one sale in the office.
“Everyone was jumping ship,” he said.
Things got better toward the end of the decade, he remembers, describing the Olympics as “huge” for Calgary.
The city has continued to grow and change in the years since. “I look at developments now, and the class of them, and it’s just ‘Wow,’” said Houston.
The biggest change in the industry has been the blending of technology with sales. “The technical aspects of the business have become very sophisticated.”
Houston can still remember the size and speed of his first cellphone and computer, which seem laughable compared to what exists today. “Those changes have been so dramatic.”
“Another big change has been the professionalism of salespeople has been elevated through education, regulation and technology,” he said. “People nowadays are very informed.”
When asked about the current downturn, Houston does not seem overly worried.
“It is tough and will be difficult for a couple of years,” he said. “But this is a cycle, and this too will pass. It’s happened several times in my lifetime, and it will happen again.”
He’s quick to point out current interest rates are nowhere near as high as they were in the 1980s.
“We’ve had stable, low interest rates for a long time, and that’s very helpful for our business,” Houston said. In 1989, while on the campaign trail, then-premier Don Getty announced a program to shelter homeowners from soaring interest rates.
“I’m positive that the future will be better than it’s anticipated to be at the moment. People here have to remember, the quality of life here is incredible. You can call that western ingenuity or the spirit of the new west – whatever – but it’s appealing.”