‘Crazy’ hot market, scorched homebuyer dreams

Hey there, time traveller!
This article was published 14/02/2022 (1670 days ago), so information in it may no longer be current.

Your house might be right for a bidding war.

Renée Robidoux Kapitoler sees them often nowadays. Last month, she took clients to four homes in southeastern Winnipeg. The couple didn’t buy anything — each house sold for between $95,000 to $120,000 above list price.

“It seems to be more and more common if the house is in good condition,” Robidoux Kapitoler said. “(It’s) crazy.”

Nearly half of all single-family houses in Winnipeg’s market sold for thousands more than the list price in January. There just aren’t enough houses to meet demand, Robidoux Kapitoler said.

She’s been a realtor for 11 years. Pre-pandemic, she’d head south for a few weeks in January — it’s traditionally the slowest month for sales in Winnipeg.

But the housing market was on fire last month. Customers often watched dream homes end up in the hands of people who’d paid a five- or six-figure sum more to secure their place.

“As soon as a new listing pops up, we try to take a look at it right away because there are many, many people out there looking as well,” Robidoux Kapitoler said.

At the end of December, 635 single family homes were available, according to Winnipeg Regional Real Estate Board data. The number is down from the 925 available at the tail of December 2020, and the 1,884 for sale as 2019 closed.

As a result, the average single-family home price jumped above $400,000 — to $401,216 — in January. It’s a first in the WRREB’s history. An average home was $352,185 the same time last year.

“It’s frustrating for buyers,” Robidoux Kapitoler said. “They have their hearts set on a specific house, they see themselves moving in, but… if on offer night there’s five other offers, it becomes more of an emotional game of what do you want to pay for the house.”

Bidding wars haven’t extended to fixer-uppers. Still, two of three single-family homes in January sold for over $300,000.

Prices in southwest Winnipeg climbed 22 per cent, to a single-family house average of $596,587. Costs also shot up in northeast Winnipeg and nearby rural locations.

“It seems to be back-to-back showings,” Robidoux Kapitoler said.

She noted the turnaround is quick — buyers don’t have much time to process whether they love the house.

“(Sometimes) I’m working with clients for a longer period of time,” the realtor said. “In the past, it might be a few months before finding their ideal home. Now, that could stretch out to a year plus.”

”In the past, it might be a few months before finding their ideal home. Now, that could stretch out to a year plus.”–Robidoux Kapitoler

Many have looked outside the city. Robidoux Kapitoler has been selling in Otterburne — it’s near enough to Winnipeg and the lot prices are cheaper.

Customers have also switched focus from buying used to building new, due to sheer frustration, Robidoux Kapitoler said.

“At least they know they’ll be getting what they want,” she said, adding some wait over a year for their new space.

Rob Kliewer decided to build after watching houses fly off the market. He moved into his new two-storey last month, a year after settling on a lot.

House-hunting, he said, “really was quite dejecting, because it’s like, ‘OK, I guess there’s just not going to be anything available for us.’

“I’m not going to spend 10 or 15 or 20 per cent over market in a bidding war to get something that’s not worth it.”

”I’m not going to spend 10 or 15 or 20 per cent over market in a bidding war to get something that’s not worth it.”–Rob Kliewer

Kliewer said he worried about purchasing a home too fast, in a rush, and learning of unnoticed problems later. When it was time to sell his North Kildonan condo, he received four offers on the first day, he said.

There hasn’t been such a depleted supply of listings since 2008, according to a WRREB report released Thursday.

Peter Squire, the WRREB’s vice-president of external communications, points to a lack of houses being listed in spring 2020 as a source of the current shortage.

“We just haven’t been able to catch up,” he said.

Manitoba is coming off three record-breaking years of housing sales. In 2019, around 13,600 sold. In 2020, the number jumped over 16,000, and last year, it hit a new ceiling above 18,500.

“That demand has just overwhelmed what supply we’ve been able to provide,” Squire said.

Sales were down last month — 690, a 26 per cent drop from January 2021 — but there would have been more purchases had houses been available, Squire said. Plus, January 2021 was an anomalous month; last month fell three per cent from January’s five-year average.

“The spring market is key for the success of any real estate market,” Squire said. “You need that intake of new listings.”

More people typically sell their houses in the spring — and it’s really needed this year, to offset demand, Squire said.

Meantime, customers have set their sights on condominiums.

“When you see an average price of $400,000 (for a single-family home) compared to an average price of $250,000, which was the case for condominiums… that’s a big difference,” Squire said. “That affordability equation is definitely kicking in.”

An average condo in January cost $251,629, up 12 per cent from the same time last year.

gabrielle.piche@winnipegfreepress.com