A significant increase in condominium sales has fuelled the highest ever monthly dollar volume gain at $412 million in May MLS® sales, reported WinnipegREALTORS®.
It is only the second time in the association’s 110-year history that a single month’s sales have topped $400 million.
According to the association’s month-end report for May, the 23 per cent increase in condominium sales over the same month in 2013 was the result of more existing units coming on-line and new units coming onto the marketplace.
There was also a nine per cent improvement in condominium sales in the first five months of this year when compared to the same period in 2012.
“We can be thankful for more affordable condominium sales alleviating some of the fall off in residential-detached or single-family home sales,” said WinnipegREALTORS® president Richard Dettman.
He said the inventory of condominiums was up 31 per cent going into May and maintained a 27 per cent gain to the end of the month over May 2012.
“Affordable listings were clearly evident,” he added, “with 40 per cent of all condo sales happening in the $150,000 to $199,999 price range.”
While condo sales were up, May MLS® sales were down overall by three per cent to 1,550 units when compared to May last year.
But MLS® sales for the first five months of the year were actually five per cent ahead of the 10-year average and were the fourth best ever recorded for the month of May.
“The tale of the two property types is well at play this year,” said Dettman, “with condominium sales almost the exact reverse of single-family homes. “The latter are down 10 per cent.”
WinnipegREALTORS® has joined the Canadian Real Estate Association in continuing to warn Finance Minister Jim Flaherty that his decision to lower the minimum amortization from 30 years to 25 years on Canada Mortgage and Housing Coporation (CMHC)-insured mortgages could have a detrimental effect on the Canadian economy.
It has already been observed that fewer first-time buyers are in a financial position to purchase a home.
In Manitoba, WinnipegREALTORS® is calling upon the provincial government to reform its land transfer tax, which adds significantly to costs of purchasing a home for first-time buyers. In the case of a $250,000 home, the cost of the land transfer tax is $2,720, and it must be paid before title is transferred to the purchaser.
“All levels of government need to be mindful of the actions they take to facilitate or inhibit one of the most important economic engines in the country,” said Dettman.
When combined with the results for April, Dettman said May sales indicated the start of a recovery after a poor first quarter this year.
“Our better second quarter MLS® sales results is so far bringing us back to a year more in line with what we expected,” he added. “This improvement bodes well for June.”
Year-to-date MLS® sales are down nine per cent to 4,951 units, while dollar volume sales have decreased four per cent to $1.28 billion, when compared to the same period last year.
MLS® inventory available on the market is healthy with a 14 per cent last month in new listings from May 2012. Total listings at the end of the month also increased by 14 per cent.
Meanwhile, CMHC reported a slight decrease in housing starts in Winnipeg and the surrounding municipalities from 4,194 units in April to 4,077 units in May.
“The trend in total housing starts declined slightly in May due to a moderation in multiple-family construction,” said Dianne Himbeault, CMHC’s senior analyst in Manitoba.
“While multiple-family starts moved lower in May, the pace of single-detached construction has been trending higher since March of this year,” she added.
Last month, there were 255 single-detached homes under construction, which was five more than the previous month.
WinnipegREALTORS® reported that the most active resale residential detached price range in May was between $250,000 and $299,999, which accounted for 24 per cent of such sales. While the $150,000 to $199,999 condo price range accounted for most of May’s condo sales, the $200,000 to $249,999 price was a distant second with 18 per cent of total sales.