2021 will go down in history as an unforgettable year for the real estate market. It was a record-setting year in many ways, most notably in regard to pricing.
“The average sale price is up a mind-boggling 35%, which is ten times higher than we would expect in a normal year. If you look specifically at detached homes in Waterloo, they are actually up 60% compared to December 2020,” says Greig Turvey, Sales Representative, GoWylde Team/ReMax.
The average sale price for December 2021 was $1,033,432. Prices were up across all categories, from 31% for condos and apartments to 38% for both detached and attached houses.
Inventory was also historically low. Instead of the 500-800 properties that would typically be for sale in Kitchener and Waterloo, there were generally only 100 to 450 at the peak. This led to the extreme competition amongst buyers that ultimately pushed prices up. Competing with 5-15+ other offers became the norm, and the gap between list and sale price increased to a staggering 24%.
In December, 88% of listings sold over asking—and by a lot. “$150,000 to $250,000 over list is now more common than not. I'm old enough to remember when a quarter million dollars wasn't just casually parted with,” says the REALTOR®.
The past two years have changed the entire landscape of real estate in Ontario, and likely throughout most of Canada. Teranet recently published data showing that investors, who ten years ago were the smallest segment of buyers, are now the largest segment and make up 25% of real estate transactions. “I would not be surprised if this trend continues, as investors continue to use their gains to outbid first-time buyers and families.”
Says Turvey, “Unfortunately, 2022 is looking like it will be more of the same. Inventory is unlikely to improve, as we seem to be in a similar situation with regards to COVID, and many people who would normally be moving have no interest in participating in such a brutal market.”
Stay up to date with the latest market trends in Kitchener and Waterloo with real estate agents Brad Wylde and Greig Turvey. Visit the GoWylde Team or call 519-826-7109 for more information.
