CONDO SALES PROPEL AUGUST TO A RECORD MONTH

WINNIPEG - A record month of sales and dollar volume activity for August capped off a very active summer. July and August were identical twins when it came to sales. However dollar volume differed with lower dollar volume in August due in part to condominium sales activity showing much larger gains than single family.

August MLS® sales of 1,439 were up 13% over August 2018 and rose 9% above the five-year average for this month. The highest previous month of sales activity for August was 1,350 sales in 2016. August dollar volume of $411 million resulted in close to a 10% gain over the same month last year. It is the first time August dollar volume has eclipsed the $400 million mark.

The real highlight of August 2019 was the 37% increase in condominium sales over August 2018. The 199 sales are 19% higher than the five-year average for this month and a few sales below the best condo month sales performances ever for the Winnipeg Metro Region.

With the exception of 9 new condo sales in a Fort Rouge project, the vast majority of condo sales in August were resales with many of the larger percentage gains over 2018 occurring in the southwest quadrant of Winnipeg. When you add up the August condo sales activity of East Fort Garry, Linden Woods and Fort Richmond, there are 34 sales. There were 12 altogether last August.

As for single family sales, the 1,014 total for this month are record-setting too for this month but only up 4% over August 2018. 3% of these sales can be attributed to the expansion of MLS® this year to the south-central region of Manitoba in the Morden/Winkler area. Another 25% of total single family sales came from outside Winnipeg.

“It is not often, if at all, when we see condominium sales outperform single family to the degree they did this month,” said Ken Clark, president of WinnipegREALTORS®. He added, “It means their year-to-date percentage gain over 2018 sales is greater than single family’s now."

If condominiums were the lead standout in this record-performing MLS® month, there was a strong supporting cast of other property types besides single family. All property types saw increases over August 2018 with large double-digit increases in many instances. The 27 resort property sales increased 50% over 2018. 

Year-to-date MLS® sales of 9,702 are 5% higher than the same period of time last year while dollar volume of $2.91 billion is up 6% from 2018. Sales are within 1% of the best years on record in 2016 and 2017.

Inventory is somewhat elevated at over 6,000 listings and is 17% greater than we were at the same time last year, however overall we remain in balanced territory.

“It is becoming abundantly clear with the strong results we had in August that buyers are capitalizing on the incredible choice and vast array of affordably-priced properties available on our MLS® for sale,” said Clark. “A very favourable 5-year fixed rate in the current mortgage market bodes well for buyers heading into the fall season.”

“In a competitive market where there are so many listings to choose from, you need to hire a REALTOR® to make your property stand out and come up with the right strategy to sell your home,” said Marina R. James. “REALTORS® have the knowledge, expertise and tools to sell your listing.”

 
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Jim Born
WINNIPEG REALTORS® SETS DOLLAR VOLUME RECORD IN MONTH OF JULY

WINNIPEG - The Winnipeg Metro Region market heated up in terms of dollar volume with a new record set for July with $437 million representing a 10% increase over July 2018. Sales of 1,440 trended upward with nearly a 5% rise over last July and only 3% shy of the best July on record in 2014.

Year-to-date sales activity of 8,263 sales shows a 4% gain over the same period last year while dollar volume of close to $2.5 billion is up more than 5% in comparison to 2018. This is the highest dollar volume reached for WinnipegREALTORS® in the first 7 months of 2019.

Helping explain the higher percentage increase in dollar volume this July are some notable increases in sales in some of the higher price ranges in condominiums and to a lesser extent, single family homes. For example, in condominiums, there were 20 sales compared to 10 last July in the $275,000 to $299,999 price range. There were 9 sales compared to 3 last July in the $375,000 to $399,999 price range and twice as many sales over $600,000 this year with one selling for $1 million. A good example in single family homes with 60 sales in the $400,000 to $424,999 price range compared to 34 in 2018 in this same price range.

One of the results of having higher-priced condominium sales the last few months is the average year-to-date sale price drawing even with 2018 at $240,000. The single family home year-to- date average sales price of $328,718 is up less than 2% compared to the same period last year. 

Listings continue to exhibit strong increases on a monthly basis over last year with over a 10% jump in new listings coming on the market in July or a 15% growth in inventory with 6,083 listings available for sale going into August.

“The strong numbers in both sales, dollar volume and listings in July is a reflection of buyers taking advantage of lower mortgage rates, a fabulous choice of an abundant supply of listings, and some very attractive affordable housing options beyond just single family homes and condominiums,” said Ken Clark, president of WinnipegREALTORS®. ‘”It is also worth noting, in July the Bank of Canada lowered the rate used by the mortgage stress test to qualify for a mortgage from 5.34 per cent to 5.19 per cent.”

And in addition to single family homes and condominiums which offer alternative housing choices for buyers, the attached housing category performed very well in July with over 100 sales with an average sale price of just under $257,000.

The most active of the attached property type category, which includes duplexes, townhouses and single-attached, was the latter one with 72 sales – a 22% increases over the same month last year. Year-to-date nearly 400 single-attached properties have been sold and increased 22% over the same period last year.

Single-attached is the third busiest property type with 5% of total MLS® market share. Leading the way after seven months is single family homes with close to 73% and then condominiums with a 12% market share.

“We have reason to be optimistic of achieving a good MLS® result in August given the positive trend over 2018 and the wide array and diversity of listings on the market,” said Clark. “All provincial election volunteers on the campaign trail will certainly notice all of our MLS® listings available for sale.”

“Get out and take advantage of our spectacular summer weather to see all of our listings for sale throughout the Winnipeg Metro Region,” said Marina R. James, CEO of WinnipegREALTORS®. “Our REALTORS® know the local market and will apply their skills and abilities to help find the right home for you.”

 
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Jim Born
JUNE SALES JUST SHY OF LAST JUNE'S MARKET ACTIVITY

WINNIPEG - June sales of 1,528 fell short of June 2018 market activity by 1% and 3% from the 5-year average for this month. What really stood out in June is extensive inventory which offers buyers record levels of choice in one of the most affordable housing markets in the country.

June dollar volume of nearly $463 million declined 2% from June 2018 yet is equal to the 5-year June average. New listings are strong again in June with 2,698 entered on the MLS®, an 8% increase over June 2018. Current inventory going into summer is approaching 6,000 listings, 14% higher than 2018.

“Despite a slight decline in June sales activity the record -setting May helped propel second quarter results to match the 5-year average,” said Ken Clark, president of WinnipegREALTORS®. “This year’s second quarter is just 4% behind our best quarter on record in 2016.”

In terms of June single family home sales activity, sales were neck and neck between the two most active price ranges of $250,000 to $299,999 and the $300,000 to $349,999. Together they represent 35% of total sales. If you add the two next similarly paced price ranges of $200,000 to $249,999 and $350,000 to $399,999 you reach 60% total sales activity. Condominium sales were most active in the $150,000 to $199,999 at 29%. The next most active price range was from $200,000 to $249,999 at 19%.

“It is important to keep in mind that sales activity varies between different price ranges and drops off significantly as you climb up the price ladder,” said Clark. “In June the price ranges from $500,000 and above made up just 10% of total single family home sales."

Year-to-date sales of 6,823 are up nearly 4% over the first six months of 2018. The only two years they trail are the record-setting years of 2016 and 2017 where both had over 7,000 sales at this time. Dollar volume after six months is over $2 billion and slightly lower than the highest total recorded in 2017 and nearly ahead by 5% over 2018.

“A true sign of a strong market is when the sales and dollar volume increase at a reasonable but steady pace, and the first 6 months of 2019 certainly make that evident”, said Clark.

At the end of the first half of every year WinnipegREALTORS® likes to see how average single family home prices are tracking in the 5 MLS® zones within Winnipeg and the rural zone encompassing the market region outside Winnipeg. As you can see from the chart below, all zones show prices are slightly ahead or even with last year with the exception of the North zone which is down by a small margin.

The highest average priced MLS® zone is the Southwest at $435,430 while the lowest are the North and West zones at $263,117 and $263,852 respectively. The overall average single family sales price is $329,841, a very modest gain over the $325,314 recorded for first six months in 2018.

“A healthy supply of listings is keeping our house prices in check and very affordable,” said Clark.

The June 2019 RBC Housing Trends and Affordability Report highlights Winnipeg as being just above its long-term average level of affordability since 1985. It comments that “slow-rising prices keep ownership costs very manageable".

Looking ahead to the second half of 2019, CREA revised its 2019 forecast to indicate a recovery in home sales is underway across a number of market regions. This is certainly the case in the Winnipeg Metro Region with sales improving over 2018. CREA is calling for an increase in sales of over 4% for Manitoba.

“Not every market is the same nor house within a market,” said Marina R. James, CEO of WinnipegREALTORS®. “There are many factors at play so you need to be calling a professional REALTOR® - a market expert – to help you meet your home buying and home selling needs.”

 
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Jim Born
MAY SET ALL-TIME MONTHLY RECORD WITH OVER 1,700 SALES

WINNIPEG - May sales of 1,705 is the first time WinnipegREALTORS® has reached and eclipsed the 1,700 threshold mark for any month including May. It also broke new ground for any month with sales dollar volume vaulting over one-half billion to $526 million. The previous record set in May 2017 just fell short of the half billion dollar mark at $499.4 million while sales were only 4 below 1,700.

In relation to the same month last year, sales rose 13% while dollar volume increased 15%. New listings were impressive too with over 3,000 entered on the MLS® in May – a 7% increase compared to May 2017. This leaves 5,689 listings available for sale in June.

“These records are a true testament to a real team effort by our 1,890 REALTOR® members who cooperate every day to serve buyers and sellers in our local market,” said Ken Clark, president of WinnipegREALTORS®.  “It shows how our market region extends well beyond Winnipeg to encompass southeastern Manitoba”. 

What are referred to as rural sales or those outside city of Winnipeg boundaries were the difference maker from the previous record May 2017. Their percentage of total single family sales went from 24% to 29%. Deserving special mention is WinnipegREALTORS® R35 MLS® area which is called South Central Plains and includes the cities of Winkler and Morden. Owing to having REALTORS® in this area join the association this year and list their properties on our MLS® system, property sales went from 8 in May 2018 to 64 this May.

“We are absolutely delighted to have more rural members joining and participating on our MLS®, “said Clark. “ Like other major cities in Canada our market region has always reached out to rural municipalities and cottage country.”

The record month of May boosted year-to-date sales to 5,295, a 5% increase over the same period in 2018. Dollar volume closed in on nearly $1.6 billion worth of sales resulting in a 7% increase. The over 11,000 listings entered on MLS® for the first five months this year shows a 6% increase over 2018.

On a real positive note, all MLS® property types performed better in May 2019 than May 2018 with town house and single attached properties sales both up 40% over the same month last year. All percentage increases were in the double-digits with the exception of vacant land and duplexes.

Even with the strong influx of new MLS® listings in May the high absorption rate of listings being converted to sales leaves 3.3 months of inventory remaining for June. This result biases overall market towards more of a sellers’ market however it really does vary according to MLS® areas and property type.

Some MLS® areas where single family home listing inventory clearly needed to be replenished based on May sales were River Heights, Crescentwood, Charleswood, Waverley Heights, Whyte Ridge, St. Norbert, St. Boniface, St. Vital, Windsor Park, East Kildonan, North Kildonan, Sun Valley, West Transcona, Canterbury Park, Garden City, Tyndall Park, Maples, St. James and Westwood.

For condominiums it is a far different situation with more inventory available based on current demand.

Affordability continues to be a strength of the local real estate market with nearly half of single family homes selling for under $300,000 and 74% of condos selling below this price.

“Winnipeg and the surrounding rural MLS® areas offer some of the most affordable housing in the country,” said Clark. “Buyers are availing themselves of this great opportunity.”

“In a record month such as we just completed our REALTORS® really came to the forefront in executing all of the necessary legwork and details to finalize a successful sale,” said Marina R. James, CEO of WinnipegREALTORS®.

 
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Jim Born
APRIL MLS® SALES SLIP BACK MODESTLY FROM APRIL 2018

WINNIPEG - While Manitobans welcomed spring with open arms given a long winter they also were relieved to know potential flooding threats did not come to fruition. Thanks to major engineering flood mitigating projects such as The Winnipeg Floodway or Duff’s Ditch, as it is commonly referred to as, thousands of properties have been saved over many years from the ravages of water damage.

April sales of 1,223 were down less than 5% from April 2018 while dollar volume decreased 3%. It is a 60 sales difference from 2018.

Single family dwellings and condominiums remain close to last year’s results with six fewer sales in single family and eight in condominiums.

2,711 new listings were added to the market in April to create a healthy supply of nearly 5,000 listings available for sale in May. Current inventory sits at 4 months of supply. This is considered balanced from an overall market perspective.

“The strong influx of new listings this year bodes well for an uptick in increased sales as we head into our busiest months of the year,” said Ken Clark, president of WinnipegREALTORS®. “The wide choice and affordable options available for buyers will help make this a reality.”

Year-to-date sales are up 2% while dollar volume is 3% higher with over $1 billion worth of sales activity. Listings entered for the year are tracking 5% ahead of last year for the first four months.

The average sales price for single family homes or residential-detached in April was $332,185. Helping raise the average sale price up to this level were 7 sales over $1 million including one for $2,100,000 in Tuxedo. The condominium average sale price as well saw it rise well above its previous month average to $248,284. There were some higher priced sales of which one went for just under $1 million on Waterfront Drive.

The most active price ranges in percentage terms of total sales for single family homes in April where from $200,000 to $399,999. The $250,000 to $299,999 price range realized the most sales at 18% of all sales.

For condominiums, the $250,000 to $299,999 price range was just edged out by the $150,000 to $199,999 price range. The latter represented 25% of total sales with the former having 23%.

In April the Bank of Canada maintained the overnight lending rate at 1.75%. This did not come as a surprise as many economists state we will not see a rate increase in 2019 due to uncertainty around trade including ratification of the Canada-United States- Mexico Agreement. Even an interest rate cut may be a possibility.

The Bank of Canada Governor Stephen Poloz spoke to the April monetary policy report and in addressing the housing market he said markets such as Halifax, Montreal, Ottawa and Winnipeg are seeing solid activity. 

It is interesting to note Governor Poloz was in Winnipeg on May 6, 2019 as part of the Canadian Credit Union Association national conference. The Winnipeg Chamber of Commerce hosted a luncheon featuring a conversation with him. 

“I appreciate the governor expressing a vote of confidence in our housing market,” said Clark. “We know Winnipeg’s market is a resilient and steady one and should continue to perform well this year.”

“Keeping a close pulse on any changes to the housing market is what REALTORS® do,” said Marina R. James, CEO of WinnipegREALTORS®. “If you are selling or buying, your REALTOR® is one call, email or text away.”

 
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Jim Born
FIRST QUARTER SALES UP 6% OVER 2018

WINNIPEG – Spring is a time of optimism, when we cast off winter’s gloomy grip and walk cheerfully into the warm sunshine. This renewal of energy is apparently being reflected in local housing sales for the beginning of 2019 in the Winnipeg METRO Region.

First quarter sales are off to a good start. The 2,367 sales transacted in the first three months show a 6% increase over the same period in 2018, and only a 3% dip from the record-setting years of 2016 and 2017. Similar to sales, there is a 6% rise in year-to-date listings with more than 5,400 entered on the MLS®. Dollar volume of close to $700 million is up 7% from 2018.

March sales of 1,009 resulted in nearly a 4% gain in comparison to March 2018, while dollar volume of just under $300 million edged out last March by less than 3%. The 4,212 active listings sitting in inventory at the end of March are 8% higher than they were at the same time last year.

 “The solid first quarter sales activity is a positive momentum builder going into the busier spring market,” said Kenneth Clark, president of WinnipegREALTORS®. “No interest rate hikes are on the horizon, and buyers know PST relief is coming July 1 with all of the ancillary purchases that go with the purchase of a home.”

March single-family home sales activity was most active in the $300,000 to $349,999 price range and therefore supplanted the next lower price range of $250,000 to $299,999. March 2018 was the exact opposite and by a 45 sales margin. Now more than one in two single-family home sales occur over $300,000. It will be interesting to see if this will become the norm as the year progresses.

The shift in sales activity to higher price ranges is a gradual process in a stable market such as Winnipeg’s. Of note in March - when you compare it to last March - are the rural MLS® areas as a whole, which represented 26% of total single-family home sales, and saw its average sale price increase from $315,595 to $323,873. The northeast area of Winnipeg also saw a small bump up in its average sale price to $289,857, and a 17% increase in sales activity. These two developments alone help explain the upward movement in sales activity.

Condominiums sales were virtually the same as March 2018 with price range activity nearly a repeat of last year with percentage of sales under $300,000 being at 87% and 86% respectively. The most active price range was from $150,000 to $199,999 though this March captured 35% of total condo sales while March 2018 was less at 27%, owing to more activity in the lower price range from $100,000 to $149,999.

The average single family home sales price in March was $326,433, whereas the condominium average sale price recorded was $227,538.

“All markets are local and vary within, as illustrated by the difference in property type price range activity such as in single-family homes and condominiums,” said Clark. “The strength of our market is the many affordable choices and options available to buyers, and that will continue in 2019.”

Speaking of affordability, RBC’s March 2019 Housing Trends and Affordability Report shows that in both Saskatoon and Winnipeg you are better off owning an average-priced condo apartment than renting a two-bedroom apartment. 

The report also indicates Winnipeg’s market is very close to its long-term average aggregate measure of 29.6%, which is the proportion of median pre-tax household income that is required to service the cost of mortgage payments (principal and interest), property taxes, and utilities based on the average market price of all housing types in any given market. 

This year’s federal budget increased the Home Buyers’ Plan (HBP) withdrawal limit from $25,000 to $35,000, and extended the HBP to those going through a marital breakdown so they can use their RRSPs to put towards a down payment on a home. These changes are effective immediately.

The federal government will also carefully monitor the federal mortgage stress test, given industry concerns over how these new regulations are unnecessarily creating unintended consequences on housing markets which are in balance - or even struggling - compared to overheated ones. 

 “Be it changing market conditions within the various property types or new budget measures affecting housing, you should be calling your Realtor to keep abreast of what these changes mean as you try to better understand and navigate the housing market,” said Marina R. James, CEO of WinnipegREALTORS®.

Winnipeg’s housing market remains one of the more affordable in Canada, and along with the recent changes to the HBP and PST, we have much to be optimistic about.

Jim Born
FEBRUARY SALES UP 6%

WINNIPEG - February sales of 724 show a 6% increase over February 2018 and a 10% rise in dollar volume at over $215 million. 1,447 new listings were added to the market in February which resulted in 3,735 active listings available for sale at the end of February. This healthy supply of listings represents a 10% increase over last year.

Year-to-date sales are up 8% over the same period in 2018 and 3% over the 5-year average. They are only 2% behind the record- setting pace of 2016.

“We have now had two back to back months of improvement in sales and listing gains over 2018,” said Kenneth Clark, president of WinnipegREALTORS®. “While early in the year and a cold one at that, it does show buyers are making necessary adjustments to mortgage regulation rules to complete a transaction. Some of the increase in listings, most notable in January with a 19% increase in new listings coming on the market, is that sellers are feeling more confident about taking their next step in the local housing market.”

Helping set the stage in 2019 for continued recovery from a slow start in 2018 is the fact mortgage rates are remaining historically low with no expectation of another interest rate increase in the next few months and possibly later in the year. Affordable prices remain intact with more than half of all condo sales in February selling for under $200,000 and nearly half of single family homes selling for under $300,000. 

A highlight of February was the strength of residential -detached or single family home sales happening outside the city of Winnipeg. The 152 sales represented 30% of the total amount sold in February. While the Steinbach MLS® area led the way with 28 sales, it is worth noting WinnipegREALTORS® has recently welcomed rural real estate offices to its membership from Winkler, Gimli and Lac du Bonnet.

Single family home sales of 505 increased 6.5% in February when compared to February 2018. Condominium sales were up as well with 107 sales, a 5% increase over February 2018 and 10% greater than the 5-year average of 97 sales.

Other MLS® property types which outperformed February 2018 with double-digit percentage increases were commercial, single- attached and duplexes. The 34 single-attached sales represented close to 5% of total MLS® sales in February where residential-detached and condominium sales captured 70% and 15% respectively.

Looking ahead to March, all three levels of government are releasing their annual budgets. The City of Winnipeg unveiled their operating and capital budget on March 1, 2019 with a proposed 2.33% property tax increase. The provincial budget comes down on March 7th while the federal government will release theirs on March 19th.

Noteworthy this year is there has been a strong push from the real estate industry to urge the federal government to provide relief to millennials who were disproportionately affected last year by the mortgage stress test.

Federal Finance Minister Bill Morneau has already acknowledged this reality and has indicated he is looking to provide young homebuyers with better means to own a home. A national survey conducted last year by Abacus Research for the Canadian Real Estate Association (CREA) on housing affordability showed 85 per cent of millennials and new Canadians want to own their own homes. CREA CEO Michael Bourque says, “The idea of renting for life does not appeal to either group.”

“The combination of a wide choice of affordable properties to purchase in our local market gives us an advantage over more expensive housing markets in the country,” said Clark. “However our first-time buyer market in 2018 did experience a noticeable drop off in sales activity so any relief from the federal government’s budget would be welcome here too.”

“Our REALTORS® are professional and informed,” said Marina R. James, CEO of WinnipegREALTORS®. “They make it their business to keep on top of any new developments that affect the housing market.”

 
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Jim Born
A RECORD START TO 2019

WINNIPEG - January MLS® sales of 634 increased 11% over the same month last year and 8% over the 5-year average for January. Dollar volume rose 12% to $175 million. The 1,783 new listings entered on the MLS® in January also resulted in a double-digit gain of 19% compared to January 2018. 

“This is the best start on record for January in our local real estate market,” said Kenneth Clark, president of WinnipegREALTORS®. “However, as they say, one month does not make a year so we remain cautiously optimistic.” 

On a positive note, mortgage rates are remaining historically low with the Bank of Canada signaling a wait and see approach on any interest rate increases this year. Buyers have also had over a year to adjust to the B-20 mortgage regulation rules which came into effect January 1, 2018.  

“The noticeable bump up in new listings includes some of those move–up buyers last year that decided to remain on the sidelines to figure out what they could afford to buy based on the new mortgage regulations,” said Clark. “Helping make it easier for them to enter our housing market this year is a combination of a healthy supply of available listings to choose from at affordable prices.”

No better example of affordable prices came by way of the condo sales activity in January 2019. In what is more the exception than the rule in our local market, there were 34 sales under $150,000 compared to 12 in January 2018. A number of these units sold for as low as $31,500 with total square footage of less than 500 square feet. 56% of total condo sales went for less than $200,000. 

For comparison purposes, 22% of residential-detached or single family homes sold for less than $200,000. On the other end of the price spectrum, the highest-priced single family home sold for $910,000 while a condominium sold for $832,229. 

WinnipegREALTORS® just held its annual forecast breakfast and indicated that sales should outpace 2018 while prices will remain stable. The condo property type in particular is experiencing an elevated supply of listings going into 2019, so will be one to watch closely.  

“Knowing which questions to ask with a myriad of terms and conditions to consider, is best left to a REALTOR®- an experienced negotiator who is objective about the buying process,” said Marina R. James, CEO of WinnipegREALTORS®. “Our REALTORS® are there to serve your interest in achieving the best outcome for you.”

 
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Jim Born
HOME VALUES REMAIN CONSISTENT IN 2018

WINNIPEG - In comparison to a near record year in 2017, 2018 held its own with sales down 5% from 2017 and 6% from the best year on record in 2016. Sales of 12,773 are down less than 3% from the five – year average and 1% lower than the 10-year average.

Annual dollar volume on the other hand of $3.77 billion decreased less than 4% from 2017 and is up nearly 3% from the five-year average. 

The 23,834 listings entered on the MLS® in 2018 rose 2% over 2017. There are 3,235 listings available for sale at the end of 2018. 

“Keeping things in perspective, with some of the headwinds we faced in 2018 with higher interest rates and more stringent mortgage qualification requirements, it should be no surprise that 2018 fell short of our best years on record,” said Chris Dudeck, outgoing president of WinnipegREALTORS®. “Simply put, we believe fewer buyers were able to qualify and successfully complete a purchase they wished to make in 2018.”

Dudeck added, “I see 2018 as more policy-induced retraction, albeit a modest one, than changes in key market factors from 2017.” Market metrics are closely aligned between the two years. For example, in terms of achieving a total sales price dollar value ratio close to total list price dollar value in 2018 for single family homes which sold, the annual ratio compares very favourably – 98.48% versus 98.59% in 2017. Another metric to note is average days to sell a home or condo in 2018 only took one day longer than 2017.”

Sales transacted in both single-family homes and condominiums were only one day off the number of days on average it took to sell them in 2017. One of the main reasons the WinnipegREALTORS® market region was less affected in comparison to some other housing markets is its favourable housing affordability.

The December 2018 RBC Housing Trends and Affordability Report indicates “ownership costs remain well under control”. The measure of 31% for the third quarter (the percentage of median pre-tax household income required to service the cost of mortgage payments, property taxes and utilities based on the average market price of the aggregate of all housing types) is very close to the long-run average of 29.5%. The RBC Report states: “The slowdown in activity in 2018 has been orderly with demand and supply remaining in balance overall, although the condo segment showed more visible signs of weakness.”

Speaking of prices, the average residential-detached or single family home sales price in 2018 was $321,945, a very modest increase of 2% over 2017.

The chart below shows how each of the geographic areas within Winnipeg performed with respect to their average home sales price as well as the area representing rural municipalities. All areas saw slight increases over 2017 with the exception of the southeast area where its price equaled last year’s result.

Two MLS® areas least impacted by buyer challenges were the southwest zone of Winnipeg and the rural municipalities surrounding Winnipeg. The former saw sales decline under 1%, while the latter rural zone decreased 1% in comparison to sales generated in 2017. The rural zone continues to represent the highest percentage of sales of all MLS® areas at over 26%.

Over half of the residential-detached sales in 2018 occurred under $300,000 with another 28% selling from $300,000 to $399,999. The 9,287 sales represented nearly $3 billion in dollar volume with the most expensive home selling for $2.6 million.

Nearly 90% of all condominium sales in 2018 were under $350,000 with the $150,000 to $199,999 price range the most active with 27% of total condominium sales. There were 1,638 transactions worth $391 million. The highest-priced condominium sold for $1,200,000.

“I am proud of how our REALTOR® members worked so hard this past year to meet both buyer and seller expectations given that were more financing issues to overcome.” said Marina R. James, CEO of WinnipegREALTORS®. REALTORS® operate in an ever-changing real estate industry and continually update their knowledge so their clients are supported through the buying and selling process.”

 
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Jim Born
LOCAL MARKET REMAINS VERY STABLE AND RESILIENT

WINNIPEG — July sales activity decreased 4% from July 2017 and was off only 2% from the 5-year average for this month. If you remove the exceptional record-setting month of July 2014 which was close to 1,500 sales, the 1,376 sales transacted this July are less than 1% behind the average sales activity for this month. July 2017 was the second best July on record at 1,438 sales.

The narrow range in percentage terms of sales activity between this year and the 5 –year average for all MLS® sales in July is also exemplified in the two closely followed property types of residential-detached and condominiums. The 1,006 residential-detached sales in July decreased 2% from the 5-year average of 1,030 sales while the 176 condominium sales are just short of the 5-year average of 180 sales.

“We need to keep perspective from month-to-month and even year-to-year that despite what appears sometimes as drop off in sales activity or elevated sales in other instances, our local market remains very stable and resilient to wide fluctuations,” said Chris Dudeck, president of WinnipegREALTORS®. “Our home sale prices as well show a high degree of consistency and this is in part attributable to an economy that is one of the most diversified and stable in Canada.”

One property type which did shine in July was single-attached. It is another affordable housing option for buyers to consider when making their purchasing decision. Single-attached sales in July were up 44% over July 2017 and have increased 3% over the first seven months of 2018 in comparison to the same period last year.

Both new listings being entered on the market in July and the inventory at the end of the month are up over 8%. There are 5,278 MLS® listings available for sale in August.

Year-to-date sales activity is down less than 7% from the same period last year with sales of 7,944 while dollar volume of nearly $2.4 billion is 5% off last year’s record-setting pace.

Price range sales activity for residential-detached properties in July shows the $250,000 to $299,999 price range has the highest percentage of total sales at 19% with the next higher and lower price ranges of $300,000 to $349,999 and $200,000 to $249,999 placing second at 16% each. There is still a wide disparity in the highest and lowest price sales price at $1,665,000 and $38,500 respectively.

Condominium price range sales activity in July shows double-digit price range sales percentages in price ranges from $100,000 to $349,999. The most active price range remains the $150,000 to $199,999 at 29% however not far behind is the $200,000 to $249,999 one at 23%. The highest condo sale price in July was $964,950 with a condo unit selling for $99,000 at the other end of the price spectrum.

“It is evident from looking at the many price ranges, and the significant difference from the lowest to highest sales price, that there are considerable options to choose from with over 5,000 MLS® listings available,” said Dudeck. “The month of August has become one of the more active real estate months for sales, so we can expect many buyers to take advantage of what lies before them.”

An interesting milestone for Manitoba has been noted in the Manitoba Economic Highlights report released monthly by Manitoba Finance. It says that in 2017 the working age population (15-64) went over one million persons for the first time. This growing labour pool enables Manitoba business to draw from it to create more jobs which in turn drive housing purchases and significant economic spin-offs from them.

The latest 2017 Altus Group Report prepared for the Canadian Real Estate Association shows for every MLS® sale in Manitoba, $52,500 is generated in additional economic activity. Direct and indirect employment also results from the purchase and sale of MLS® listings.

“You need to be working with a REALTOR® – a professional who knows how best to advise you on navigating the current real estate market to maximize results,” said Marina R. James, CEO of WinnipegREALTORS®. “Advanced planning and preparation will make it easier for you to get a head start on meeting your home buying and home selling needs.”

 
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Jim Born
MAY SALES DECREASE 11% FROM BEST MONTH EVER IN MAY 2017


WINNIPEG - May sales were down from the best May and month on record in 2017 when close to 1,700 transactions were processed on WinnipegREALTORS® MLS®. The 1,510 sales recorded in May 2018 decreased 11% from the same month last year and are down 4% from May’s 5-year average sales numbers and 1% from the 10-year average. Dollar volume of $458.4 million decreased 8% from May 2017.

New listings coming on the market in May decreased less than 2% while inventory at the end of the month increased 3% to 5,103 listings. When broken down into the two main property types of residential-detached and condominiums, inventory sits at 2,750 and 973 respectively. If no new listings were to come on the market this inventory would run out in roughly two and one-half months for residential-detached properties and five months for condominiums.

“While you cannot hit home runs every year, there are some headwinds facing the market this May that were not in play last year, “said Chris Dudeck, president of WinnipegREALTORS®. “Higher lending rates in tandem with more stringent mortgage qualifying requirements are dampening demand even in our more affordable housing market. There was also a pull-forward in the spring of 2017 of new residential-detached, condominiums, single-attached and town house property type sales to avoid paying City of Winnipeg impact fees.”

Year-to-date sales of 5,021 are down less than 8% from the two busiest years on record in 2016 and 2017 but slightly ahead of the previous three years from 2013 to 2015. Dollar volume of $1.488 billion is 6% off last year’s $1.58 billion total.

Despite some slowdown in market activity in May and year-to-date, there are positive indicators to report on in May. 

Average days to sell in May for residential-detached and condominiums properties were less than four and five weeks respectively. Sales of homes in the $300,000 to $349,999 price range were particularly fast-paced with average days to sell of only 16 days. Condominiums, predominantly new units, sold on average in 17 days in the $350,000 to $399,999 price range.

The average sales price in May in comparison to May 2017 was up modestly too for both residential-detached and condominiums. 

An indicator of demand outstripping supply for residential-detached sales for certain MLS® areas was the number of homes selling for above list price reached 28%, a 2 percentage point increase from May 2017. 

This reality is borne out by a number of neighbourhoods dispersed throughout Winnipeg which had sales numbers exceeding the number of listings remaining for sale at the end of the month. The same situation does not exist for condominiums with just 9% of condominiums in May selling for above list price. There is a healthy supply of condominium listings available to choose from throughout the Winnipeg Metropolitan Region.

The overall absorption rate for MLS® listings going into June is less than 3 and one-half months however one area to watch for is the build-up in condominium inventory. Condominium inventory is up 10% from last year at close to 1,000 listings.

“Given how there has been more time for both mortgage lenders and buyers to adjust to the new mortgage rule requirements including an modest increase in the Bank of Canada’s five-year benchmark rate, I am hopeful June may be a catch up month and will usher in improved performance in sales activity,” said Dudeck. “It would not surprise me to see June edge out May in sales this year.”

 “ A professional REALTOR® is who you should be calling to find out what is your best recourse in terms of what you need to do in navigating our current real estate market”, said Marina R. James, CEO of WinnipegREALTORS®.

 
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Jim Born
APRIL REGAINS SOME LOST MOMENTUM IN 2018

WINNIPEG - April sales began to take off like our Winnipeg Jets. Sales of 1,283 were more spring-like in numbers as only down 1% from last April and up nearly 2% over the 10-year average for this month. New listings of 2,621 in April increased 7% from the same month last year while the existing inventory at month end of 4,550 was up nearly 4% over 2017.

MLS® dollar volume of nearly $390 million just edged out last year’s total. Year-to-date dollar volume climbed over $1 billion and is less than 5% off last year’s first four month total dollar volume. Year-to-date sales of 3,511 are down 6% from the same period in 2017.

April’s average residential-detached sales price was just under $330,000, a modest increase over April 2017. Helping elevate this average sales price was a home in East Fort Garry which sold above list price for $2.6 million and three other million dollar plus home sales in the Waverley West MLS® area.

The April condominium average sales price of $236,027 was down slightly from April 2017. Condo sales of 165 were ahead of last April’s total by 5%. The highest percentage increase of all MLS® property type sales in April was duplexes at 50%.

“Clearly market activity picked up in April to show once again how resilient the Winnipeg Metropolitan Region can be in the face of some adversity with new mortgage qualification rules in place as well as higher mortgage rates,” said Chris Dudeck, president of WinnipegREALTORS®. “A real enduring strength of our local market in the last few years has been its affordable prices with different options to choose from given overall balanced market conditions.”

A true test of this year’s return to more seasonal sales activity will be this month as last May had the highest monthly sales ever at just under 1,700 sales. Can it be a jet-fuelled month? Only time will tell but there are positive signs as a result of solid market metrics in April.

While there are more listings on the market going into May than there were last year this does not mean they are all evenly distributed amongst varying property types and areas within the Winnipeg Metropolitan Region. Residential-detached listings of nearly 2,400 lean towards tighter market conditions based on expected strong sales the next few months and condominium listings of almost 900 show a more elevated inventory and more opportunities for buyers to with longer days on market to sell and greater selection available.

One clear difference too between these main property types is the percentage of listings selling for above list price in April. 28% of residential-detached properties sold for above list price compared to 9% for condominiums.

As the market gets busy at this time of year you need to be contacting a REALTOR® to make sure you are well positioned if selling your property, and if buying, prequalified and ready to make an offer if the right property is listed in your preferred area,” said Marina James, CEO of WinnipegREALTORS®.

 

 
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Jim Born
A SLOW START TO THE FIRST QUARTER

WINNIPEG - Sales in March resulted in a slower first quarter especially in comparison to the two best years on record in 2016 and 2017. Sales of 2,228 are down over 8% from the first 3 months in 2017, and 4% over the 10-year average. March sales of 974 decreased 12% from March 2017, and 5% over the 10-year average. March new listings at just under 2,100 were down to a lesser extent at 5%.

Current inventory of MLS® listings going into the second quarter is almost identical to last year. It sits around 3,900 listings with a modest percentage gain of residential-detached listings available while condominium listings slipped slightly.

It is fair to say while market fundamentals are firmly in place in the local market, new mortgage rules combined with higher mortgage rates in the last year have made it more difficult for some buyers to purchase their desired property. This not only applies to first-time buyers, but to existing home owners who instead of listing their property have decided to stay put as the tougher qualifying environment keeps them from moving ahead with a new purchase.

As in other real estate markets across the country, strong year-end sales within the Winnipeg Metropolitan Region in November and December in advance of the January 1, 2018 new stress test on uninsured mortgages would have had a pull-forward effect on sales happening this first quarter.

Of course you can never discount mother- nature either as March has been unseasonably cold and did nothing to motivate buyers to kick start the spring market.

“The second quarter is by far the busiest quarter of the year and it will truly tell the story if the slow first quarter start is just that,” said Chris Dudeck, president of WinnipegREALTORS®. “We need to see if April regains some of the market momentum lost in the first quarter.”

Further analysis of both residential-detached and condominium properties provide a few observations.

While condominiums saw sales drop 14% in the first quarter, they are only 1% below the 10-year average. The average sales price of $240,740 was less than 2% below the more active first quarter of 2017.

Residential-detached, the most expensive property type class and one most vulnerable to recent policy-related moves to slow down the housing market, experienced an 11% decline over the 2017 first quarter, and a 7% drop off in same period sales over the 10-year average. The average sales price was higher however at $327,959 compared to $319,549, up nearly 3%, and the average days to sell was 29 versus 27 in 2017.

It is also worth noting the ratio of total sales price, to total list price, edged up to 99% in the month of March. This high percentage ratio can be attributed in part to a number of MLS® areas seeing whatever listings they had available sell quickly.

“ The majority of MLS® areas which experienced the biggest decrease in residential-detached sales compared to last year were in the more affordable price ranges and often had a corresponding drop off in available listings,” said Dudeck.

This same pattern was less apparent with condominiums which had more of an issue with less listings being sold compared to last year.

“As this first quarter demonstrates, changes occur within property types, price ranges and areas throughout the market region, “said Marina James, CEO of WinnipegREALTORS®. You need to be calling a REALTOR® to advise you on your best course of action.”

 

 
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Jim Born
FEBRUARY SALES DOWN 11%

WINNIPEG - It was an off month for WinnipegREALTORS® as February sales of 683 declined 11% from the same month last year and 10% over the 10-year average for February.  Year-to-date sales of 1,250 are 5% off the pace set in 2017 when there were 1,327 sales. Year-to-date dollar volume worth $352 million in real estate transactions is also down 5% from the same period last year.

When comparing MLS® listings to last year, overall supply is not the issue as the inventory at the end of February of just under 3,400 is equivalent to 2017. New listings coming on the market for residential-detached and condominium properties in February were not markedly different either from February 2017. 

Simply put, buyers were less active than last year.  Sales fell short in the two main property types – residential-detached and condominiums. While condominium sales decreased 16%, the 102 sales transacted are above the 10-year average by 8%. Residential-detached sales, on the other hand, were below the 10-year average by 10% and 11% in comparison to February 2017.

There is no one reason why residential-detached sales saw a drop off in activity.  One MLS® area in particular was down markedly from 2017 because of a lack of listings, where other MLS® areas experienced a noticeable drop off in sales compared to available listings.

As for the distribution of sales throughout the entire residential-detached price range spectrum, the tilt in percentage of sales activity favoured the higher price ranges above $300,000. This was even more accentuated for condominium sales activity in higher price ranges. The usually dominant $150,000 to $199,999 price range dropped in total sales percentage from 36% in 2017 to 19% this year.

“A disappointing sales result but still too early in year to draw any firm conclusions,” said WinnipegREALTORS® president Chris Dudeck. “Based on an increase in higher end price range sales activity in relation to lower price ranges compared to last February the new stress test on insured mortgages (came into effect on January 1, 2018)  does not appear to be a leading cause of slower sales activity.”

It is also worth noting, residential-detached properties which did sell in February, actually sold faster in 2018 than 2017. The average days to sell was 32 days, 2 days quicker than February 2017, while average days to sell a condo was the same as February 2017 at 45 days. 

One thing that is clear, with tougher qualifying requirements for both insured and uninsured mortgages this year, and higher mortgage rates, buyers should be proactive in getting pre-approvals so that when they are ready to purchase a home they are qualified to buy.

This week the Bank of Canada held its benchmark interest rate at 1.25 per cent, though one more hike is expected this year. Lingering trade issues including concerns over NAFTA may well push back another rate hike until later in 2018. The Bank of Canada is also assessing the housing market as part of their rate-tightening plan given softer sales activity this year. 

“All markets are local and activity within the various property types behaves differently depending on the price range and area,” said Marina R. James, CEO of WinnipegREALTORS®. “You are always best advised to contact a professional REALTOR® to determine a suitable course of action for your own needs.”

Jim Born
SOLID DECEMBER CLOSES OUT A SUCCESSFUL YEAR OF MLS® SALES ACTIVITY

WINNIPEG - A solid result in December of 635 MLS® unit sales and a dollar volume over $179 million capped off a successful year in 2017.

Actual percentage differences in comparison to December 2016 were relatively modest but positive with sales up 3%, dollar volume rising 7% and listings increasing 8%. All MLS® property types performed exceptionally well in December with only residential-detached experiencing a drop of 8% in sales. A total MLS® inventory of 2,851 listings is available for sale as 2018 begins.  

2017 finished up strong with a total of 13,525 sales, down less than 1% from the record year of 2016 where 13,632 sales were transacted. A new annual dollar volume record was set in 2017 with $3.92 billion worth of MLS® sales – an increase of close to 4% in comparison to 2016.

When asked for his insight on 2017, outgoing WinnipegREALTORS® president Blair Sonnichsen said, “Considering tougher mortgage qualification requirements were in effect for insured mortgages, two Bank of Canada interest rate increases were brought in, and impact fees were imposed by the City of Winnipeg on new residential development, we are particularly pleased with our MLS® market performance. This indicates to me our REALTORS® worked diligently with mortgage brokers and financial institutions to overcome any challenges clients may have encountered in this regard. REALTORS® as a result were able to conclude nearly as many sales as they did in our record year of 2016.”

A byproduct of 2017 which has been noted before, is the many affordable options available to buyers in the WinnipegREALTORS® market region. It became very apparent early on in 2017 that buyers were making adjustments within certain property type categories or between them to attain their dream of acquiring a place to call home.

“Within the many neighbourhoods of Winnipeg or the outlying rural municipalities in the capital region, buyers made informed choices and took advantage of one of the most affordable residential real estate markets in the country, “said Sonnichsen.

2017 was a year where stronger move up market activity helped offset some drop off in the first-time buyer price ranges for single family homes. One clear example of higher end sales gaining ground over 2016 was the fact there were 45 million dollar plus homes sold in comparison to 30 in 2016. Even condominiums saw a spike in million dollar plus sales with 6 compared to none in 2016.

More move up sales activity in 2017 was a contributing factor in lifting the annual average sale price upward for both residential-detached and condominium property types. The residential-detached average sale price went from $302,726 in 2016 to $315,720 in 2017. The condominium average sale price rose over $9,000 to $244,687 in 2017.

Residential-detached average sale prices for the MLS® zones of Winnipeg and rural municipalities outside the city show price gains over 2016 with only Winnipeg North decreasing slightly.

The southwest zone eclipsed an average sale price of $400,000 in 2017 for the first time. When you have over 300 sales in one MLS® area (Waverley West) in this zone having an average sale price of $546,664 you know it will skew the entire zone’s average sale price higher. This MLS® zone also includes Tuxedo which had an average sale price of $853,378.

Speaking of residential-detached sales in 2017, despite the sales gains noted in higher price ranges, over half of all sales still occur under $300,000 with the busiest price range from $250,000 to $299,999 commanding a total market share of 21%. It is worth noting the $300,000 to $349,999 price range for the first time in 2017 supplanted the $200,000 to $249,999 price range as the second most active price range. The average days on market to sell a home in 2017 was 29 days, 2 days quicker than 2016.

The highest sale price for homes was $2,460,000 with the lowest selling for only $10,000. The most active price range for condominium sales in 2017 was from $150,000 to $199,999 at 28% of total sales. Another 35% of condo sales occurred fairly evenly in the next two higher price ranges from $200,000 to $249,999 and $250,000 to $299,999. The average days on market to sell a condo in 2017 was 43 days, 4 days quicker than 2016.

The highest sale price for condominiums was $1,575,000 while the lowest was $42,000.

Some other property types did not take a backseat to residential-detached and condominiums in 2017. In fact they outperformed them in terms of sales increases over 2016.

Single-attached properties had a double-digit increase of 12% to finish at 537 sales and a 4% market share. Town houses showed the largest sales increase of them all at 19% while commercial jumped 8%. Residential-detached sales were actually down 2% from 2016 and condominiums which started off the year with high monthly percentage gains over 2016 finished up with an increase under 3%. Condominium sales were only 9 sales short of the annual record set in 2014 when 1,798 sales were transacted on WinnipegREALTORS®’ MLS®.

“What these different property type outcomes illustrate is how important it is to consult with a REALTOR® - your local market expert – on what is happening with respect to your specific property type and how you need to navigate the market to get the best results,” said Marina R. James, CEO of WinnipegREALTORS®.

WinnipegREALTORS® will get into more detail with analysis and explanation of what happened in 2017 when it hosts its 12th Annual Forecast breakfast on February 7, 2018. It will also look ahead to what it expects to happen in 2018 with new federal mortgage lending guidelines, the potential of more Bank of Canada interest rate increases and municipal elections.

“One real strength of our local market is its stability,” said Sonnichsen. “As we embark on a new year I believe Manitoba’s resilient and diversified economy will once again help us meet the headwinds which may pose a challenge to us in 2018.”

 

 
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Jim Born
A REPEAT PERFORMANCE IN NOVEMBER MLS® SALES ACTIVITY

WINNIPEG - If you are going to duplicate a month’s sales activity, do it when it is a good one and that was the case in November. MLS®sales of 878 units in November were one sale higher than November 2016 and 4% above the 10-year average for this month. Only once in 2015 did November sales edge over 900, so not a big difference in sales.

A solid performance in November and year-to-date sales of 12,890 ensures 2017 will be no worse than second highest on record. 2016 was the best year ever with over 13,600 sales.

“A good rebound in November from a slower October sets up a terrific year end result,” said Blair Sonnichsen, president of WinnipegREALTORS®. “We are only down 1% in sales from our best year ever in 2016 and will establish a new dollar volume record of close to $4 billion.”

A highlight in November which has been observed throughout the year is the strength of the upper end market. There were 50 residential-detached sales of over $500,000 compared to 34 last November and 4 sold for over $1 million with one closing at $2 million. One condominium sold for $1,575,000.

As much as the two MLS® property types of residential-detached and condominium represent nearly 86% of total sales, the single-attached property type has emerged this year as a real solid performer with over 500 sales and 4% of total MLS® market share. In November unit sales were up 22% and year-to-date sales are ahead by 11%. 

Balanced market conditions still prevail overall with over 4 months of listings available if there were no new listings added on to the MLS® system.

Condominium supply remains elevated in comparison to residential-detached. Based on slower condo sales in the upcoming months over 700 active condo listings equates to at least 7 months of supply. This difference is really borne out when you see in November 32% or nearly one out of every three active residential-detached listings sold to just 15% of the entire condominium inventory turning over.

MLS® area neighbourhoods such as Riverview, Crescentwood, River Heights, Wolseley, Southdale, Fort Garry, Linden Woods, Garden Grove and Harbourview South show depleted inventories in relation to residential-detached sales this year.

“Depending on the property type and area of the city or capital region you wish to live in, you need to be calling a REALTOR® to provide their knowledge and expertise on what your best course of action is based on current market conditions, especially due to financing,” said Marina R. James, CEO of WinnipegREALTORS®. “All real estate markets are local and vary within according to different market indicators.”

Commencing January 1, 2018, a new stress test comes into effect on Canadians making down payments of over 20 per cent and therefore not requiring mortgage insurance. It applies to all federally regulated financial institutions and requires the applicant to qualify for mortgage payments based on the greater of either the Bank of Canada’s five-year benchmark rate or their contract mortgage rate plus two percentage points.

Backing up WinnipegREALTORS® claim that it has one of the most affordable major real estate markets in the country is the percentage of sales it has under $300,000. In November 59% of residential-detached sales and 77% of condo sales were under $300,000. The busiest condominium price range at 26% of total sales was from $150,000 to $199,999.

Helping WinnipegREALTORS® achieve another very successful year of MLS® sales is Manitoba’s well diversified and stable economy,” said Peter Squire, Vice President of External Relations and Market Intelligence.

He noted the unemployment rate is averaging 5.4%, second lowest among provinces and employment has increased by nearly 10,000 in the first 11 months of 2017. Average weekly earnings increases of 2.4% as of September 2017 are also second among provinces. 

Jim Born
OCTOBER SALES FALL BACK LIKE DAYLIGHT SAVINGS TIME

WINNIPEG - October sales decreased 10% from October 2016 and were off 4% from the 10-year October average. The drop in sales activity was largely predominant in the residential-detached and condominium property types selling for under $300,000.

The sales decrease in part, was the result of being up against increased sales activity in early October 2016 because home buyers then wanted to maximize their buying power before the October 17th stress test came into effect on insured mortgages. The new qualification requirement meant applicants had to qualify for the five- year fixed term Bank of Canada rate of 4.64 per cent.

October sales of 1,023 pushed year-to-date sales over 12,000 – only the second time this has happened and just 1% off last year’s record-setting pace of over 12,100 sales. Year-to-date dollar volume is the highest it has ever been at nearly $3.5 billion, up over 3% from 2016. Based on slower sales and dollar volume activity in the last two months of the year dollar volume, will not reach the $4 billion benchmark level but another annual dollar volume record will be set.

“October sales results clearly showed how government intervention in to the real estate market has affected it”, said Blair Sonnichsen, president of WinnipegREALTORS®. “The first-time buyer market for residential-detached properties has been softer this year and conversely more affordable property types such as single attached and townhouses have performed better.”

Both single-attached and townhouse sales this year are well ahead of 2016 with percentage increases of 10% and 23% respectively. Residential-detached sales are down 2% for the first 10 months.

One offsetting factor to mitigate a higher percentage decline in residential-detached sales in 2017 compared to last year, as a result of tougher mortgage qualification requirements, is a stronger move-up market.

Two examples back this point up. In October the southwest MLS® zone which had an average residential-detached sale price of over $400,000 saw sales increase this October while all the other more affordably priced MLS® zones ,including the rural MLS® areas outside Winnipeg, were either seeing fewer sales or flat in residential-detached sales activity.

Another example of stronger move- up activity this year is the significant difference in million dollar plus sales compared to the previous three years. For the first ten months there have been 45 sales in total, 40 residential-detached sales and 5 condominium sales. This compares to a total of 27 in 2016 and 20 in both 2015 and 2014.

“Our market may experience move-up sales activity than normal until the end of 2017 given that The Office of the Superintendent of Financial Institutions (OSFI) just approved a new stress test on federally regulated mortgage lenders with respect to insured mortgages commencing January 1, 2018,” Sonnichsen said. “Similar to last year’s higher qualification requirement on insured mortgages which has heavily impacted first-time buyers, this new guideline will affect move-up buyers more and will limit their ability to qualify for higher- priced homes. They must meet the minimum qualifying rate for an uninsured mortgage which is the higher of either the five-year Bank of Canada rate or one that is 2 percentage points higher than their contractual mortgage rate.”

Helping some Manitobans feel confident about advancing their buying decision now before this new stress test kicks in is the recent good news of job gains for Manitoba. Statistics Canada reported the Manitoba economy added 4,000 new jobs in October and as a result had its unemployment rate drop to 5.2 per cent, second only to British Columbia at 4.9 per cent.

Further, October 2017 MLS® sales activity reported prevalent condominium sales in the under $200,000 price range. These sales represented 44% of total condo sales. In comparison sales under $200,000 for the residential-detached property type were 16%.

“Whatever price range you are looking to buy in, you need to be calling a REALTOR®- a market expert who will help you navigate the ever changing real estate environment and real estate financing” said Marina R. James, CEO of WinnipegREALTORS®.

Jim Born
WinnipegREALTORS® HAS HIGHEST THIRD QUARTER SALES ON RECORD

WINNIPEG - September sales of close to 1,200 processed through WinnipegREALTORS® MLS® System closed off the third quarter with a record total of 3,916 sales, just ahead of the previous best third quarter in 2016.

September sales of 1,193 were down less than 2% from September 2016, the highest level of sales for the month of September in WinnipegREALTORS® 114-year history. The impressive third quarter sales activity moves total MLS® sales to just 11 sales shy of 11,000, the new benchmark sales level established in 2016 for the first three quarters.

“Our sales activity this year has kept pace with record-setting sales in 2016” said Blair Sonnichsen. “Our more affordably-priced housing options in our local real estate market have been instrumental in enabling buyers to successfully conclude a purchase this year.”

One of those options includes purchasing a property outside Winnipeg as the outlying rural municipalities have experienced growth in total market share over the past few years. In September alone rural residential-detached sales represented 28% of total sales.

This year-to-date breakdown chart of all residential-detached sales in Winnipeg and the rural municipalities shows the latter represents 26% of total sales. Steinbach is the most active MLS® area of all MLS® areas WinnipegREALTORS® tracks every year with 365 sales in the first nine months. 

“Our capital region has been growing at a more rapid pace than the City of Winnipeg and that is being reflected in our residential-detached sales,” Sonnichsen said.

When it comes to condominium sales Winnipeg is far more dominant compared to outside the city and Osborne Village remains the premier MLS® area with 132 sales. Of note this year is the emergence of the downtown in second place with 92 sales -14 of them occurred in September.

Backing up WinnipegREALTORS® contention that real estate is more affordable than in most other major markets across the country was the recent release of RBC’s Housing Affordability Measures 2017 second quarter report. In stating housing markets such as ones in the Toronto area are eroding Canada’s affordability to its worst level since 1990, it shines a light on Winnipeg saying its “neutral affordability conditions continue to support brisk housing activity. Home resales in the area are on pace to equal, if not surpass, last year’s record high”. It goes on to say Winnipeg’s housing affordability is “very close to its long-run average”.

“REALTORS® are well informed market experts who can show you all the affordable housing options which exist in Winnipeg and the capital region,” said Marina R. James, CEO of WinnipegREALTORS®.

Going into the fourth quarter listing supply remains balanced overall however there are differences within WinnipegREALTORS® market region and between the various property types.

The most active price range for residential-detached sales in September was from $250,000 to $299,999, 22% of total sales. 55% of all residential-detached sales in September were priced under $300,000. The highest priced residential-detached property sold was $1,451,000 while the lowest was $22,000.

Condominium sales activity was most active in the $150,000 to $199,999 price range at 27% of total sales. 77% of all condominiums in September sold for under $300,000. The highest condo sales price was $560,000. The lowest-priced one was $49,500.

Jim Born
UPPER END MARKET A HIGH POINT IN AUGUST

WINNIPEG - What stood out in August was the performance of the higher end of the market where residential-detached sales above $500,000 were up 32% over August 2016 and 7 sales eclipsed 1 million dollars in value. There were some other high end commercial sales with a motor inn and apartment complex each selling for over $1 million.

MLS® unit sales of 1,288 were down 5% from August 2016 - the best August on record. However sales in August were up nearly 6% over the 10-year average for the month of August. As a result of the upper end market performing so well and residential-detached sales under $300,000 down 35% from August 2016 MLS® dollar volume increased 4% to $378 million.

Year-to-date MLS® unit sales activity is marginally ahead of 2016 with a total of 9,796 sales. Dollar volume on the other hand has risen 5% over 2016 to $2.86 billion.

At the end of August inventory of 2,469 residential-detached properties is down 11% while condominium supply of 855 units is up 5% in comparison to the same time last year.

“August demonstrated demand and confidence in our local market remains strong by virtue of the strength of the upper end market,” said Blair Sonnichsen, president of WinnipegREALTORS®. “It also showed the higher stress test requirement on insured mortgages is preventing a number of buyers from achieving their dream of homeownership and in some instances keeping existing owners from making their next step to another home.”

He added,” With this week’s Bank of Canada interest rate increase to 1% and the federal government considering placing a new stress test on uninsured mortgages, it will make purchasing a home even more difficult for buyers.”

Simply put, the new stress test on uninsured mortgages will require low-risk borrowers to be approved at two percent above the rate offered to them by their lender.

WinnipegREALTORS® supports the Canadian Real Estate Association’s (CREA) position which is calling on the federal government to refrain from introducing any new additional measures to cool housing markets such as Winnipeg’s. When you include the most recent bank rate increase there have been nine changes to tighten mortgage finance in Canada since 2008.

As CREA states in its submission to the Office of the Superintendent of Financial Institutions (OSFI), “We do not believe it is prudent to extend the stress test to uninsured mortgages until the market has had time to absorb and analyze the impact of the compounding effect of interest rate increases and the previously announced tightening measures.”

While 2017 has been tougher on first-time buyers in particular purchasing a residential-detached property, other property types have experienced gains this year due in part to them making alternative choices. Sales of condominiums, duplexes, resort properties and single-attached have all had single-digit percentage increases over the same period in 2016. Town house sales have risen the highest percentage at 11%. It should also be noted commercial property sales are up 9%.

“You need to be talking to your REALTOR® about the options available to you in our local real estate market, “said Marina James, CEO of WinnipegREALTORS®. “REALTORS® know the market and what alternative property types may be possible if your first choice is not attainable.”

The most active price range for residential-detached sales in August was from $250,000 to $299,999, 20% of total sales. Another 30% of sales were evenly split percentage-wise between the $200,000 to $249,999 and $300,000 to $349,999 price ranges. The highest priced residential-detached property sold was $1,700,000.

Condominium sales showed very similar percentage market share in the three price ranges from $150,000 to $299,999 with the lowest price range of $150,000 to $199,999 slightly ahead with 24% of total sales. The highest condo sales price was $439,900.

 

 
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Jim Born
SPRY JULY KEEPS MARKET MOMENTUM INTACT

WINNIPEG - July sales results show a continuation of a second quarter of brisk market activity. Condominium sales really stood out in July with a 32% increase over July 2016.

Total July Multiple Listing Service® (MLS®) unit sales of 1,438 went up 6% over July 2016 level and the 10-year July sales average. It is the second best July on record with only July 2014 eclipsing it by 3%.  This July’s dollar volume of $416 million is the first time the month of July reached and surpassed $400 million in sales transactions.

“Initial concern this year of tougher mortgage requirements affecting sales activity is being overcome by strong demand for all  property types,” said Blair Sonnichsen, president of WinnipegREALTORS®.  “I cannot emphasize enough that in our local market we have different affordable options to choose from. Buyers are taking advantage of them through our REALTORS® keeping them informed and current on all the properties available on our MLS®.” 

Year-to-date MLS®  sales of 8,508 is now slightly ahead of last year’s record-breaking pace while dollar volume at nearly $2.5 billion is up 5% over the same period in 2016.

With a new release of 2016 Statistics Canada Census data this month which provides more breakdowns on families and household make-up, the city of Winnipeg and its entire CMA (includes surrounding municipalities) have grown faster in population over the past 5 years than the national average. Moreover, the number of private dwellings occupied in the city of Winnipeg and surrounding rural municipalities has ratcheted up to accommodate increased population demand for housing.

“These increases in combination with low unemployment numbers and low mortgage rates are creating favourable conditions for sustained housing market activity,” said Sonnichsen. “Proof of how well we are performing this year is our higher conversion of sales to listings in comparison to 2016 when there were 420 more MLS® listings entered by the end of July.”

The drop in listings this year is almost entirely attributed to residential-detached listings whereas other property types such as condominiums have seen their listings in line or greater than 2016.

The most active price range for residential-detached sales in July was from $250,000 to $299,999, 23% of total sales. Broken down further, both the $250,000 to $274,999 and the $275,000 to $299,999 price ranges represented 10.95% and 12.20% of market activity. The closest to these ranges in representing higher sales volume were the $225,000 to $249,999 and $300,000 to $324,999 at 8.55% and 8.26% respectively.

In what is one of the best month performances ever for condominiums at 207 sales, the most active price range was from $150,000 to $199,999 at 27% of total sales. The next busiest price range was from $250,000 to $299,999 at 18% of total sales.

“Our REALTOR®  and mortgage professional members are succeeding in helping buyers navigate through a more difficult mortgage qualification environment in 2017, “ said Marina R. James, CEO of WinnipegREALTORS®. “You should be working with them to understand and determine what your best course of action is with respect to purchasing a home in our local market.”

 
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Jim Born