City’s housing market remains hot

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This article was published 13/01/2016 (3590 days ago), so information in it may no longer be current.

Last year was another banner year for sales of existing homes in Winnipeg, adding another layer of icing on the cake for the city’s surprisingly resilient housing market.

Year-end data released Tuesday by the Winnipeg Realtors Association (WRA) shows 12,927 properties were sold last year through the local Multiple Listing Service (MLS).

That was the fourth highest sales total in the association’s history, and a 0.7-per-cent improvement from 2014’s total of 12,838. It was also just 152 properties shy of the record set in 2007, when historically low interest rates had the market ablaze with activity.

“It is really quite remarkable how close our year-end sales have been in the last few years, including our highest sales year in 2007,” said outgoing WRA president David MacKenzie.

“They all tend to hover just above or close to the 13,000 level and in percentage terms, we are only talking a little over one per cent when we compare the 12,927 sales recorded (in 2015) to the 13,079 in 2007.”

The association also set a new dollar-volume record in 2015 of $3.5 billion. The previous record of $3.42 billion was set in 2014.

Last year was also a surprisingly good year for the new-homes side of the housing market.

Year-end numbers released Monday by Canada Mortgage and Housing Corporation showed there were 4,400 new single- and multi-family housing starts recorded last year in the Winnipeg Census Metropolitan Area (CMA), which includes Winnipeg and 10 neighbouring municipalities. That included 1,651 new rental units, which was the most in nearly three decades and more than double 2014’s total of 655.

As was the case on the new-homes side, the resale-homes sector finished 2015 on a high note, with the busiest November on record and the third best December. The WRA said 642 properties changed hands last month, which was a four per cent improvement from a year earlier.

MacKenzie said attractive mortgage rates — they’re still at historical lows thanks to a weak Canadian economy — continued to drive resale-home sales in 2015. That and a growing supply of listings on the MLS.

WRA residential market analyst Peter Squire said 24,603 new listings were entered onto the system last year. That was up seven per cent from 2014, and 41 per cent above the 10-year average of 17,433.

It left buyers with a five-month supply of listings going into 2016. That’s a big improvement from the four- to six-week supply that was available going into 2008 and the eight- to 10-week supply that was available at the start of 2009, when the global recession began to take some of the wind out of what had been a six-year housing market boom in Winnipeg.

It was definitely a seller’s market back then, with the demand for homes far outstripping the supply. That, in turn, led to numerous bidding wars and to many homes selling for thousands of dollars above their listed price.

But with the supply of homes now outstripping the demand, it’s a much different story today. Multiple offers aren’t nearly as common, and 75 per of the single-family homes that sold last year through the MLS went for below the listed price. That compares to 42 per cent in 2007 and 43 per cent in 2008.

But MacKenzie noted 2007 and 2008 were exceptional years. He said 75 per cent is more in line with historical norms for Winnipeg.

And while selling prices have softened a bit in the past year, how much they’ve softened can vary greatly from one property to another, he added. He noted a quarter of the homes are still selling for at or above the listed price, and the average selling price for a single-family home still rose by two per cent to $293,992 in 2015.

“But that doesn’t mean everybody’s house has gone up (in value) by two per cent,” he said. “Each case has to be looked at on its own.”

With an abundant supply of available homes and mortgage rates likely to remain low through at least the first half of this year, Mackenzie said the prospects also look good for 2016.

“By all accounts it seems like it’s going to be another steady year.”

Some of the other highlights from 2015 were:

• The condo side of the market got off to a slow start and never fully recovered. Sales were down 10 per cent for the year, and the average selling price declined by one per cent to $236,204.
• It took an average of 33 days to sell a single-family home. That was three days longer than in 2014. It also took an average of 49 days to sell a condo, which was nine days longer than in 2014.
• The most expensive detached-home sale was for $2.7 million. The highest-priced condo sale was $950,000.

murray.mcneill@freepress.mb.ca