Condominiums proving to be a very affordable housing option

By Peter Squire

The first major development in 2021 is the remarkable record-setting condo sales activity. The Winnipeg Regional Real Estate Board (WRREB) has never before reached anywhere close to the sales numbers it is achieving so quickly. In the first six months of this year, there have been 1,376 sales, a 94% increase over the same period last year. Up until this year, the most condo sales in the first six months had been 963 in 2014.

The game-changer is not the number of condo listings coming on the market. This total has consistently been over 2,000 (with the exception of last year due to the pandemic economic shutdown in April and May). The real story is the conversion of those 2,000 listings to sales. Instead of a typical 40% turnover rate in the last 5 years, increased demand for condos has spurred this percentage upward to 66%.

No better MLS® area to exemplify the vast improvement in converting condo listings this year is Sage Creek with a percentage of 114%. How do you get 25 sales when you have just had 22 new condo listings entered in 2021? Simply because there were 3 listings entered in 2020 that carried over into this year. Another MLS® area which sold out all of its 21 listings is the Crescentwood MLS® area west of Stafford Street and south of Grosvenor Avenue.

Other MLS® areas worth noting when it comes to selling out their condo inventory are Canterbury Park, East St. Paul, Garden City, St. James, Crestview, West Charleswood south of Roblin Blvd., St. Vital south of Bishop Grandin between St. Mary’s Road and St. Anne’s Road, the RM of Ritchot, the lake country MLS® area which runs along the west side of Lake Winnipeg (e.g. Gimli), and Morden/Winkler.

In the month of June, Richmond West also experienced exceptionally strong demand with more sales than listings available at month end — 14 versus 11.

As for prices, the average condo sale price has firmed up after barely nudging in 2020 to end up at $240,000. After six months in 2021, that average price now sits at over $244,000. This is a very modest rise of less than 2%. In comparison, the average single-family home has vaulted nearly 12% to $381,000 from its 2020 average sales price of $341,000.

In terms of percentage market share activity, the breakdown of most active price range sales activity for condos from January 1 to June 30, 2021 is as follows: $100,000-$149,999 — 14%; $150,000-$199,999 — 25%; $200,000-$249,999 — 18%; $250,000-$299,999 — 15%; $300,000-$349,999 — 12%.

Cumulatively, this shows that 84% of all condo sales within the Winnipeg Regional Real Estate Board market region occur between the prices of $100,000 and $349,999. The remaining 16% of sales was made up mostly by the next two higher price ranges from $350,000 to $449,999. There were three sales over $1 million — with the highest selling for $1,612,005. The $150,000 to $199,999 has remained the most active price range for many years and even in 2021 represents one out of every four sales.

The busiest MLS® area by far for condo sales is Osborne Village at 126 sales. Tied for second at 60 sales are Crestview and River Park South, with Waverley West third at 56 sales. Downtown Winnipeg is close behind at 55 sales.

The pie charts above reinforce the point that condos are a very affordable alternative to the single-family home, especially for first-time buyers who enter the market without having any equity established through prior property ownership.

The price range breakdown shown in the chart for single-family homes reveals a major contrast to the condo market. The most active price range for a house is from $500,000 to $749,999 at 16% and then you have both the $300,000 to $349,999 and $350,000 to $399,999 price ranges being the next most active at 14% each. Only 6% of single-family home sales happen in the busiest condo price range of $150,000 to $199,999 — and higher end sales are clearly the domain of homes with nearly one in five selling for prices above $500,000. There were 47 sales for over $1 million with the highest selling for $2,750,000.Houses have also generated more above list price sales — at 54% — while condos are considerably less at 15%.

The average square footage for house sales was 1,369 sq. ft. while for condos it was 1,037. The average continuous days on market to sell a house was 23 while condos averaged 44 days.

Going into the second half of 2021, there are 582 available condo listings for sale with 151 of them in the $150,000 to $199,999 price range, and another 117 in the next highest price range of $200,000 to $249,999. The vast majority of condo listings are in more affordable price ranges with only 32 listed above $500,000.

Based on the unprecedented level of activity in the first half of this year there is no reason not to expect brisk sales to continue into the third quarter. Condos are proving to be a very good affordable housing option in our local real estate market.

Peter Squire is the Winnipeg Regional Real Estate Board’s Vice-President, External Relations & Market