The Edmonton Real Estate Blog

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Tuesday, January 31, 2006

Home renovations - get cash from cozy

Edmonton has plenty of character homes. Wartime bungalows and two story's from the early 1900's. Considering how new Edmonton is these are considered our character homes.

I've seen some great reno's on smaller homes that make cozy the "in thing" as opposed to large and cold. These are my own ideas of what has worked for us and our clients in renovating smaller properties. There are literally thousands of great opportunities in the Edmonton area alone. You just have to be consistent in applying the ideas you chose.

Some good ideas include:
  • emphasizing the key features of the home
  • Pay attention to details in smaller homes
  • PLEASE no lino (peal-n-stick) tiles...nothing screams this was done on the cheap more than lino tiles.
  • Use mirrors in small spaces to create the appearance of more space
  • Use imaginative storage concepts for creating space, storage value and appeal
  • Declutter. Need I say more? In the movies they use props to illustrate this. For example - small people carrying huge books makes the people look smaller. So using huge furniture in a small space will make the room look smaller.
  • Curb appeal is key - if it's broke, fix it. If its ugly on the outside changing the inside will not help.
  • Don't rule out expansion. Planning is the key here. Consistent lines and applications can add value but an extension that doesn't fit or look right could set you back. Make sure you get your permits.
  • Colors can make the biggest difference. Warm colors are good. Again, consistency is important.
If you are doing a renovation project or a "fixer upper" we will work with you past the point of sale on working with and acquiring trades people if needed. We'll give feedback on ideas and our recommendations for improving the value of your reno.

Call us today for more info and put our experience in your corner.
www.edmonton-homes.ca
780-486-8655

Monday, January 30, 2006

No Housing Bubble in Edmonton

The Conference Board of Canada has a ton of great information about the Canadian economy and other trends. The following is an exerpt from their "Inside Edge" newsletter.

"The Balloon is Swelling, But it Will Not Burst"

Through most of the 1990s, the Canadian housing market was soft, due to sharp increases in interest rates and to the jobless economic recovery early in the decade. That situation changed
late in the 1990s, as subdued house price inflation and lower interest rates made housing more affordable, a trend that continued into the new millennium. (See chart.) As a result, housing starts grew strongly—reaching more than 233,400 units in 2004, a level 43.4 per cent higher
than the 2001 rate. The resale market also enjoyed substantial growth.

Despite energetic home building activity, demand has continued to outstrip supply, leading to rapid price increases. New home prices rose by an average of 4.8 per cent annually from 2002 to 2004 and prices for existing homes increased even more, averaging 9.6 per cent annually over the same period. While rising prices led to a decline in affordability—especially in British Columbia, Ontario and Quebec— low lending rates kept housing relatively affordable throughout the country.

In the near future, continued price increases and rising interest rates will further reduce affordability—which will decline in all markets in 2006 and 2007 before stabilizing in the medium term. The main culprit will be mortgage rates, which are expected to rise by 150 basis
points between the first quarter of 2006 and the fourth quarter of 2007. Housing affordability is expected to settle at levels near the historical averages for most Canadian markets.

While affordability is forecast to decline, it will not fall to early-1980s or even early-1990s levels. In the medium term, affordability is expected to settle at levels near the historical averages for most markets. British Columbia is the exception—affordability in the province
is forecast to decline to below its historical average. In that province, average monthly household income is expected to settle at 5.1 times the average monthly mortgage payment, including capital and interest. In other words, 19.6 per cent of a household’s income would be needed to cover a mortgage payment on average. As a result, affordability will not be nearly
as problematic as it was in the early 1980s, when household income was just 3.2 times the monthly mortgage payment, or in the mid-1990s, when the figure was 4.5 times.

In short, the Canadian housing price balloon may swell over the short term, but it will not burst.
The Conference Board’s quarterly economic forecasts are available from e-Data, www.conferenceboard.ca/edata.htm.

Find out the value of your home.

Friday, January 27, 2006

More People are Investing in Real Estate

A report from Re/Max yesterday shows that 1 in 6 Canadians own an investment property, and close to 30% plan to buy and investment property in the next 12-24 months. Also of interest was that 43% of those that plan to buy in the next two years were under 40 years of age.

Their report speaks specifically of Edmonton real estate investments as well, stating returns have hovered at 10% annually since 2000. Forecasts call for continued increases due to a healthy Alberta economy, so more people are expected to jump in.

Here are the complete comments about Edmonton:
As housing values in Edmonton trend upward, more and more investors are setting their sights on real estate. Returns in recent years have been quite impressive, hovering at close to 10 per cent annually, since 2000. With housing forecasts calling for continued appreciation in coming years, thanks to a thriving provincial economy,
investors both small and large are capitalizing on real estate in Edmonton. Demand for income properties has been building since 2003. Spin-off from Ft. McMurray’s red-hot real estate market prompted some shrewd investors to park their dollars in income properties as early as 2003. Parents of university-age children seeking housing have also taken advantage of the upward momentum in the real estate market in recent years. Today’s investor is between 40 to 50 years of age, financially savvy and likely falls into the “baby boomer” demographic. Many have existing real estate holdings. Although a minute percentage will hire management companies, the vast majority will choose to maximize profits and self-manage. Smaller investors have found that condominiums offer an excellent starting point, with units in older, walk-up buildings starting at under $100,000. Newer units generally start at $125,000 to $150,000. The proverbial, single-detached ‘handyman’s special’ in an established, central neighbourhood can be purchased for as little as $150,000. Multi-unit residential properties are highly sought- after, but listings are few and far between. Because of limited inventory, duplexes, four-plexes and six-plexes that become available are quickly snapped-up. These properties generally start at about $250,000, but because they have more than one unit, the income potential is greater and the risk factor reduced. Despite growing demand for income properties, purchasers remain price-sensitive to all types of properties and those that are overpriced continue to stagnate.
The complete report includes reports on Halifax, Toronto, Ottawa, Edmonton, Calgary, Barrie, Winnipeg, Vancouver and Victoria and is available here.

Thursday, January 26, 2006

Is your mortgage tax deductible?

First of all I spent all night writing this article. Actually ok, that's not the case. This comes from one of the sharpest minds in the mortgage industry in Edmonton. If you are financing a home or refinancing your existing home then you should be dealing with a mortgage professional. If you don't know one then contact Gord McCallum with First Foundation Mortgages.

The following is copied out of Gord's newsletter to his clients and real estate professionals. What I like about this article is how it clearly adds value to his clients by providing very relevant information to Edmonton home buyers / home owners.

The Smith Manoevre

Is your mortgage tax deductible? Unless you're an American, or you've implemented one of the most exciting financial strategies known (or unknown) to Canadians, the answer is NO.

It can be though. At First Foundation we've been researching a financial strategy that, if implemented properly and with the wisdom, advice, and planning of a competent financial planner, can help you to drastically increase your net worth by making the interest you pay on your mortgage tax deducible. This can result in a windfall of free money from the CRA in the form of tax refund cheques which you can use to vastly improve your retirement savings and net worth.

Don't take my word for it. I didn't invent it, but the man who did, Fraser Smith, has written an excellent book on the subject and has been in high demand as a speaker across the country. I had the pleasure of taking in one of his presentations, reading the book, watching the powerpoint presentation, and playing with the calculator. I'm sold.

If you, anyone you know, and/or your financial planner wants more information, please have them give me a call. This simple, easy, time (and CRA) tested strategy could be worth hundreds of thousands of dollars to you at retirement. I don't want this newsletter to sound like an infomercial, but it really is worth your while to discuss this with your financial planner. We can set up the mortgage properly for you to successfully execute the Smtih Manoevre, but your Financial Planner has the expertise to advise you properly before you do anything.

For more information, give us a call or check out the Smith Manoevre Website.

You'll thank me later...


Thanks Gord I appreciate this.

Monday, January 23, 2006

Alberta Oil Sands booming


This is from a post from Peak Oil News.

It origionally a report from CBS news on the Alberta oil sands.

There’s an oil boom going on right now. Not in Saudi Arabia or Kuwait or any of those places, but 600 miles north of Montana.

In Alberta, Canada, in a town called Fort McMurray where, this time of year, the temperature sometimes zooms up to zero.

The oilmen up there aren’t digging holes in the sand and hoping for a spout. They’re digging up dirt — dirt that is saturated with oil. They’re called oil sands, and if you’ve never heard of them then you’re in for a big surprise because the reserves are so vast in the province of Alberta that they will help solve America’s energy needs for the next century.

Within a few years, the oil sands are likely to become more important to the United States than all the oil that comes to us from Saudi Arabia.

Correspondent Bob Simon reports.

story continued

House Price comparison index 2006


A guide for comparing home prices accross North America

The 2005 Home Price comparison index compiled by Coldwell Banker Real Estate Corporation allows you to quickly approximate how much your home might be be worth in any of over 300 markets across North America.

To view the Home price comparision index click here.

For information on home values in Edmonton Alberta visit www.edmonton-homes.ca



Saturday, January 21, 2006

Accused Fraudster Out on Bail

Scott Park, a lawyer accused in the huge mortgage fraud case has been released on bail, according to a story in the Edmonton Sun today. He was previously ordered kept behind bars, but is now out on $5000 bail. He is not allowed to take part in any real estate transactions while he's out.

From what I read, of the six people charged in the case, only one remains behind bars - Pedro Brito, who turned himself in to police.

Here is the complete article by Tony Blais:

A city lawyer charged in a massive fraud case got bail yesterday after a judge overturned an earlier decision by a justice of the peace to keep him behind bars.

Scott Park, 40, was ordered released on $5,000 cash after the Court of Queen's Bench bail review.

He is also banned from taking part in any real estate transactions.

Park, a defence lawyer who is also a high-level curler who has played at the provincial championship level, is one of six people charged in a mortgage-fraud case believed to be the largest ever in Alberta.

Meanwhile, one of the other accused, Pedro Brito, 32, is behind bars after turning himself in to police. There had been a warrant issued for his arrest.

Also charged are Gohar Ahmed Pervez, 43, who is alleged to be the kingpin, Harkamaljit Kahlon, 29, Terry Lynn Ellis, a 59-year-old paralegal, and Rodrigo Caroca, 32.

Caroca was earlier released on $5,000 bail.

Police say the mortgage-fraud case involves 142 charges, including one under federal anti-gang laws alleging the fraud was done for the benefit of a criminal organization, and the extent of the alleged fraud is about $30 million.

RCMP Insp. Joe Loran, head of the Integrated Response to Organized Crime in Alberta, said earlier the charges relate to 118 properties in Edmonton and six in Camrose.

"It involves alleged fraud committed in regards to mortgage applications involving a number of financial institutions," said Loran, adding the IROC team has been involved in the investigation since January 2003.

A typical mortgage fraud scheme involves giving a cheap property a far higher mortgage value through trickery or fraud. Ultimately, the unsupported mortgage is assumed by an unsuspecting buyer.

Pervez has been in the news before for buying rundown city homes and turning them over at substantial increases in value, even though some are subsequently again condemned, and many buyers or banks are left holding properties allegedly worth far less than their mortgages.

Tuesday, January 17, 2006

Five Easy Steps to Buying a Home

This article from AREA (Alberta Real Estate Association) outlines the five steps to buying a home. It goes through the different roles and expectations of everyone involved, including a real etate agent, a home inspector, a land surveyor and a lawyer.

Download the article here (pdf).

If you have any questions about the homebuying process, don't hesitate to contact us. Search all Edmonton MLS listings at www.edmonton-homes.ca.

Saturday, January 14, 2006

Edmonton and area Online Home Evaluations

If you're home is in the Edmonton area we can do a complimentary online home evaluation for you. Just click here.

Friday, January 13, 2006

Housing Prices in Edmonton Soar

Another report was released by Royal LePage yesterday, and shows that the fourth quarter of 2005 was remarkably strong, with Bungalows showing the largest year over year increase. Edmonton had the third largest increase in the country after Victoria and just slightly behind Calgary. Rising demand in Edmonton and Calgary lead to low inventory levels and increased prices.

"High energy prices and resource development in Northern Alberta continued to drive a strong housing market in Edmonton, with all three housing types experiencing substantial price appreciations in the quarter. A tight labour market leading to high income growth and corresponding consumer spending has helped stimulate much of the growth in the housing market."

"The country's economy is operating at full capacity and isexpected to do so through 2007. A tight labour market will mean highersalaries and more money in people's pockets. That money will continue to findits way into housing, as the family home continues to be one of the soundestlong term investments a Canadian can make. Balancing this, we will seemoderately higher interest rates to thwart inflation, which will help keep alid on house price increases in most of the country."

Full article here.

Alberta's New Home Industry at Full Capacity

"Alberta's new home industry is running out of everything...except buyers." So says an article from the Globe and Mail. It focuses mostly on the Calgary market, but states "in 2005...starts in Edmonton jumped 16%, the greatest increase in the country."

"Concrete for foundations has been rationed. Lumber is in short supply. Inventories of cabinets, water pipes and, one builder says, kitchen sinks and plumbing fixtures are all being drained. And, then there is the worst shortage of all: The skilled hands to build the bungalows, condos and dream mansions to accommodate Alberta's swelling population."

"There is a shortage of skilled labour across Canada, but Alberta has been hit particularly hard, since the oil sands megaprojects in the province's north are employing thousands of workers."

"The residential construction sector is largely not unionized, but the Alberta Building Trades Council says it is certain that workers are moving from the relatively lower paid jobs in the south to join its ranks. ...workers on industrial projects are paid at least $31 an hour, plus benefits, better than the hourly rate of $27 for high-rise residential construction, and much higher than for work on single residences."

Full article here.

The word on the street is that many new home builders are increasing, or already have increased, their prices by 15%. Search all Edmonton MLS listings from our website, or contact us for help finding your new home..

Potential Petroleum Plaza Improvements

The Edmonton Journal reports that after 15 years with no commercial development in Edmonton's downtown core, a 13-story addition may go on to the Petroleum Plaza towers. "The addition wouldn't be a plain vertical office block. Instead, it would be an L-shaped structure, which will wrap around the front of the north tower, then fill in the gap between the two existing towers, effectively grafting the three structures together as one complex." The design has been approved by the city's urban design pannel and features "striking glass curtain walls, tinted light green, with grey accents."
Full story here...

Thursday, January 12, 2006

House prices in Edmonton - Forecast

For the the past 18 years the Edmonton Real Estate board has been putting on a forecast seminar with different presenters from, CMHC (Canada Mortgage and Housing), Econonomic development Edmonton ,The Edmonton Real Estate Board, The Greater Edmonton Home builders association (well yesterday they actually just read a paper written by a professor from York university, so we won't count their presentation), and Capital City savings (a small regional lender).

I have attended all but a few of these crystal ball sessions and can report acccurately that it's a good idea to gather different opinions. Richard Goatier of CMHC is generally one of the best presenters. He's fairly conservative in his projections and leans heavily on net migration and previous results, but generally speaking has in my opinion come the closest most often.

As far Economic Development Edmonton, you won't hear much negative out of them, and to be honest there's not much bad to say with GDP growth that will lead the country and be possibly 2nd in the G8. It's just their culture is more cheer than stats so I lean to the CMHC stuff.

The following are the highlights of the forecast seminar:

  • The best news is yet to come. Currently the province receives only a very small percentage of oil revenues. This is due to the "Declaration of Opportunity" incentive deal made by the province with the Oil companies so that they would invest their capital to get the infrastructure built. As their infrastructure is paid off the provinces royalties jump to 25% . It is estimated that over the next 20 years the province will receive 95 Billion dollars in oil revenues based on oil at $40/ barrel. So with oil floating between $45 and $60 there is a big upside for the province of Alberta.
  • Edmonton's unemployment rate is expected to be below 4%, with skilled labour in huge demand (this should lower vacancy rates, and increase property prices by increasing net migration to Edmonton)
  • Net migration (the number of people who move here minue the number of people who move out) is expected to be positive at around 10,000.
  • Inflation is expected to remain low at around 1.4%
  • CMHC expects about 10,000 new jobs to be added to the Edmonton economy
  • 2005 saw the most housing starts in Edmonton's history at 7,600 units
  • By mid way through 2005 the average cost to build a home was at approximately $142/ square foot, as compared to $108/s.f. only five years earlier
  • Costs for constructing new properties will increase significantly with the average new house in Edmonton costing $295,000 in 2006, up almost 10% from $268,500 in 2005
  • 2006 is expected to be the second best year on record for housing starts with 7,100 anticipated
  • New multi-units have peaked but their inventory level remains high
  • Resale inventory levels continue to drop putting pressure on prices to increase
  • The average single family home is expected to climb in value by 9.3% to $234,000 versus $220,000 in 2005, but due to higher inventory levels the average condo price is only expected to increase around 4%
  • Apartment vacancy rates will drop to around 4%. Not enough for rents to really escalate for now
That's really the nuts and bolts of the seminar. If you have any questions or wish to verify any information you can contact the poster (just poster - not poster boy) or vist my website at www.edmonton-homes.ca

If you are looking for an evaluation on your existing home or investment property and it is located in the Edmonton area fill out this form for a free online evaluation.

Tuesday, January 10, 2006

Rape is a risk when selling

These are one of those stories you hate to publish. Its too ugly to think about but it is the reality of agents and sellers everywhere. This is meant to inform people so that can take appropriate precautions. If you want further details click here.

Downtown Mega Project Two Years Late

This article, from the Edmonton Journal talks about the commercial projects in the downtown Edmonton core. It's a good sign that just because our market is hot, there isn't senseless over building going on, leading to an over supply situation...

Though downtown condo construction is booming, Edmonton's office market overall has been slow to recover from the double whammy of provincial government cuts and the economic downturn of the early '90s, he says.

"Edmonton just historically hasn't been a big office city. It's been seen more as a blue-collar type of city. Your office tenants are the ones associated with the sheer size of the population: financial firms, legal firms, the big government sector. They lend stability to the market, but it hasn't grown," says the Calgary-based Gigliuk.

More...

Thursday, January 05, 2006

2005 Market Results Phenominal

More good news about 2005 and the future from the Edmonton Sun...

Outgoing Edmonton Real Estate Board (EREB) president Jim Kulak drew his 2005 bottom line, and announced sales records almost too numerous to list.

Next Wednesday, new-crowned EREB boss Madeline Sarafinchan will try to repeat Jim's magic when she holds her big housing forecast seminar at the Westin. It could be a tough act to follow for the Jayman Realty managing partner.

Or maybe not.

Yesterday, the Bank of Montreal's chief economist Richard Egelton checked in with an analysis of where we go from here. If Egelton's crystal ball is anywhere close to being in focus, then Sarafinchan should have no problem topping Kulak's year in the realty czar's chair. And I'm sure Jim won't mind a bit.

"Oil's well" Egelton whooped about Alberta's long-range economic outlook. "A gusher of activity in the energy sector has Alberta on a roll ... fuelled by high prices and development of the oilsands."

And he listed all the advantages of being Canada's energy province when oil and gas is on a roll - the fastest growing population in the nation, the highest incomes in Canada and the lowest tax burden. Alberta's hyped economy "accounts for a disproportionate amount of national activity," the economist determined. Even though Albertans only amount to 10% of the national population, our jacked economy makes up one-seventh of all economic activity in Canada.

It's little wonder that Albertans have a deep-felt resentment that we don't get any respect from eastern Liberal politicians - we're largely responsible for keeping Canada going.

If Egelton is halfway right, the best is yet to come. Oilsands production is expected to jump by 170% by 2015. To make that happen, the BMO guru predicts massive oilsands investment over the next 10 years.

"We believe spending has the scope to ramp up considerably," Egelton said. "To about $10 billion annually by the end of this decade."

Considering 2004 oilsands investment was $6.1 billion, that's quite a ramp-up.

While conventional oil production will decline by one-third (those old 1950s oilfields can only be squeezed for so long) natural gas production will remain flat. Which translates into massive exploration and development drilling to replenish reserves - including controversial coal-bed methane.

Labour markets will remain super tight; population growth will be 1.2% a year.

As a result "housing markets will remain vibrant."

And real estate board guys love vibrant.

It only gets better if you are a provincial politician. Egelton foresees "surpluses as far as the eye can see."

This year, the provincial surplus should have hit $8.7 billion if Ralphy hadn't gone on his pre-Christmas spending spree, plus hadn't given us prosperity dividends.

Next year, it will be $6.2 billion with no rebates. And on a status quo basis, the provincial government will still be banking $5 billion annual surpluses by 2015.

But it's not all wine and roses. There are risks out there too, the economist warned.

Because what Santa gives us, Santa can also take away. Namely low energy prices.

Back in the 1980s, when oil prices were scraping along at $16-US-a-barrel, Alberta's economy was the national underdog. Heck, we even got transfer payments one year.

"With production of conventional oil likely to decline," Egelton warned, "Alberta's economy will become increasingly reliant on production from oilsands."

But that deal's off when prices hit $25- to $30-US-a-barrel and recovery costs are more than revenues. There are the usual labour, pipeline capacity, infrastructure and environmental hassles that could also cook our golden goose.

"This could lead to a glut of residential and non-residential development in the province," Egelton cautioned.

Which is about the last thing the happy folk in the EREB's 142 Street bunker want to hear.

Strong Market Seen for Edmonton for Next Decade

So the Edmonton Sun just interviewed the new president of the Edmonton Real Estate Board (EREB) who assures us in this article that the market in Edmonton will stay strong for another decade. Let's hope she's right!

Ron Chalmers, The Edmonton JournalPublished: Thursday, January 05, 2006
EDMONTON - The Edmonton Real Estate Board's new president foresees a further decade of buoyant home prices.

"The Bank of Montreal sees 10 years of a strong Alberta economy," Madeline Sarafinchan said Wednesday. "That will definitely help the market."

Edmonton-area residential, commercial, and land sales, through the Multiple Listing Service, totalled a record $4.25 billion in 2005.

Sarafinchan estimated that 92 per cent of all homes are sold through the MLS -- with the balance sold by owners.

Home prices in the Edmonton area averaged $193,934 in 2005 -- up eight per cent from 2004.

During the last three months of 2005, prices averaged $197,945 for all homes -- and $225,709 for detached homes.

By sector, the year's highest average price for a detached home, $299,415, was realized in southwest Edmonton. The lowest average, $140,138, was in central Edmonton.

Even with recent increases, Edmonton prices remain only the 10th-highest in Canada.

Last year, 1,063 homes (including condominiums) sold here at prices under $100,00 -- compared to only 308 such sales in Calgary.

Meanwhile, only seven homes sold in Edmonton, and one in St. Albert, for more than $1 million each -- while 144 million-dollar-plus homes sold in Calgary.

The fastest sellers, Sarafinchan said, are homes with attractive kitchens and bathrooms. She said buyers also appreciate higher-quality materials such as hardwood floors and, in the kitchen, updated cabinets and granite countertops.

During 2005, 18,634 homes were sold through the MLS in the Edmonton area, including St. Albert, Sherwood Park, Fort Saskatchewan, Leduc, Spruce Grove, Stony Plain and Morinville. That was up from 17,652 in 2004.

Surging sales depleted the inventory. The number of active residential listings peaked at 4,810 in April, then declined every month to 2,894 in December -- far below the 3,854 active listings in December, 2004.

"New listings usually are low in November and December," said outgoing EREB president Jim Kulak. "We expect the situation to correct itself early in 2006."

Contact us for more info.
www.edmonton-homes.ca

Whitemud Drive and 17th Street Retail Complex

Residents don't want big-box stores for neighbours
CBC News

A commercial development in the city's southeast will bring too much traffic to the neighbourhood, residents complained at a community meeting Wednesday night.

The retail complex, at Whitemud Drive and 17th Street, will include a Home Depot, a Superstore and another big box store, along with a number of smaller outlets.

"You are going to hem us in with this development, without providing adequate roads to cope with it," Tom Hill, one of about 100 residents who attended the meeting, said. "It doesn't make any sense to anyone. I just do not understand why you would place us in that position."

City officials say the land at that intersection has been slated for a large retail development for 20 years, and that while they would like to widen the roads around the site there is no money available at the moment.

Monday, January 02, 2006

Alberta to Lead Economic Growth in '06

A report put out by BMO last week predicts that resource-based economies primarily in the west will do very well in 2006. They expect the economies of Alberta and BC to be even stonger in '06 than they were in '05. Newfoundland is expected to outpace Alberta and BC as major developments in the mining and oil sectors ramp up to full production.

"Alberta's growth will be boosted by rising oil production and the ramping up of construction on oil sands mega-projects," BMO chief economist Rick Egelton said in the release.

Overall, the BMO report said the country's GDP will rise by 3.5 per cent, an increase from the 2.9 per cent growth in each of 2004 and 2005.

BMO's chief economist is reluctant to declare the collapse of the housing boom, but says he expects housing starts will drop in 2006 and beyond "as pent-up demand is fulfilled and as interest rates rise over the medium term."

Egelton said the Bank of Canada is likely to continue raising its key overnight lending rate.

"We expect the overnight rate to reach four per cent by April, and 4.5 per cent by the fall of 2006," he said.

He expects the Canadian dollar to trade in a range of 86.4 cents to 87.0 cents US over the next year.

The full report is available on the BMO website: http://www.bmo.com/economic/regular/regional122005.pdf

Alberta Home Heating Costs to Soar in '06

The following article is from the CBC news...looks like our heating bills are going up... before the article, here are some tips to cut down your heating expense around the house: seal Leaks around doors and windows, look at room heaters instead of heating the whole home, use a programable thermostat to moderate your heating and wear warm clothes around the house.

The cost of heating your home in January is set rise sharply, with Direct Energy getting approval for rate increases of between 60 per cent and 80 per cent across the province.

The bump means an average customer in southern Alberta will pay another $100 next month, while northern customers will see an average increase of about $60.

The rates will increase to $15.60 a gigajoule in the south and $15.04 a gigajoule in the north. Direct Energy says the average home uses 23 gigajoules in January.

Bob Curran, spokesman for the Energy and Utilities Board, said the price increase reflects current market value.

"We don't really have the power even to deny a huge rate increase, because the market is driving those prices," he said. "So we're price takers as much as anyone else in this process."

Direct Energy spokeswoman Lisa Dornan says consumers only pay for the actual cost of the gas; there is no mark up.

She blames cold weather in parts of the mid-western U.S. and the eastern seaboard for increasing demand for the resource, forcing prices up.

Demand is still up from the aftermath of hurricane Katrina, Dornan added. And the company is recovering costs from December, when prices began to climb.

"The market prices were indeed higher than what had been forecast for the month of December and so Direct Energy actually recovered less money than what it paid to acquire the supply for Albertans," she said. "So part of the increase this month takes into account that."

Liberal energy critic Hugh MacDonald says he's already getting calls from angry homeowners. Any price for natural gas above $5.50 a gigajoule triggers the provincial rebate program, with the amount depending on the actual price.

For rates above $12, a flat rebate of $3.50 a gigajoule kicks in, plus each cent over $12, is matched by the province.