About Waterloo County, ON

I attended a presentation this morning by a Market Analyst from Canada Mortgage and Housing Corporation entitled 2008 Housing Market Outlook. I just thought I'd summarize the highlights from my notes. I apologize that I didn't keep track of the exact numbers, but the main points are bulleted below.

• Interest rates remain very low. This is what has been and is continuing to drive the Canadian real estate market.
• Low interest rates combined with flexible mortgage products (low money down, long amortizations) keep home ownership affordable.
• Local employment continues to be strong and diverse. Job growth is still increasing, but slowing. Manufacturing sector has been negatively affected by US economy and low US Dollar. The KW area is well situated and our industry base remains diverse and stable. We have a young educated work force and a strong high-tech sector.
• Consumer confidence is declining.
• Positive population growth due, in part, to in-migration, is 4th highest in Ontario.
  1. Barrie
  2. Oshawa
  3. Toronto
  4. Kitchener
  5. Guelph
  6. Brantford
• Relatively low house prices are driving migration from Toronto to Kitchener.
• 50% of people surveyed who intend to buy real estate in the next year, intend to buy a resale home. Of those intending to buy a resale home, more than 50% intend to buy a single family home.
• CMHC PREDICTS A 6.2% AVERAGE PRICE INCREASE IN 2008 OVER 2007.
• CMHC PREDICTS A 4.7% DECREASE IN THE NUMBER OF UNITS SOLD IN 2008 OVER 2007.

In order to provide some context for these numbers I offer the following:

• RE/MAX Ontario-Atlantic Canada predicts a 5% average price increase for 2008 over 2007.
• My own analysis of MLS (R) data shows a 5.3% average price increase year-to-date over 2007.
• Although average prices did declined in 1991, 1992, 1993, 1995 and 1996, prices have increased an average of 3.4% per year since 1988.
• 6808 residential units sold in all of 2007. 876 have sold year-to-date 2008 vs. 890 year-to-date 2007.
• Anecdotally, I am observing an increasing number of price reductions on active listings as well as increasing days-on-market for recently sold listings. This would appear to point to a changing market.

Prices appear to be levelling off, but it appears that average prices are not expected to decrease in the immediate future. An increase of 5-6% for local house prices in 2008 overall would seem to be consistent with the opinions of government and industry experts. Also consistent with these opinions is a modest decline in the number of properties to be sold in 2008.

For an up-to-date market evaluation and a detailed analysis of how market forces are affecting your real estate choices, call me today.

Well, 2008 is off to a great start! Sales of residential properties in Kitchener-Waterloo and area last month mirrored January 2007 results, positioning the local real estate market for another strong sales year.

There were a total of 381 residential sales last month recorded on the MLS® system of the Kitchener-Waterloo Real Estate Board, just over the 379 homes sold in January 2007. Relative to December 2007, sales jumped more than 25 percent last month.

Sales results in January point to continued market strength. While the market may be poised to keep pace with the record-setting sales of 2007, it is too soon to forecast whether last year's results will be matched or exceeded.

Higher-priced homes continued to sell well last month, with 35 properties selling for more than $400,000, compared with 19 sales one year ago. Sales results across other price ranges showed varying degrees of strength, with mixed results being reported for some price ranges, largely due to a decline in the sale of single family detached properties relative to January 2007. Sales of condominiums in January were particularly strong with 67 sales marking a 56 percent increase.

The total dollar volume of residential properties purchased last month was $100 million, up 8.3 percent from last January, resulting in higher average sale prices. Overall, the average sale price of all residential properties sold last month jumped 6.1 percent to $263,860.

While January saw a slight increase in new listings, the overall supply of residential properties available for sale was down almost 20 percent relative to January 2007 to 1,553 active listings. There is currently a 4 month supply of homes on the market.

Solid residential sales in January continue the healthy market that home buyers and sellers have enjoyed for the past 10 years. The results for the month set the stage for strong sales in 2008.

The 6,808 homes sold in Kitchener-Waterloo and area last year set a new record for total annual sales in the history of the Kitchener-Waterloo Real Estate Board. Last year's results were the continuation of a steady climb in sales since 1990 (3,501 total sales).

Dollar volume of all residential real estate sold last year jumped almost twenty percent to $1.7 billion compared with 2006, reflecting continued strong consumer confidence in the local real estate market.

The volume of sales in price categories above $200,000 experienced the greatest increases. The greatest percentage sales increase was for homes selling for $750,000 to $1 million. The most active market segment was for homes selling in the $200,000 to $250,000 price range.

Despite the record unit sales for the year, sale price increases were relatively tempered. The average sale price of all residential real estate sold in 2007 increased 5.6 percent to $248,879. Single family detached homes sold for an average price of $283,080 last year, an increase of 5.2 percent.

Despite strong consumer demand for higher-priced properties, the supply of homes for sale remained constant, with 9,646 new listings this past year topping the supply of homes for sale in 2006 by just four properties.

Tania Benninger, President of the Kitchener-Waterloo Real Estate Board says, "Home sales in 2007 were strong throughout the year as consumer interest went unabated. The strong sales performance locally reflects strong residential sales throughout Ontario and across Canada." Benninger noted that sales throughout 2007 have been strong across all price categories above $200,000, a trend that is likely to continue into 2008. While the sale of single family detached homes continues to drive the market, sales of townhouses, condominiums and semi-detached houses all experienced strong growth in 2007 as well.

Continued affordability, low interest rates and a dynamic local economy that has produced the highest employment rate in the country have created a market with a strongappetite for home ownership.

Welcome to my renewed Kitchener-Waterloo Real Estate Market blog. Check back here often for my insights and observations of the real estate market and industry. I hope to update this site weekly.

Its my goals for this blog are:

1. To keep my clients, customers and friends informed about our local real estate market and trends.
2. To provide useful information to my clients, customers and friends regarding care, maintenance and protection of their real estate investments.
3. To provide information to my clients, customers and friends that will help them make good financial and investment decisions regarding their real estate investments.
4. To provide referring agents and relocating clients information about my community and market place.

Feel free to post and send comments as your feedback is really key to the success of this experiment.

I wish everyone a productive and prosperous 2008!