By Peter Squire
In the Canadian Real Estate Association’s (CREA) current television commercial, it conveys in a very professional manner what the meaning of buying a home is all about. The emotional impact of realizing that goal is palpable. Called “Welcome Home”, CREA talks about how a REALTOR® knows what you are looking for beyond four walls and a roof over your head.
The opening line is “a REALTOR® knows this is not just a place to live in, it’s a place to grow in.” The follow-up to this opener is “this is not just a spacious floor plan, it’s a space where you can plan your future.” And it then makes a very strong statement and connection to ownership by stating, “A REALTOR® will not just help you buy a house, they will find you a home.”
While this commercial taps into what the knowledge, dedication and expertise of a REALTOR® can do to help any buyer — including a first-time buyer — purchase a home, it is not meant to be a simple snapshot of the current housing market across the country, with all its diversity.
Upon reading CREA’s monthly market release, there is usually a statement from the chair of this 114,000-member association where they want to bring it back to a local context to reflect how markets behave differently. September is a good example of this.
“September provided another month’s worth of evidence from all across Canada that housing market conditions are stabilizing near current levels,” said Cliff Stevenson, Chair of CREA. “In some ways, that comes as a relief given the volatility of the last year-and-a-half, but the issue is that demand/supply conditions are stabilizing in a place that very few people are happy about. There is still a lot of demand chasing an increasingly scarce number of listings, so this market remains very challenging. That’s why your best bet is to consult with your local REALTOR® for information and guidance about navigating the current market.”
This same market release shares how different markets across the country are faring this year, with price increases varying greatly and starting at levels much higher than in our local market.
Looking across the country, year-over-year price growth is creeping up above 20% in B.C., though it is lower in Vancouver, on par with the provincial number in Victoria, and higher in other parts of the province.
Year-over-year price gains are in the mid-to-high single digits in Alberta and Saskatchewan, while gains are into the low double-digits in Manitoba.
Ontario saw year-over-year price growth pushing 25% in September. However, as with big, medium and smaller city trends, gains are notably lower in the GTA and Ottawa, around the provincial average in Oakville-Milton, Hamilton-Burlington and Guelph, but considerably higher in many of the smaller markets around the province.
Greater Montreal’s year-over-year price growth remains at a little over 20%, while Quebec City is now at 13%. Price growth is running a little above 30% in New Brunswick (higher in Greater Moncton, a little lower in Fredericton and Saint John), while Newfoundland and Labrador is now at 12% year-over-year (a bit lower in St. John’s).
In the Royal LePage House Price Survey released this month, the aggregate price of a home in Canada has risen 21.4% from the same time last year to $749,800 in the third quarter and is forecast to finish year end at $771,500. In sharp contrast, our regional market had an MLS® single-family average sales price at the end of the third quarter at half the national price. It was $374,777, to be exact, and still tracking this same price level in the first 15 days of October at just under $376,000.
Applying the MLS® Home Price Index (HPI) to the typical single -family benchmark-priced home in the Winnipeg Regional Real Estate Board market in September shows it can be purchased for less than this average at $333,100. Then there are alternatives as well, especially for first-time buyers who do not have the benefit of bringing equity from selling their property to put towards another home.
The Winnipeg Regional Real Estate Board’s 2021 president, Kourosh Doustshenas, pointed this out in a recent Winnipeg Free Press article by business reporter Martin Cash, that “the re-emergence of healthier sales of condominiums has been welcomed.” Yes, indeed it has, with an increase of condominium sales for the first 9 months in 2021 of 49% which are continuing to outperform 2020 sales in October. The MLS® HPI benchmark price for apartment condominiums in September is an affordable $206,300. It’s also important to note the most active price range for condominiums in 2021 is from $150,000 to $199,999, and going into October, there are 130 or nearly one-in-four active condominium listings available for sale in this price range.
Not only have condominiums proven to be an attractive alternative this year to single-family homes, but there are more of them relative to demand in comparison to single-family homes. A metric bearing this out is the fact that year-to-date single-family home sales saw nearly half sell for above list price, whereas condominium sales saw far less at 15%.
So while you read articles in national publications like the Financial Post which speak of out of reach home prices, the reality is all real estate markets are local. With historical low mortgage rates and the federal government looking to help first-time buyers get a foothold in the ownership market, you owe it to yourself to talk to a REALTOR®, one with local market expertise who can advise you on just what may be possible for your home buying aspirations. That home or condo you have in mind may not be that out of reach!
Peter Squire is the Winnipeg Regional Real Estate Board’s Vice-President, External Relations & Market