It would be naive to expect the local real estate market will forever establish new MLS® records similar to those set in June, but for now Winnipeg’s highly-diversified economy is performing well and real estate remains quite affordable when compared to other major markets across the country.
For example in Calgary, residential-detached home sales begin at over $300,000 — there are virtually none under $200,000 and only five per cent between $200,000 to $299,999. On the other hand, nearly half of all residential-detached sales are under $200,000 in Winnipeg. And approximately 75 per cent of condominium sales in Winnipeg are under $200,000, while in Calgary this price range accounted for only three per cent of total condo sales.
In next-door Saskatoon, home prices have skyrocketed over the last few years, contributing to an average residential sale price in June 2008 of $310,000. Regina’s prices have also gone up rapidly with its average residential sale price reaching $242,091. Vancouver’s residential-detached average price in June was $765,000.
Due to its affordable housing and high demand, Winnipeg will have another outstanding year with sales volume eclipsing $2 billion (already $1.3 billion with six months to go) for the second year in a row and sales are within reach of last year’s all-time high: as of the end of June, MLS® sales were less than two per cent off last year’s record pace.
Gregory Klump, the Canadian Real Estate Association’s chief economist, said this week that Winnipeg and St John’s, Newfoundland, are the two stand-out housing markets in Canada.
Heading into July, there are 28 per cent more listings available for sale than was the case last year. It is not enough to create a completely balanced market, but certainly helps bring some relief to buyers .
Despite the increase in new listings, homes continued to be sold at or above the MLS® list price. In June 2008, one out of every two homes sold for above list price and two out of every three sold at or above list price.
Heino Molls, publisher of Real Estate Magazine, wrote the following commentary, outlining the North American housing market in relation to the world real estate market.
“Although we are hearing some gloom about the economy in America, there is much economic development around the world. There are some remarkable things happening across the oceans.
“India is rolling out a new cricket league with hype similar to the glitz of NFL football. They even imported cheerleaders from the Washington Redskins to promote the opening game of the season. This is happening because entrepreneurs are discovering what home builders in India knew years ago. The new-found wealth created by India’s robust economy is presenting all kinds of opportunities for making money.
“Oil is certainly more expensive, but not because there is less of it. It is because of more demand in China. The economy is booming in China, as well as India. Both nations are manufacturing cars and other goods that are beyond the usual trinkets we once associated with them. Along the way, property and housing have become more important when accounting for personal wealth. Yes, there is a real estate industry in China.
“These two countries alone count their people in the billions.
“In Dubai, the crossroads of economic wealth between Europe and Asia, spectacular buildings are being erected ... out in the ocean on manmade islands with magnificent shapes that can be seen from space. There are huge indoor malls and many more are being built. There is even an indoor ski slope with artificial snow and temperature at -2°C to accommodate winter fun and sports. Can you imagine that? A ski slope in the midst of a desert country!
“While not as robust as developing countries and their markets, the united countries of Europe are presenting the leading edge in development of environmental alternatives and manufacturing from recycled goods and services. These are costly ventures but the people support these initiatives enthusiastically. The technologies of wind power, solar energy and recycled products of every description are beginning to accelerate in value, both in sales and savings.
“The economy is chugging along nicely even in Russia. There are a lot of folk with incomes today who did not have one before. They are buying homes and they are pretty pleased about it.
“But don’t forget for one minute about the one place they all wished they lived. The No. 1 place for them is North America.
“At the end of the day, if any of these folks in all these hustling economies had the chance to live here, they would come over in a New York minute.
“North America is the greatest market for all goods and services. Period. It is the judge and jury of what is cool and hip in the world. It is the in place. It is the only place to be. It is a place where freedom is almost unlimited. Human rights are rock solid. Opportunity is everywhere. Chances are dealt out like playing cards on every street corner.
“In Canada, America’s shadow next door, all these things are at our daily disposal and more. On top of everything else we have mountains, ocean fronts, clean water, forests, vast tracks of land and more services at our doorstep than anyone can possibly imagine. We have more of everything than any other country in the world.
“It is no wonder that anyone, anywhere in the world, anytime would drop everything they were doing for a chance to live here. Including the chi-chi-rich folks.
“The real estate market in America and Canada will be as robust as it ever was, house values will rise and the market will be even more active.
His advice to agents and consumers: “Beg, borrow, figure, fiddle, scrape, save but for crying out loud get out there and buy a house! It’s the best investment you will ever make.”