Real estate is an endlessly fascinating topic. Staying top of the constant changes can be a challenge.
In this month’s Kitchener-Waterloo real estate market update, we take a look at the Spring we just had in Southern Ontario. How did the local real estate market perform?
The number of homes sold in Kitchener in April 2021 dropped by 13%, compared to March. There was also a drop in the number of new listings—a decrease of a full 20%. Similar drops were noted in Guelph and Cambridge as well. What can we attribute this to?
It’s an unusual trend, to be sure. In a “normal year” we would expect to see the number of new listings and sales increase from March to April, says Greig Turvey, Sales Representative, GoWylde Team/ReMax.
One reason could be the stricter restrictions put in place by the current province-wide stay-at-home order. It seems to have put a temporary pause on activity, stopping buyers from going house hunting. Another angle involves sellers: If they were hoping to do any fix-up projects or renovations prior to listing their homes for sale, it’s a real challenge to find an available tradesperson right now.
Average sale prices of detached houses have been affected too, decreasing 8% this month compared to last. This isn’t too concerning though, as the average sales price doesn’t always tell the whole story.
While the median sales price for detached homes in April was only down 2.4% compared to March, there’s a huge discrepancy in the numbers. In detached homes sold at $1 million or more, 44 were sold in March and only 28 in April. That is why the average sale price was down so dramatically.
The average sale price for attached homes is down 2%, and condo apartments are down 1% compared to the previous month. 85% of homes are still selling above list price, though even that is a drop from the 90% we saw in March.
Clearly it is still quite a competitive market for buyers. If there is a silver lining, it’s that there has finally been a slight increase in inventory. The number of houses on the market rose to 1.23 months of inventory, from 1.08 just last month.
The bottom line? “We are still in an extreme sellers’ market,” says Turvey, “though it has cooled slightly since March.” His thinking is that the stay-at-home order has affected the market and that maybe some of the recent press about the market being so overheated has resulted in a bit of a cooling off.
Predicts Turvey, “We may have a busy summer this year if buyers and sellers are waiting for restrictions to be lifted.”