The supply is relatively low, and the demand throughout the summer has been relatively high, so when a strong listing comes on the market, it garners significant attention. That can lead to multiple offers, and more often than usual, they are well above the list price.
In July, 31 per cent of all single-family homes sold in the city went for above the asking price, nearly double the proportion the market experienced during the same month in the last five years.
The sweet spot has been in the $250,000 to $300,000 range, where potential buyers intrigued by low mortgage rates tend to cluster.
“When you see houses selling for above list (price), it’s a good indicator you’ve had a number of offers,” said Peter Squire, the vice-president of external relations and market intelligence for Winnipeg Realtors.
That was the experience of agent Ryan Auxtero of RE/MAX Executives Realty. A single-family home on a quiet cove in the Maples was listed at $299,000. Eleven offers were made after 30 to 40 viewings. Auxtero’s clients had submitted an offer that was higher than list price but not high enough; it likely went for about $60,000 more than the asking price.
Another listing in Windsor Park, Auxtero said, would normally receive three or four offers to start. Instead, 30 came in, and it sold for roughly the same amount above the list price.
“I didn’t win that offer,” said Auxtero. “The thirst is clearly there (for buyers).”
In March, some realtors worried sales this year could be abysmal, due to economic instability, a lack of buyer and seller confidence, and even the safety problems of showing a home. Now, the year is shaping up to be an improvement in terms of sales over a historically strong 2019.
“I would say, between (the beginning of the pandemic) and now, it’s a complete 180,” Auxtero said. “We are definitely buying and selling in the new normal.”
The ratio of sales to active listings is extremely high, especially in certain areas of the city, says Squire. At the end of July, Valley Gardens had 13 sales versus two active listings for a ratio of 650 per cent; Crestview, with 16 sales and five listings, was 320 per cent. St. James was near the 300 per cent mark.
Across the country, a similar recovery is underway. Major cities including Toronto and Vancouver have experienced year-over-year jumps in recent months: Toronto region sales went up 30 per cent and sales prices rose 17 per cent, while Vancouver enjoyed a 22 per cent year-over-year sales increase and a 4.5 per cent price increase, the Globe and Mail reported.
Meanwhile, each market had a similar decrease in available stock: “Each market was approximately 15 per cent below July of last year, making it harder for buyers,” the Globe’s Rachel Younglai wrote recently.
Teranet and the National Bank of Canada’s latest house price index, which tracks the rate of change to the price of a single-family home in Canada, had an overall 0.7 per cent increase in June compared to May, the lowest June advance in 17 years. However, Winnipeg’s rate increase was 1.8 per cent, helping to drive the national index upward.
It’s difficult to estimate how long the current wave of demand will roll, but Squire says it’s clear the market has had a quick rebound from its springtime lag.
“We’re obviously catching up, and in some cases, we’re going to be ahead,” said Squire, referring to the upcoming report on July’s housing statistics.
Real estate agents are aware the current demand might not be sustainable.
Mel Boisvert of Century 21 Carrie Realty put a standard 1960s bungalow in Westwood on the market in June. It was in good condition, with a great location, Boisvert said, but the response was greater than he anticipated.
“It just hit at a sweet spot,” he said. “I think we had 52 showings in a week. It’s one of those stories that is sort of a good one for sellers, maybe not so much for buyers,” he said. Listed for $289,000, it sold for “substantially over” that price in early July.
The confluence of low rates on both mortgages and interest, low supply, and changing Canada Mortgage and Housing Corp. credit requirements that took effect July 1 created a perfect storm to lead to multiple offers and a relatively quick sale.
“A week earlier, and things may have been different,” Boisvert said. “The timing, like the location, is very important.”
ben.waldman@freepress.mb.ca
Ben Waldman Reporter
Ben Waldman covers a little bit of everything for the Free Press.
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.
