John M. Kacmar, Broker
Chestnut Park Real Estate Limited, Brokerage
I am delighted to offer you up to date market statistics and insight into the trends that drive the real estate industry. I hope this information will allow you to analyze the marketplace that you are buying or selling in and make the best decision for your circumstances. - John
The pace of the market in October remained steady and calm with well-priced properties selling relatively quickly, and over-priced homes languishing on the market. Most Buyers were willing to make reasonable offers but wouldn’t be swept up in the emotional roller coaster of last spring. However, with many potential Sellers seemingly holding off listing until the New Year when they expect to see more robust conditions, the inventory remained at record lows, and many Buyers appear to be waiting in the wings for the right home to hit the market at the price they are prepared to pay.
There is no denying that sales are indeed down from last year, in fact 20% year over year with 203 sales reported in October 2017 compared to 254 sales reported in October 2016. Of the 203 sales, 185 sales represented residential properties and 18 sales represented farm, vacant land and commercial properties. Year to date (“YTD”) sales were down 12% with 2135 sales reported by the end of October 2017 compared to 2437 in October. But, as stated, this trend should not be attributed exclusively to a decline in demand. Rather a variety of forces appear to be at play including lack of inventory and rising prices along with the availability of many new home development options in the trading area which are not sold through, or recorded on the MLS® System.
Contributing to the low inventory is the chronic scarcity of new listings. 251 new listings were reported in October 2017 versus 278 in October 2016 showing a 10% decline year over year. And last year was significantly down from the year previous when 301 new listings were reported in October 2015. Year to Date (YTD) new listings were down 11% year over year with 3195 new listings reported by the end of October 2017 compared with 3592 that same time last year.
Despite fewer sales reported year over year, the average price of a single family residential home in the Western Region showed a strong increase of 26% from $477,590 in October 2016 to a whopping $601,615 in October 2017 contributed to, at least in part by the rise in the number of sales in the higher price points. In fact, sales of properties in all categories ranging from $700,000 to $2,999,999 either equalled or exceeded those the year previous, with sales numbers in the $700,000 - $1,749,000 range actually tripling, jumping from 10 sales in 2016 to 31 sales in 2017.
Given the spike in sales of higher priced properties it’s not surprising that the Total Sales Dollar Volume for October 2017 was up 5% over October 2016, despite the 20% decline in sales which took place for the most part in the lower price ranges. And, given the strong market performance throughout the year and especially experienced in the spring of 2017, the Total Sales Dollar Volume YTD was up 8% year over year.
Overall, the average price of a residential single family home in all municipalities across the Western Region was up year over year. The YTD average sale price in Collingwood in October 2017 was up 19.1%, $510,203 vs $428,515 in October 2016. The number of sales in Collingwood YTD was down 14.2% year over year. The Blue Mountains boasted a substantial 30.9% increase in average sale price YTD, $830,611 vs $634,681 year over year, making it the highest average sale price in the Western Region. Consistent with that and SGBAR’s sales statistics highlighting the surge in activity amongst higher priced properties, The Blue Mountains was the only area in the Western Region to show an increase in the number of sales for the month of October with a 1.6% increase in the number of homes sold in October 2017 vs October 2016. YTD, prices were up 22.2% in The Municipality of Meaford with October 2017 reporting an average sale price of $420,844 vs $344,332 in October 2016. The number of sales decreased 27.5% year over year. Grey Highlands reported a significant 28.5% jump year over year, with the October 2017 price coming in at $615,005 vs $478,674 in October 2016. Sales were down 6.5%. Clearview saw a 16.7% increase in the average price, $559,991 over $479,784 year over year with a 25.7% decrease in the number of homes sold 2017 vs 2016. YTD, Wasaga Beach was up 23.6%, with the average sales price reported at $426,787 over $345,249 for October 2016. Sales were down 23.9% year over year.
The Sales-To-Listings Ratio is an important measure of the overall health of the real estate market and the balance between housing supply and demand. In October 2017, SGBAR calculated and recorded the ratio between the number of sales and new listings coming onto the market as 80.88, the highest it has been in any month in 2017 confirming that the SGBAR Western Region remained solidly in the grips of a tight Seller’s market. Notwithstanding that, this figure still marks a drop from the 91.37 sales to new listings ratio recorded in October 2016, a testament to the frenzied market of one year ago and confirming that conditions have in fact cooled and moderated from last October.
Finally, and consistent with the above, the seasonally adjusted “Months of Inventory” for the area came in at 2.8 at month’s end. This number represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity. While still indicative of a healthy and comparatively tight market, it is evidence of a cooling of sorts and pull back from the 2.2 months recorded one year ago.
October saw stability and good momentum with less frenzy and drama from a year ago. The implementation of new stress tests for conventional mortgages effective January 1st, , 2018 may prompt some Buyers to jump into the market before year end, but with limited inventory and pressures on affordability, opportunities may be limited.
Prepared by Diana Lea Berdini, Broker/Office Manager Collingwood/Owen Sound
Chestnut Park Real Estate Limited, Brokerage
These statistics are compiled using data from the MLS® system of the Southern Georgian Bay Association of REALTORS®