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A local real estate broker has thrown some cold water on the panic some may be feeling in the housing market.
A local real estate broker has thrown some cold water on the panic some may be feeling in the housing market.
Winnipeg’s real estate market has been like sitting in a hot tub for the last two years and now it is like jumping into a warmer pool, which will feel cold, but the water temperature is, in fact, warm. That’s the analogy used by Michael Froese, a managing partner with Royal LePage during an online webinar on Friday.
“Just because the pool feels colder than the hot tub doesn’t mean it’s bad, it doesn’t mean it’s actually cold,” Froese said. “Some of the market cooling, it’s cooling to go to a beautiful 85 degrees (Fahrenheit), this is a healthy real estate market.”
Froese pointed to the trends in real estate prices as one with peaks and valleys, but generally always heads in the right direction. High home price growth of 15% or more is commonly followed by short periods of modest price drops.
“This is what is also a really key thing to remember, is in real estate, and in housing, the highs of the high are usually more intense than the lows of the lows,” he said.
For instance, the average price of a single-detached home in Winnipeg in 1994 was $89,352, and the following year the average price dropped to $87,387. Then in 1996, the average price jumped up to $90,047.
“There’s going to be seasonal blips,” Froese said. “And we have an interest rate hike anticipated again in July, coinciding with our natural, plateauing and decrease of sales and price activity, means it’s going to it’s going to come down temporarily, but then it bounces back.”
Froese referred to Winnipeg’s housing sector as a “Goldilocks” market because it doesn’t get too hot or too cold, it’s “just right.”
“We’re very resilient to these volatile swings,” he said.
In 2021, 63% of houses sold over their listing price, with 28% going below the listing price and 7% going for the price listed. Froese said bidding wars for houses are slowly de-intensifying as well as the prices homes go for over their listing price.
Sellers are likely to price their homes at a listing they’re more willing to accept in the future, which can lead to more room for negotiation, Froese said. What that means with the sales to listing ratio points to prices holding on, he added.
“We’re going to see some prices depreciation because we have to, and it happens every single year pandemic are not interest rate or not prices always fluctuate, but it will be temporary,” Froese said.
rstelter@postmedia.com
Twitter: @steltsy95
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.
The Canadian Press. All rights reserved.
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.
The Canadian Press. All rights reserved.
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.
The Canadian Press. All rights reserved.
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