A reduction in the supply of single-family homes in Winnipeg continues to create an uptick in house prices. Meanwhile, one senior bank analyst says escalating prices are a national phenomenon created by a chronic home shortage combined with low mortgage rates and changing home preferences.
According to a Royal LePage house price survey released Wednesday, the aggregate price of a home in the capital region rose 16.9% year-over-year to $352,000 in the second quarter of 2021. The average price of a single-family detached home increased 18.9% to $390,750, while the median price of condos increased 15.2% to $242,000.
“What we really had with the pandemic was a whole bunch of pent-up demand,” Michael Froese, a broker and managing partner with Royal LePage Prime Real Estate, said during an interview Thursday. “We were locked down. Canadians and Winnipeggers saved more money than they’ve ever saved before. We weren’t even able to travel, so people had money, and now they are investing in Manitoba, into cottage country, into their secondary homes. All of these factors contributed to this roaring demand.”
Furthermore, Froese said housing inventory declined during the pandemic, because people listed fewer homes. Now there’s insufficient supply to meet demand.
“And that puts amazing pressure on house prices,” he said. “Winnipeg isn’t used to seeing this. Winnipeg has always been a slow and steady consistent growth city.
A report by Jean-François Perrault, senior vice-president and chief economist with Scotiabank, says Canada’s housing market behaviour is a reflection of a protracted home shortage, which is exacerbated by pandemic-related matters connected to record-low mortgage rates and altered preferences for housing by type and location. The conditions for significant growth in house prices, he explained, were in place long before the pandemic.
“Canada has the lowest number of housing units per 1,000 residents of any G7 country,” he said in his report, Estimating the Structural Housing Shortage in Canada: Are We 100 thousand or Nearly 2 Million Units Short? “The number of housing units per 1,000 Canadians has been falling since 2016 owing to the sharp rise in population growth. An extra 100,000 dwellings would’ve been required to keep the ratio of housing units to population stable since 2016—leaving us still well below the G7 average.”
Perrault said the focus of policymaking should be on enhancing the responsiveness of supply to demand. Most approaches to achieve this, he explained, are difficult politically.
“We propose the urgent creation of a national table composed of federal, provincial, and municipal authorities, along with real-estate developers, investors and civil society organizations to comprehensively identify and tackle the obstacles to more responsive supply in all segments of the housing market,” he said. “There is unfortunately no easy near-term fix, but the more urgency is attached to the problem, the sooner we will see impacts.”
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TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.
The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.
The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.
“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”
The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.
New listings last month totalled 15,328, up 4.3 per cent from a year earlier.
In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.
The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.
“I thought they’d be up for sure, but not necessarily that much,” said Forbes.
“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”
He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.
“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.
“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”
All property types saw more sales in October compared with a year ago throughout the GTA.
Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.
“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
This report by The Canadian Press was first published Nov. 6, 2024.
The Canadian Press. All rights reserved.
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
The Canadian Press. All rights reserved.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
The Canadian Press. All rights reserved.
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