The condominium lifestyle is taking off in Winnipeg, according to a new report by RE/MAX Canada.
The RE/ MAX Condominium Report 2007 indicated local condo sales so far this year are 21 per cent ahead of the pace set in 2006.
“Lifestyle, including the desire to be centrally located, immigration and demographics continue to be the main catalyst behind increased activity,” according to the report.
“We’re behind other Canadian centres in condo development, but there are more developments coming on-stream to meet the growing demand,” said WinnipegREALTORS® president Wes Schollenberg.
While condo sales this year only represent 10 per cent of all MLS® sales in Winnipeg, sales in centres such as Toronto, Edmonton, Calgary, Regina, Ottawa, and Hamilton-Burlington now represent 20 to 30 per cent of the total MLS® market. The RE/MAX report identified Greater Vancouver as the strongest market in the country where close to 60 per cent of all residential sales involve a condominium.
To meet the growing local demand, Canada Mortgage and Housing Corporation is forecasting 1,575 multiple-family starts in Winnipeg for 2007, a 20-year high.
“Given that about half of Winnipeg’s population is in the first-time buyer and move-up stage of homeownership, demand for condo units will remain strong for several years,” said Jeff Powell, CMHC’s senior market analyst.
RE/MAX said 44 per cent of condo sales were in the $100,000 to $150,000 price range, where “first-time buyers were the driving force.
“An additional 44 per cent of sales occurred at the $150,000 to $180,000 price point.
“With condo units priced as low as around $50,000, affordability remains a non-issue and homeownership remains an attainable goal for the vast majority of Winnipeggers.”
RE/MAX reported the southwest area of Winnipeg has been extremely popular so far this year for condo sales. The Osborne Village/Fort Rouge area has accounted for 13.5 per cent of all condo sales this year.
Also popular is the downtown, including the East and West Exchange and The Forks.
According to the report, empty-nesters and baby-boomers are fuelling the luxury condo market. As a result, upper-end condo prices are now surpassing $210,000.
To-date, sales of units priced at or above $210,000 have climbed 58 per cent to 288 units.
Last year, only 144 units were sold in this price range.
“The days of conservative spending in terms of the condominium market are long gone — the concept has proven itself to be a solid investment time and time again,” according to the report.
“In fact, the most expensive unit sold so far this year was a $1.25-million unit along the Assiniboine River.”
RE/MAX reported investors are snapping up new condominium construction. Some of these investors opt to rent or sublet apartment units and then sell the units at a profit down the road.
A number of condo projects coming on-stream are in highly coveted areas such as along Wellington Crescent or high-rises overlooking the Red and Assiniboine rivers. These units with a view start at approximately $250,000.
“Prices have not yet reached their ceiling and buyers should continue to expect further increases next year,” the report predicted. “Solid economic fundamentals and an aging population will result in strong 2008 sales figures, as the condominium lifestyle continues to gain a foothold in the city.”
To-date, the average condo price has risen by eight per cent this year to $165,000 when compared to a year ago.
Nationally, the report released by RE/MAX shows that 80 per cent of Canadian markets reported double-digit gains in sales year-over-year, with 53 per cent reporting increases over 20 per cent, including Winnipeg.
“The white picket fence, sprawling green lawn and tidy urban bungalow has become an unattainable ideal for many first-time buyers, especially in the West,” said Elton Ash, regional
executive vice-president for RE/MAX of Western Canada. “By necessity, condominiums have become the only practical means to homeownership for a growing segment of the population.
“Today’s entry-level purchasers aspire to manageable mortgage payments, sunset city views, and the non-stop action and amenities of central core living, all packed into 600 to 800 square feet. The momentum of the market in recent decades has redefined the home buying process,” he added.
New benchmarks for the most expensive apartment-style condominium units ever sold through MLS® have been reported in several cities in 2007, including Vancouver ($18 million), Calgary ($3.7 million), Edmonton ($2.3 million), Winnipeg ($1.25 million), and Kitchener-Waterloo ($670,000).