Interested in real estate trends? The WinnipegREALTORS 12th annual Forecast Breakfast on February 7 will discuss key issues from the past year while looking ahead to developments affecting the housing market in Winnipeg and the capital region.
This year’s Forecast Breakfast will impart significant take-aways concerning the local housing market and the real estate industry from a wide-ranging array of speakers and panels.
WinnipegREALTORS president Chris Dudeck will speak about how technology is shaping the economy and real estate transactions. As a REALTOR® adept at embracing technology as a valuable and productive tool to better serve his clients, he will convey his perspective about how he sees the real estate universe unfolding and how it affects the public and Realtors alike.
Commercial Division chair Trevor Clay, along with a panel of several key downtown and commercial stakeholders, will present an overview of the key commercial real estate sectors and the big developments of 2017 such as the closing of Sears and the start of construction on True North Square downtown. Please see the story on page 1 for additional information on this panel.
The keynote speaker this year is Will Dunning, economic consultant and chief economist of Mortgage Professionals Canada. Having analyzed housing markets since 1982, Dunning will clearly illustrate how different real estate markets are across the country.
Dunning will explain with an insider’s knowledge just how foreign Winnipeg’s house prices and stability are to a Torontonian. He will cover developments resulting from mortgage regulation changes and how those changes are impacting local markets differently.
WinnipegREALTORS MLS® market analyst Peter Squire will highlight key events from the past year while looking ahead to 2018 on a positive note based on occurances in the Winnipeg metropolitan region and the Manitoba economy. Along with Winnipeg’s unique market trends, the provincial economy is a significant factor driving local real estate activity.
Last year’s local market demonstrated its resilience despite tougher mortgage regulations. A new stress test on insured mortgages came into effect in 2016. It meant a buyer applying for a mortgage requires sufficient income to handle mortgage payments two percentage points higher than their negotiated rate. This meant a reduction in the price of the home they could qualify for, which could potentially take them out of the market altogether.
It also prevented some homeowners from listing a recently purchased home as they could no longer qualify to purchase a higher priced home based on the new regulations.
So what actually happened? Single family homes, the most expensive MLS® property type, did see a contraction in 2017, but only by 2 per cent, and that was in comparison to record sales performance in 2016. Not surprisingly, the lower end of the market was the most impacted. MLS® areas that were more dependent on first-time buyers who require insured mortgages to buy a home were the hardest hit.
Offsetting some of these decreases in 2017 were stronger move-up market sales, although they were constrained by less listing activity in neighbourhoods such as Linden Woods and River Heights.
One reason there were less listings in these established neighbourhoods, as WinnipegREALTORS past-president Blair Sonnichsen says, was the implementation of the city’s new impact fees on new homes. This resulted in a number of homeowners deciding to stay put instead of buying or building a new home.
This was demonstrated by a 25 per cent increase in 2017 over 2016 of residential renovations of $50,000 or more. The specter of the new impact fee forced homeowners to re-evaluate their plans, and deciding to renovate instead of listing their existing home.
2017 saw a significant gain in houses and condominiums sold for over $1 million. There were 45 homes sold in 2017 versus 30 in 2016, plus 6 condos sold, with none selling for this amount in 2016 or 2015.
Condo sales activity started the year off well and seemed to be the beneficiary of being an affordable alternative to the single family home, a trend noted in other major Canadian real estate markets.
However, their sales, in comparison to the record set in 2016, fell off in the second half of the year. In the end, condo sales for 2017 outpaced 2016 by nearly 3 per cent and were only a few sales off the record number sold in 2014.
The downtown really came to the fore in 2017 with a marked increase in sales activity. The construction of True North Square had a positive effect in instilling condo buyer confidence in living downtown. For example, a condo penthouse in 2017 sold on Waterfront Drive for $1,200,000.
What truly was more pronounced and significant in 2017 was the acceptance and success of some of the other MLS® property types which make up for less market share than single family homes and condominiums.
Single-attached properties finished the year up 12 per cent to easily surpass 500 sales and achieve its highest MLS® total property type market share of 4 per cent. Townhouse sales activity over 2016 increased 19 per cent, and commercial rose 8 per cent.
Another notable result in 2017 was the consistency of another total MLS® dollar volume record being set, which fell short of reaching a new benchmark by less than $80 million. WinnipegREALTORS market has demonstrated in prior years that, despite sales not always matching the previous year’s total, dollar volume always sets a new all-time high. Of course, this has to do with average price gains for a number of property types.
Unlike some other markets where there are marked percentage differences, Winnipeg’s are far more modest and subdued in comparison. In 2017, average price increases in both single family and condominium property types were in the low single digits.
Contact Val at vgeorge@winnipegrealtors.ca for information about this February 7 event. Tickets are $45 each.