Key Things to Remember
Lee Quaile
Broker of Record
Just yesterday our local real estate board released its monthly statistics report for the Kitchener-Waterloo market. The numbers tell a story which will, by now, be familiar to most of you – average sale prices are way up over last year, average time to sell is way down, more listings than ever are being sold each month, and a record number of new listings are appearing every week. Yet inventory continues to be a problem, as demand for housing from buyers still outpaces available supply.
While all the indicators here are pointing to the market remaining incredibly strong and heavily favourable to sellers (both these things are true), there’s some good news hidden in this month’s stats for buyers, too. You just need to know what to look for, and that’s not always readily apparent through a casual glance at the numbers.
The single most important thing to understand is how year-over-year comparisons differ from month-to-month comparisons. In many of the local news pieces sure to surface in the coming days, odds are that you’ll only see one of these sets of comparisons being used. Any year-over-year centred analysis will paint a much gloomier picture for buyers, as the headline is nearly guaranteed to include the 30%-plus increase in the average sale price of all residential properties since May of 2020. By comparison, the month-to-month increase in average sale prices (since April 2021) was only 2.4%.
This difference becomes even more stark when we turn to look at average sale prices for single detached homes. While the year-over-year difference here is 32.6% (a staggering increase by any standard of measurement), since April we’ve actually seen prices fall by 3.4% – the first significant downward trajectory in over a year. While the market remains incredibly strong, the kind of price increases we’ve seen over the past 14 months were never going to continue indefinitely. This leveling out is wholly anticipated and only works to help the long-term stability of our market. While sellers can remain satisfied with the monumental gains the residential market has been enjoying, buyers can also find some relief in knowing that their mortgage pre-approvals won’t be utterly priced out of competition by the next flip of the calendar.
With that, let’s have a closer look at Kitchener-Waterloo’s market stats for May, 2021. As mentioned, average sale prices for all property types climbed by 30.4% over last May, but by just 2.4% since last month – that number now stands at $740,103. The average sale price for single detached homes in Kitchener-Waterloo was $868,990, representing a fall of 3.4% since last month, but an increase of 32.6% since the same time last year. Townhomes also experienced an evening-out in May, with an average sale price of $601,987 being a decrease of 1.8% since April, but an increase of 33.7% since last May. As expected, the market for both semi-detached homes and apartment style condos remained very strong in response to surging demand, with respective average sale prices of $659,975 and $457,935. These represent increases of 36.8% and 38.6% over last year, respectively, and 1.2% and 3.1% over last month’s averages.
Meanwhile, the KWAR set an all-time record for the month of May with a total of 854 residential properties changing hands via its membership. This is well above not only last year’s total (a COVID-impacted 419), but also above the 10-year average of 656. Total new listings added to the market in May tallied 1,061 – but despite this surge of inventory, total available homes at the end of the month stood 70.5% below their 10-year average. This is a tangible indication of demand continuing to outpace supply, and something I don’t see changing for some time to come.
You can read the full KWAR stats report here and, in the meantime, if you have any questions at all I’d encourage you to reach out.
