House market burning hot

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MIKE DEAL / WINNIPEG FREE PRESS Robin Sherman stands in front of a duplex she sold last month for $301,000. (MIKE DEAL / WINNIPEG FREE PRESS) Photo Store

It was like a tale of two cities last month in Winnipeg's resale homes market, with well-heeled buyers jockeying with bargain hunters to make the most noise in an already red-hot market.

Not only did Winnipeg Realtors set a record for the most million-dollar homes to sell in a month -- five -- but more price-conscious buyers were also snapping up duplexes and townhouses like they were going out of style.

The association said sales of single-attached homes -- such as townhouses and row houses -- soared by 77 per cent to 62 from 35 in May 2011. And sales of duplexes weren't far behind, jumping by 68 per cent to 28 from 17 a year earlier.

"That is a lot for one month," said Peter Squire, the WR's residential market analyst.

Squire and other industry officials said it seems to be mostly first-time buyers and rental-property investors who are scooping up duplexes and townhouses.

"I think some of that is a flight to affordability," Squire said, noting the average selling price for a single-attached home, year-to-date, is $203,000 versus about $270,000 for a single-detached property.

"And certainly the investment element is there, alive and well, given our tight rental market," he said, referring to Winnipeg's 1.1 per cent apartment vacancy rate.

Robin Sherman, a duplex-sales specialist with Re/Max Associates, sold five of the 28 duplexes that changed hands last month.

She confirmed the buyers of the five well-maintained properties were a combination of first-time homeowners and rental-property investors.

She said three of the five properties were in central or north Winnipeg, on streets such as Polson and Church avenues, and two were on Cameron Street and William Newton Avenue in Elmwood. All five sold within a week to 10 days of hitting the market.

"I must have had 20 showings on Polson alone," Sherman added. "It was crazy."

Sherman and Winnipeg Realtors president Shirley Przybyl said duplexes are an attractive option for first-time buyers because they can live in half and rent out the other half.

"The idea of living in one half and having the other half pay your mortgage is fantastic," Sherman said. "It's always been fantastic."

She said it was unusual for her to sell that many duplexes in a month. She noted she only sold one or two over the first four months of the year.

All five were properties purchased by Vancouver investors in 2008, when Canada Mortgage and Housing Corp. was still allowing people to buy homes without a down payment.

"It was just a crazy time. We were falling all over each other trying to find (investment) properties to buy."

She said they all signed four-year mortgages that were expiring this year. They decided to sell while the market was hot, and they all pocketed a nice profit.

For example, the owner of the 2,200-square-foot Cameron Street duplex bought it for $229,000 and sold it for $301,000.

"I warned them they were paying top dollar back then (in 2008)," Sherman said. "But the market has just gone up and up, and prices have gotten so much better."

Przybyl said escalating property values are one of the reasons for the record number of million-dollar-plus homes that changed hands last month.

There are a lot more of them now than a few years ago, when many would have still been priced at under $1 million.

WR data show there are 32 such properties listed for sale on its Multiple Listing Service.

Przybyl said some months the association is lucky to see even one million-dollar-plus sale. The previous record was three in a month.

The most expensive home to sell last month was a newer, 3,200-square-foot home in south Headingley's Assiniboine Landing, which sold for $1.2 million.

Squire said the other four -- two in East St. Paul, one in Germaine and one in St. Andrews -- all sold for $1 million or a little more.

They helped the WR set a record for dollar volume of sales in a single month, at $411.4 million. And the 1,605 unit sales was the second highest May total on record.

murray.mcneill@freepress.mb.ca

A marvellous May

1,605 -- number of properties sold last month through the Winnipeg Realtors' Multiple Listing Service

10 -- percentage increase from May 2011's 1,463 sales

$411.4 million -- dollar volume of sales for the month

17 -- percentage increase from May 2011's $350 million

5,434 -- number of properties sold in the first five months of 2012

5 -- percentage increase from the same period last year, when 5,144 properties were sold

$1.33 billion -- dollar value of sales in the first five months

12 -- percentage gain from a year earlier, when $1.18 billion worth of properties changed hands

24 -- average number of days on the market for a residential detached home

18 -- average number of days it took to sell a home priced in the $300,000 to $350,000 range, which was the category with the fastest turnover time

-- source: Winnipeg Realtors

Republished from the Winnipeg Free Press print edition June 6, 2012 B5