State of the Real Estate Market: December 2019
Curious to know how the real estate market is doing in Ontario, Manitoba, and Alberta? We thought so.
Our monthly update will help you better understand the current state of the market so you can make informed decisions with your real estate purchases.
The Toronto Real Estate Board (TREB) reports1 the GTA experiencing strong sales growth with a 17.4% increase compared to December 2018. Year-over-year sales for 2019 vs 2018 were up 12.6% after a decade year low in 2018 following the 2017 hot housing market. TREB’s President Michael Collins commented, “We certainly saw a recovery in sales activity in 2019, particularly in the second half of the year. As anticipated, many home buyers who were initially on the sidelines moved back into the marketplace starting in the spring. Buyer confidence was buoyed by a strong regional economy and declining contract mortgage rates over the course of the year.” Supply continues to be an issue in the GTA with number of listings down 2.4% contrasted to December 2018, which resulted in accelerated price growth. This has caused increased competition amongst homebuyers for the limited supply available. The average selling price for a home in Toronto is $837,788, a year-over-year increase of 12%.
The Ottawa real estate market saw healthy sales in December2 with 761 residential properties sold, resulting in a 15.3% year-over-year increase and a 5.7% increase over the December 5-year average of 720 units sold. OREB President Dwight Delahunt commented, “December’s statistics reflect the same story we’ve seen all year – historically low supply yet higher unit sales than in previous years. Days on market continued to decline, especially in certain pockets of the city, as properties that came on the market were snapped up by prepared buyers.” Looking at 2019, the Ottawa market had a record-breaking year for number of sales and average prices. The low supply has resulted in increased prices. Despite this, Ottawa remains an affordable and desirable city for Canadians. The average selling price for a condominium-class property is $310,675, and the average selling price for a residential-class property is $500,306, a year-over-year increase of 11.5% and 10.3% respectively.
In the Hamilton-Burlington region, sales numbers are down compared to October and November3, but are still 3.9% higher than December 2018. REALTORS® Association of Hamilton-Burlington (RAHB) President Kathy Della-Nebbia reports, “With the holidays and cold weather, sales tend to dip in December when compared to the previous months. It’s a trend we see almost every year. A decrease in new listings and an increase in sales can equal less inventory on the market. With increased competition for the properties available, this looks to be an opportune time to sell your property.” Townhomes have particularly been in demand in the RAHB market, likely due to the affordable price point for space purchased. The RAHB market saw an increase in sales for detached single-family properties and townhomes with year-over-year price increases of 8.2% and 1.4% respectively. Condominium sales dipped in November but recovered in December with the number of sales increasing 14.8% and the average price increasing 10.2% year-over-year. The average selling price for a home in Hamilton-Burlington region is $581,566, a year-over-year increase of 7.6%.
Homes sales continued to slow down in the Kitchener-Waterloo region4 with a moderate decrease of 9% compared to December 2018. The increased demand for housing is reflective of the low number of days on market at 23 days as the 2019 average. The 10-year average for this region is 38 days. KWAR President Colleen Koehler comments, “In 2019, the lack of supply continued to be a hurdle for anyone who was trying to buy their first home, move-up from their current residence, or downsize. This ongoing state of the market caused further escalation of home prices in 2019. With interest rates expected to stay low in the year ahead combined with Waterloo region’s ongoing growth, I expect 2020 will see more price gains alongside a steady increase in sales.” The average selling price for a home in Kitchener-Waterloo in 2019 was $527,718, a 9.3% increase compared to 2018.
The London and St. Thomas Association of REALTORS® (LSTAR) reported 469 homes sold in December5, resulting in a year-over-year increase of 3.4%. 2019 was the third best year for sales activity in this region since 1978, being one of only three years where sales exceeded 10,000 units. The London region’s overall sales-to-new-listings ratio has been climbing throughout the year; a sales-to-new-listings ratio over 60% is considered by the Canadian Real Estate Association (CREA) to favour sellers. Earl Taylor, 2019 LSTAR President, commented, "For the most part of the year, LSTAR's overall sales-to-new-listings ratio hovered around the 70% mark. However, toward the end of the year its value jumped significantly, to reach 110.1%. This means that sellers have the upper hand in home sales negotiations here. It also speaks to the high buyer demand and the lack of local housing supply." The average selling price for a home in the London region is $426,539, a year-over-year increase of 15.1%.
Windsor-Essex County experienced a decrease in market activity of 9.4% compared to December 20186. Looking at year-to-date sales, the largest price range where homes were sold was in the $300,000-$359,999 range, accounting for 17.2% of all residential units sold in 2019. December home sales are similar to the year-to-date figures with 16.7% of sales having occurred in that price range. Average sales price dipped slightly from the November high. The average selling price for a home in the Windsor region is $335,697, a year-over-year increase of 12.1%.
The Winnipeg real estate market7 saw a massive 25% year-over-year increase for number of home sales. December activity capped off a great year in the Winnipeg market with year-end sales the highest level on record. “December market results are not only indicative of a strong second half to 2019 but a very active year as a whole. Buyers in particular benefited from a healthy supply of listings and sales gains across most MLS® property types show they were actively engaged in the 2019 real estate market,” commented Kenneth Clark, outgoing president of WinnipegREALTORS®. In 2019, detached homes sold for 98% of their list price. Compared to Canada’s other major cities, Winnipeg remains affordable with 75% of condominium sales priced under $300,000 and 76% of detached homes sold for under $400,000. The average selling price for a single-family home is $316,336 and the average for condominiums is $229,593, a year-over-year decrease of 1.7% and decrease of 3.9% respectively.
Alberta continues to see low housing market activity for the second consecutive year8. Ann-Marie Lurie, AREA Chief Economist comments, “The economy continues to struggle with slow growth and a weak labour market, preventing any significant change in home sales activity. While the housing supply is adjusting to slower sales, supply adjustments take time, hence the persistent oversupplied scenario and further price declines.” The province is fairly divided with some regions experiencing an easing of inventory levels and some still suffering from great oversupply. The Calgary and Edmonton markets are improving slowly with more balanced market conditions, though most of the market improvement is driven by the lower end of the market with product priced below $300,000.
Randall Weese is a licensed REALTOR® with 13 years’ experience in Ontario who currently holds Broker licenses in Ontario, Manitoba and Alberta. Randall has worked in a variety of business models within the real estate industry. He has been a REALTOR® at one of the largest brokerages in Canada, managed a boutique brokerage, and founded and operated his own brokerage in the Greater Toronto Area; all in addition to acting as a listing agent on thousands of homes across the country during his career. Randall is currently working at Purplebricks where he is the Broker of Record for Ontario, Broker for Alberta and Associate Broker for Manitoba. Furthermore, he oversees Purplebricks’ Customer Service and Compliance departments.