Flood hard on home resales

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This article was published 10/05/2011 (5380 days ago), so information in it may no longer be current.

WHILE the local new-homes market was enjoying a surge in homebuilding activity last month, the resale-homes market was being broadsided by its first monthly sales decline of 2011, according to new figures released Monday.

Canada Mortgage and Housing Corp. reported a 50-per-cent increase in single- and multi-family housing starts last month in the Winnipeg Census Metropolitan Area (CMA) — 261 versus 174 in April 2010.

The biggest contributor was a five-fold increase in multi-family starts — 100 versus 19, the housing agency said. Single starts were up a more modest 3.9 per cent to 161 units.

However, it was a much different story on the resale-homes side of the market, which was hit with double-digit declines in new listings, unit sales and dollar volume of sales, according to figures from WinnipegREALTORS.

It was the first time this year that unit sales and the dollar volume through the WR’s Multiple Listing Service were down from the same month a year earlier. Officials blamed it mainly on a preoccupation with the spring flood.

They said activity dropped off during the last two major floods in 1997 and 2009, and that pattern held true again this year. It said listings were down significantly in flood-threatened municipalities like St. Clement and St Andrews, and in Winnipeg neighbourhoods along the Red River, such as St. Vital, Fraser’s Grove and the North End.

“As one of those homeowners along the Red River in St. Vital, I understand first hand how Manitobans put priority over saving their home compared to listing or buying one,” said WR president Ralph Fyfe.

The association said unit sales dropped by 13 per cent to 1,148 from 1,317 a year earlier, while the dollar volume fell by 11 per cent to $268.8 million from $303.1 million.

But while the flood was casting a chill over the resale-homes market, it was having no discernible impact on new-home construction activity, according to Manitoba Home Builders Association president Mike Moore. On the contrary, local builders were able to take full advantage of several weeks of relatively rain-free weather.

“Everybody is quite busy because we’ve had the weather to allow it,” he said, adding combined starts for the first four months of the year are running only 10 per cent behind last year’s pace for the same period. And 2010 was the best year in 23 years for housing starts in Manitoba.

Nationally, the number of starts dipped by 3.1 per cent to an annualized rate of 179,000 in April from 184,700 in March, CMHC said.

murray.mcneill@freepress.mb.ca