Friday, September 11, 2009


Greetings all, hope you're all ready for the weekend. My apologies for the lack of updates, it's been a crazy week, but I'm sure you don't care... so, I'm gonna try to fire of a quick write-up before I head off to the football game (here's hoping it's not as bad as Mondays!).

Anyway, a while back CM, one of our regular readers from made a comment I liked over on Mike Fotiou's blog. He listed off a half dozen or so economic indicators for Alberta real estate he liked to follow that I think are very good. For an even more complete list you can visit CM's site where he lists over a dozen, as well as links to many other sites of interest for those who follow real estate.

So today I figured I'd list some of the ones he follows, as well as some I follow, and some we've even discussed here before. So if you are so inclined you can check them out, and decide for yourself if/how you feel they influence the real estate market and the economy here in Wild Rose Country.

  • Employment - It would stand to reason the more people working, the more likely they are to be buying real estate, and just spending money in general. I particularly like to follow full time employment numbers. I think that gives you the best sense of what's happening in the trenches.

  • Consumer Debt - As you guys know, I harp on mortgage arrears endlessly... and arrears are closely tied to foreclosures. Some dismiss these as trivial, but I think they give an impression of overall market health, and if increasing numbers of people are falling behind on their largest monthly expenditure, I find that troubling. It's also good to keep an eye on the levels of household debt, and credit card delinquencies.

  • Commodities - As we've discussed here in recent weeks, oil, and particularely natural gas revenues are a very big part of the Alberta economy. Not just in direct government royalties, but jobs and incomes directly and indirectly tied to production. When prices are up, production goes up, which means not just more jobs in the oil patch, but those people are spending that money too, which creates a massive spin-off effect. Conversely, when things tighten up like it has lately, the entire economy feels that too.

  • Interest Rates - These are a biggie as they are such a big influence on affordability... and what drives interest rates are bond yields. As Canada is something of a minnow on the global financial markets, our bonds tend to just go with the flow so it's easiest just to follow US bonds. CM likes to follow the 10-year bonds, I like the 5-year... basically same shit, different pile, they pretty much follow the same pattern, just shifted.

  • Real Estate Prices - And all those others lead up here. While certainly a lagging indicator, ultimately these are where the buck stops. Many different dimensions to look at, resale prices (which we discuss ad nauseam here), home price index, new home price index.
Hope you find those interesting, and if you have some more or your own feel free to list those in the comment section. Sorry this is a bit of a short one, but I'm tired, it's Friday, and I want to watch some football and maybe drink an overpriced beer... or twelve. Have a good weekend!