What does $1 million get you in Winnipeg’s real estate market?
A high-end, three-bedroom, three-bathroom home in a new neighbourhood, according to Royal LePage in a company report released Thursday outlining what million-dollar homes look like across Canada.
“Winnipeg… in the million-dollar market, it’s great value,” said Chris Pennycook, a real estate agent with Royal LePage.
This house at 1340 Wellington Cres. is currently listed for an asking price of $1.44 million. Demand at such a price point has “grown significantly” over the past five years, according to a local real estate agent. (Mike Deal / Free Press)
City homes carrying that price tag are bigger than the national average — 798 square feet larger — at a typical 2,558 sq. ft.
The market has “grown significantly” over the past five years, added Pennycook, who is among the industry members expecting a local rebound in transaction numbers.
He anticipates some 120 local house sales exceeding $1 million will take place in 2024.
In 2022 — before buyers fully felt a run of interest rate hikes — Winnipeg and its surrounding areas clocked 121 sales in the million-dollar range, by Pennycook’s count.
Last year, amid higher interest rates, Manitoba logged 88 house sales above $1 million, according to the Winnipeg Regional Real Estate Board.
“It takes time for people to adjust their expectations and what they’re going to get and their finances,” Pennycook said. “They’ve (now) adjusted their expectations.”
A decade ago, the price could elicit a 3,500-sq.-ft. house, Pennycook said. “Construction costs have definitely gone up, lot prices have gone up and, therefore, you’re not getting as much house.”
Million-dollar homes are more common, in part, because of higher constructions costs, he added. “Builders can’t build a custom… home for $700,000 anymore. It’s going to be $1 million plus.”
Lanny McInnes, president of the Manitoba Home Builders’ Association, highlighted a 33 per cent increase in labour costs since the start of the COVID-19 pandemic.
Prices on material such as lumber “skyrocketed” and haven’t returned to pre-pandemic rates, he said.
Nationally, construction on a typical 2,400-sq.-ft. home costs $65,000 more now than in 2019, says a survey by the Canadian Home Builders’ Association.
“We’re continuing to see those kinds of price escalations or fluctuations,” McInnes said, pointing to weather and labour challenges disrupting supply chains.
This house on Ruskin Row was listed at $4.79 million. (Royal LePage)
Still, million-dollar home sales consume a sliver of the overall market; just one per cent in 2023, noted Rena Prefontaine, president of the Winnipeg Regional Real Estate Board.
On Wednesday, Royal LePage’s website showcased 40 Manitoba homes for sale at an asking price above $1 million. A seven-bedroom mansion in Winnipeg was listed at $4.79 million.
Eighteen homes sold for more than $2 million from 2020 through 2022, Prefontaine said. Last year, the count was three; at least one in that range has sold thus far in 2024.
Economists predict interest rates will decline this year, which could boost home sales, Prefontaine added.
Meantime, Pennycook said Winnipeg’s million-dollar home market is constricted by a lack of supply.
“This year, so far, with the inventory being low, it really is… a sellers’ market,” he said, adding prices will rise if there’s more demand than supply.
Roughly 5,400 home builds should start this year, keeping in line with 2023, according to MHBA forecasts.
Pennycook said he has worked with former Winnipeg residents who’ve returned to the Manitoba capital amid housing cost crises at larger Canadian cities.
So, too, has Laurie Boudreau, a Winnipeg mortgage broker.
Some of those clients work from home, she said — for $1 million, they can get more space.
However, the million-dollar bracket is no longer exclusive, Laurie added. “Years ago, obviously, only the rich were buying properties of that range.”
Some of her clients have bought million-dollar properties. Often, they’re professionals who have owned two or three houses in the past and made “some very good profit” on property sales, Boudreau said.
This house on Lamont Boulevard was listed at $3.75 million. (Royal LePage)
For example, an Island Lakes neighbourhood home built in 2002 might have cost $265,000 at the time. The same house might now sell for double or triple the price, Boudreau said.
Clients have also bought million-dollar houses for their multi-generational families; some rent a portion for income, she said.
The average sold price of a detached home in Winnipeg was $396,833 in January, the WRREB’s latest market statistics report shows.
The most popular price range for a detached home was between $325,000 and $349,999 in January; the $550,000 to $599,999 segment trailed closely behind.
Detached home prices increased eight per cent year-over-year, the data show.
Nationally (with Toronto, Vancouver and Montreal prices tilting the numbers), $1 million will net a house with three bedrooms, two bathrooms and 1,760 sq. ft., according to the Royal LePage report.
Vancouver recorded the lowest space — averaging 900 sq. ft. — for that price tag.
gabrielle.piche@winnipegfreepress.com
Gabrielle Piché Reporter
Gabby is a big fan of people, writing and learning. She graduated from Red River College’s Creative Communications program in the spring of 2020.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
