Strong employment numbers, positive economic and geographical trends should keep the market among Canada's best
As 2019 begins, so does another year of real estate sales in Waterloo and area.
Housing-price trends have cooled in pockets across Canada (primarily in the Toronto and Vancouver markets) and did so slightly in the City of Waterloo and the surrounding region. The consensus is we should see sales locally that reflect the year past. A few key factors could rock this prediction, but strong employment numbers, positive economic and geographical trends should keep our region's housing market among the best in the country.
Last year we saw average MLS prices revert across the province in comparison to the excellent sales pricing that occurred in the spring of 2017. According to the Canada Mortgage and Housing Corp., the average sale price this past April locally (regionally speaking) was $473,000, compared to $507,000 in April 2017. The City of Waterloo experienced an average sale price of $618,000 for single-detached sales last year, and condos averaged $341,000.
There's no question that the previous Ontario government's Fair Housing Plan, paired with the federal government's mortgage stress test were the prime factors in last year's market correction.
Most recently, Bank of Canada Governor Stephen Poloz has expressed his desire to get interest rates into a neutral territory between 2.5 and 3.5 per cent. Economic trends will play a factor regarding rate-increase pace, and this will likely affect home sales across Canada. Several Canadian homeowners are coming up to renewal time for mortgages and will see rates higher than what they currently have (based on five-year terms). These two major factors for homeowners could affect the level of inventory of homes available for sale in 2019.
So where are home sales headed in Waterloo this year? My prediction is we continue to see strong sales pricing throughout the city compared to our surrounding neighbours. No exceptional circumstance leads me to believe that the inventory of resale homes across town will increase dramatically this year.
Last year's spike in homeowners opting to renovate existing homes instead of making a move will remain the same. Talk to any reputable renovator or contractor in town, and they will show you a full slate of projects carrying them into 2020. The baby-boomer population in the city doesn't appear to be rushing out of their family suburban homes. It's possible we could see a slight shift this year from this demographic, which would result in a much-desired increase in inventory on the west side of Waterloo in the Beechwood and Maple Hills neighbourhoods.
Condo sales will be exciting to watch in the city. Sales activity on development projects outside the core will be worth monitoring. Finally, it's worth noting that the inventory of homes in some of these neighbourhoods (Mary Allen and Uptown West) will remain skinny and command stiff competition due to a healthy buyer pool.
Talking real estate is like talking about the weather, we all do it. Much like the early winter weather of 2019, real estate in Waterloo, Kitchener and area will bring us a few surprises, but the "traditional atmosphere" feels like it's setting in.