What’s the Difference Between An Addendum & An Amendment? (Alberta)

questionTwo real estate forms that cause confusion are the Addendum and the Amendment.  They are not interchangeable and are needed at different times in the offer timeline.

An Addendum is to be used concurrently with the offer, before final signing, when there is insufficient space in the body of the purchase contract to include all the information.   (Addendum Sample pdf)

Oftentimes, the addendum is used for clause 1.3 of the purchase contract if there are a considerable amount of chattels to list, or for 7.6 if the terms are lengthy.

An Amendment is a change agreed to by the parties after the initial execution of the contract.  If the Purchase Contract has had final signing, an Amendment is required to make any additions or deletions to it. (Amendment Sample pdf)

Whether the buyer forgot to include the dishwasher under clause 1.3, the closing date needs to be changed, or the home inspection revealed a defect that the seller agrees to repair before the possession date, this needs to be documented using an Amendment.

Understanding when to use which forms is essential for a legally binding contract and only a small aspect of a successful  real estate transaction.  I would be glad to represent you as either a buyer or seller’s agent.  Feel free to contact me at 403-554-2284 or at mike@findcalgary.com

The comments expressed in this article are for information purposes only for the Province of Alberta and serve to highlight general principles. Each situation is different and you should seek legal counsel before pursuing any particular course of action. These articles do not create an agency relationship and do not constitute legal advice.

July 1-21, 2015 Calgary Real Estate Market Update

“Calgary’s resale housing market has experienced a whirlwind start to the year. And while oil price recovery has been slower than originally expected, there are positive signs of change on the horizon,” writes CREB® announcing a mid-year forecast update which will be released at the end of this month.

Back in January, the CREB® forecast was optimistic considering what the December data was signaling.  A sales decline of only -4% and an increase in home prices in 2015?  It seemed wishful, especially since no one had any idea of where oil prices were headed and for how long.

So where are we six months later?  Year-to-date sales are down -25% compared to the same period last year.  That forecast missed the mark and will unlikely make any ground in the second half of the year.  But prices have been holding up remarkably well with the YTD benchmark price still up 3.3% at the end of June.

In fact, the market outlook for Calgary has changed significantly enough from the beginning of the year when TD stated that the Calgary market was likely to correct,  that they released a revision this past Friday.

TD Economics is now expecting a -24.7% drop in sales this year before posting a slight uptick of 1.7% in 2016.   Originally, sales were forecast to fall -47.2% this year and a further -1.9% next year.

Average prices are projected to fall by only -1.7% this year instead of  the -4.4% predicted in February.   And rather than prices dropping a further -3.4% next year, prices will see a 0.4% bump instead.   If that’s how it transpires, then we’d be extremely fortunate to come through this downturn relatively unscathed.

July figures continue to point to a stabilizing market.  Sales are plodding along the 10-year average pace and are keeping new listings from adding any significant volume to overall inventory.   Prices are essentially flat with the median price up 2.37% MTD and the average down -0.71%.

After “the whirlwind start to the year”, this change of pace is welcome.

TD forecast

TD forecast comparison

Calgary home sale July 21 2015

Calgary home sale July 21 2015

Calgary New Listings July 21 2015

Calgary New Listings July 21 2015

Calgary luxury home sale July 21 2015

Calgary luxury home sale July 21 2015

Sales-to-new-listings ratio July 21 2015

Sales-to-new-listings ratio July 21 2015

Calgary Real Estate Stats Summary - July 21 2015

Calgary Real Estate Stats Summary – July 21 2015

July 1-14, 2015 Calgary Real Estate Market Update

The Bank of Canada cut its key rate to 0.5% today despite concerns of Canadians accumulating even more debt or further stoking the already hot real estate markets of Vancouver and Toronto.

It’s welcome news here in Calgary where the market is seeing “signs of turning around, or at least stabilizing…[the] deep dive in new listings has helped re-balance the market and stem the price decline.” (Source: BMO)

TD has already reduced their prime lending rate, but by only 0.1%.  Other banks will follow suit with cuts of their own which will help nudge some buyers off the fence and spur additional activity.

Sales in Calgary remain below year ago levels but are balanced out by a reduction in new listings.  A total of 851 homes have sold through two weeks, down -16.57% year-over-year but off the 5 and 10 year average by only -5% and -2.3%.

New listings are down -10.59% from last July.  Compared to historical levels, they are up 0.48% from the 5 year average but below the 10 year average by -7.58%.

It’s shaping up to be a stable month which will benefit from the extra little push thanks to the Bank of Canada.

Calgary home sales - July 14 2015

Calgary home sales, July 1-14, Y/Y comparison

Calgary New Listings - July 14 2015

Calgary New Listings, July 1-14, Y/Y comparison

Calgary luxury home sales - July 14 2015

Calgary luxury home sales, July, Y/Y comparison

Sales to New Listings Ratio - July 14 2015

Sales to New Listings Ratio, July 1-14

Calgary Real Estate Stats Summary - July 14 2015

Calgary Real Estate Stats Summary, July 1-14, Y/Y comparison

Calgary Home Prices Rebound In June

Calgary home prices bounced back in June following a record drop the previous month according to the Teranet–National Bank House Price Index released today.

Prices fell -3.3% in May, the largest monthly drop recorded for the region and for the first time since July 2011, were lower than the year before.

Most of those losses were erased in June as Calgary house prices rebounded 2.5% month-over-month and eked out a 0.2% year-over-year gain.   Prices are now off -2.7% from the October 2014 peak.

The Teranet–National Bank House Price Index™ is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index. This is known as the repeat sales method.

Year-over-year percent change

Year-over-year percent change

Month over month percent changes

Month-over-month percent changes

Calgary House Price Index

Calgary House Price Index

TD Forecasts Rosier Real Estate Outlook For Alberta

TD Economics has released an updated forecast for Canadian real estate and the outlook has vastly improved from earlier this year.

Back in January’s forecast, the majority of provinces were expected to see average home prices fall in 2015 with Ontario posting the highest gain at only 3.1%.   In Alberta, prices were projected to drop -3.5% in 2015 and a further -1.3% in 2016.

Now it appears that conditions across the nation aren’t as bleak as previously thought.   TD anticipates BC will lead with average price growth at 9.2%, followed by Ontario with 7.9%.   Alberta average prices are still expected to decline, but only by -1.8% this year before reversing course and gaining 0.4% next year.

What hasn’t improved much is the sales forecast for Alberta, revised to fall -19.2% instead of the original -20.8%.

You can download the full July forecast from TD here.

TD forecast comparison: January and July

TD forecast comparison: January and July

Calgary New Home Price Slide Pauses In May

After falling -0.4% in both March and April, Calgary new home prices remained unchanged in May according to Statistics Canada.  The last monthly increase was recorded back in December (0.1%).

On an annual basis, the New Housing Price Index for Calgary was up 0.9%.  This was the smallest annual increase since February 2012.

The New Housing Price Index  covers the following dwelling types: single dwellings, semi-detached and row houses.  Apartments are not part of the index.

NHPI Percent Change

NHPI annual percent change

NHPI monthly percent change

NHPI monthly percent change

July 1-7, 2015 Calgary Real Estate Market Update

It was an unremarkable first week of activity for Calgary’s real estate market and barring any sudden economic shifts, all signs points to stability in the short-term.

There were a total of 374 sales between July 1-7, a drop of -18.3% from the same time last year, but only off -5% from the 5 & 10 year average.

Helping to balance out the fewer sales was a -17.7% y/y reduction in new listings during the same period.    New listings were also -5% lower than the 5 year average and -13.5% below the 10 year average.

Month-end inventory peaked in March at 5,693 but has been trending lower each subsequent month and currently sits at 5,087 compared to about 4,828 exactly a year ago.

It’s early in the month to be looking at the prices but I wanted to explain the divergence between the Apartment average price showing a -13% drop while the median is up almost 11%.   Last July, a Princeton Hall unit sold for $4.4 million which was a new Calgary MLS® condo record which bumped up the average price for sales in the first week by nearly $48,687.

Meanwhile, job losses continue in Calgary’s energy sector: 130 were just laid off at Chevron following a recent announcement from TransCanada Corp of 185 layoffs late last month.

Calgary home sales July 7 2015

Calgary home sales July 7 2015

Calgary new listings July 7 2015

Calgary new listings July 7 2015

Calgary luxury home sales July 7 2015

Calgary luxury home sales July 7 2015

Sales-to-new-listings-ratio July 7 2015

Calgary Stats Summary July 7 2015

Calgary Stats Summary July 7 2015