Uncategorized June 7, 2022

Market Snapshot for month of May 2022

May be an image of text that says 'May 2022| London Ontario MARKET SNAPSHOT MARKET SUMMARY 844 HOMES SOLD 1,436 ACTIVE LISTINGS 9 DAYS ON MARKET 201 CENTURY 21 FIRST CANADIAN UNITS SOLD SOLDY 21 CENTURY AVERAGE PRICE COMPARED To MAY 2021 14.0% +14.3% 13.9% $890,455 LONDON NORTH $750,388 LONDON SOUTH $575,867 $760,880 $645,711 LONDON EAST LUCAN ST.THOMAS CENTURY 21. First sanadian Corp.'

Uncategorized June 3, 2022

May Market Updates

LSTAR’s News Release for May 2022

Inventory Levels Rise, but Prices Remain Elevated

In May 2022, 1,835 new residential listings were posted on the MLS® System of the London and St Thomas Association of REALTORS® (LSTAR), more than in any previous May in the Association’s history. The local housing supply increased from only 1.2 months of inventory in April to 1.7 months of inventory in May.

Sales, on the other hand, were more on par with those from the former decade, with only 844 homes exchanging hands last month in LSTAR’s jurisdiction.

“Even if in May the sales-to-new listings ratio dropped to 46%, a figure that, typically, indicates a market that tends to favour home buyers, benchmark and average prices saw only modest month-over-month declines,” said Randy Pawlowski, 2022 LSTAR President. “Compared to last year’s figures, both of these values are substantially higher,” he added.

LSTAR’s composite MLS® Home Price Index Benchmark Price was down 4% over April, falling from $739,700 in April to $703,300 last month. However, this value is still 17.6% greater than the figure recorded in May 2021. Similarly, LSTAR’s overall average home price decreased from $771,682 in April to $762,397 in May. Compared to the same period last year, this figure is 19.5% higher.

“One of the reasons why we are witnessing this level of stability is the change in population from migration and immigration. Only in the fourth quarter of 2021, Ontario’s population saw a net increase of 34,074 people. Many of these new Ontarians are now looking to buy homes they can afford in regions with good schools and hospitals. And, as it happens, our area checks all these boxes.” Pawlowski explained.

“Aside from the growing population, the existing housing supply is another factor that puts upward pressure on the local home prices. While the months of inventory saw slight increases, they are still at lower-than-usual levels. Normally, a healthy inventory should sit at around 3.5 or 4 months,” Pawlowski said.

The following table shows how May’s average home sales prices in LSTAR’s main regions compare to the benchmark prices for the same areas.

Area May 2022 MLS® HPI Benchmark Price May 2022 Average Price
Central Elgin $718,000 $825,705
London East $570,800 $575,867
London North $840,800 $890,455
London South $699,500 $750,388
Middlesex Centre $990,300 $1,270,684
St. Thomas $597,800 $645,711
Strathroy-Caradoc $875,200 $779,431
LSTAR $703,300 $762,397

Out of the 844 units sold last month, 635 were single-family homes, 105 – condo townhouses, and 65 – apartments.

In May, the average price for a single-family home in LSTAR’s jurisdiction stood at $818,977, that of a condo – at $605,333, and the overall average price for an apartment – at $465,364.

The following table shows the May benchmark prices for all housing types in LSTAR’s jurisdiction and how they stack up against the values from a year ago.

MLS® Home Price Index Benchmark Prices
Benchmark Type May 2022 Change over May 2021
LSTAR Composite $703,300 ↑ 17.6%
LSTAR Single-Family $749,100 ↑ 17%
LSTAR One Storey $681,800 ↑ 17.6%
LSTAR Two Storey $795,300 ↑ 16.8%
LSTAR Townhouse $609,700 ↑ 22.5%
LSTAR Apartment $473,400 ↑ 19.4%

“Even if it’s higher than in many cities from other Canadian provinces, LSTAR’s composite HPI benchmark price places our area among the most affordable in Ontario,” Pawlowski observed. The following chart is based on data provided by the Canadian Real Estate Association (CREA) for May 1st, 2022.

MLS® Home Price Index Benchmark Prices in Canada - May 1, 2022

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Uncategorized June 1, 2022

Bank of Canada Hikes Interest Rates

CANADA

Bank of Canada Hikes Interest Rates And Its Inflation Forecast

Canada’s central bank reiterated its commitment to lower elevated inflation. The Bank of Canada (BoC) hiked the overnight rate and is going ahead with quantitative tightening (QT). It wasn’t much of a surprise, as it was widely expected by the market. What is surprising is the BoC raised its inflation forecast once again. This may indicate they’re even further behind on rate hikes than previously believed.

Bank of Canada Raises Interest Rates By 50 Basis Points (BPS)

The BoC delivered its widely-expected “super” hike today — slang for a 0.5 point hike, double the usual pace. The overnight rate is now at 1.5 points, about 6x the historic low reached as recently as the start of this year. Despite all of the complaints, Canada’s interest rates are still below the 1.75% it started this decade with.

Elevated inflation is driving the need for higher rates, repeated by the central bank. They warned despite rates rising aggressively, it’ll take time to cool inflation. In the meantime, inflation momentum is expected to continue, rising even higher.

“[Consumer Price Index] CPI inflation reached 6.8% for the month of April – well above the Bank’s forecast – and will likely move even higher in the near term before beginning to ease,” said BoC Governor Macklem in a prepared speech.

Much higher rates might be in the cards, with a rising neutral policy rate needed. “The risk of elevated inflation becoming entrenched has risen. The Bank will use its monetary policy tools to return inflation to target and keep inflation expectations well anchored,” said the Governor.

Bank of Canada Raises Its Inflation Forecast

Higher inflation isn’t just a near-term issue but forecasts are climbing too. CPI is forecast to show annual growth of 5.3% in 2022, up from 4.2% in the previous forecast. Next year they anticipate 2.8% growth, up 0.5 points from the previous forecast. That’s within the range of tolerable inflation, but the 3.0% upper bound is less than one revision away.

“With the economy in excess demand, and inflation persisting well above target and expected to move higher in the near term, the Governing Council continues to judge that interest rates will need to rise further,” explains the central bank in the Monetary Policy Report (MPR) that accompanies today’s announcement.

“The pace of further increases in the policy rate will be guided by the Bank’s ongoing assessment of the economy and inflation, and the Governing Council is prepared to act more forcefully if needed to meet its commitment to achieve the 2% inflation target,” reads the BoC report.

Rising rates are expected to dampen what the BoC called “excess demand,” but it might take a while. At the same time, downward revisions are just as likely as upward ones have been, if inflation cools.

Uncategorized May 4, 2022

April 2022 Market Updates

LSTAR’s News Release for April 2022

April Figures Suggest a Soft Landing of the Local Real Estate Market

In April 2022, 877 homes traded hands in the London-St. Thomas area and 1,069 new property listings were posted on the MLS® System of the London and St. Thomas Association of REALTORS® (LSTAR). The local housing supply bounced up to 1.2 months of inventory in April from only 0.6 months in March.

“These figures suggest a soft landing of the local real estate market: the April home sales are on par with the ten-year average and last month’s sales-to-new listings ratio of 54.5% signals that we’re trending towards a more balanced market,” said Randy Pawlowski, 2022 LSTAR President.

Within the same time frame, LSTAR’s composite Home Price Index Benchmark Price saw a 4.5% month-over-month decline – from $774,200 in March to $739,700 in April. A similar difference was also seen in LSTAR’s overall average home price, which decreased from $823,954 in March to $771,682 in April.

“There is nothing dramatic about the decline in home prices. These single-digit decreases were actually expected after two consecutive interest rate hikes by the Bank of Canada and the Ontario Government’s decision to expand and increase the non-resident speculation tax,” Pawlowski explained.

The following table shows how April’s average home sales prices in LSTAR’s five main regions compare to the benchmark prices for the same areas.

Area April 2022 MLS® HPI Benchmark Price April 2022 Average Price
Central Elgin $773,000 $900,732
London East $647,600 $597,652
London North $863,900 $874,712
London South $731,900 $772,829
Middlesex Centre $1,076,700 $1,192,683
St. Thomas $628,100 $688,116
Strathroy-Caradoc $825,500 $823,380
LSTAR $739,700 $771,682

Out of the 877 units sold last month, 648 were single-family homes, 121 – condo townhouses, and 74 – apartments.

“In April, the average price for a single-family home in LSTAR’s jurisdiction sat at $840,415, that of a condo – at $618,049, and the overall average price for an apartment – at $476,283,” Pawlowski said. “Speaking of apartments, it’s interesting to see that their HPI benchmark price increased in April by 3.7% over the previous month, while the benchmark prices for all the other home types saw month-over-month single-digit reductions,” he noted.

The following table shows the April benchmark prices for all housing types in LSTAR’s jurisdiction and how they measure up to the values from a year ago.

MLS® Home Price Index Benchmark Prices
Benchmark Type April 2022 Change over April 2021
LSTAR Composite $739,700 ↑ 25.1%
LSTAR Single-Family $789,700 ↑ 23.7%
LSTAR One Storey $742,500 ↑ 26.6%
LSTAR Two Storey $838,300 ↑ 21.8%
LSTAR Townhouse $599,900 ↑ 26.1%
LSTAR Apartment $461,400 ↑ 37.0%

“Even if it’s much higher than in many cities from Alberta and Saskatchewan, LSTAR’s aggregate HPI benchmark price places our area among the most affordable in Ontario,” Pawlowski observed. The following chart is based on data provided by the Canadian Real Estate Association (CREA) for April 1st, 2022.

HPI Benchmark Home Prices Across Canada - April 2022
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Uncategorized April 4, 2022

March Updates

LSTAR‘s News Release for March 2022

March Sees Record Number of Listings, but Inventory Remains Low

1,049 homes were sold in March 2022 in the London-St. Thomas area via LSTAR‘s MLS® System. During the same time frame, 1,544 listings came on the local market, which makes last month the March with the highest number of listings in the history of the London and St. Thomas Association of REALTORS®.

“Despite the record number of listings, our inventory – the number of active listings at month end – saw just a slight increase from last month, creeping up from 0.5 months to only 0.6,” said Randy Pawlowski, 2022 LSTAR President. “The sales-to-new-listings ratio for the entire jurisdiction of LSTAR was 67.9%, much lower than a year ago, but still indicating a Sellers’ market,” he continued. “The latest interest rate hike by the Bank of Canada may have put a damper on what has been so far a truly fierce competition among local home buyers,” he explained.

In March, the overall average price for all home types in our area was $823,954, whereas LSTAR‘s composite MLS® Home Price Index Benchmark Price sat at $774,200. “These figures suggest that the pace of home price gains might have started to slow down in our area,” Pawlowski said. “It’s way too early to predict the impact of this new measure, but Ontario Government’s recent decision to increase the non-resident speculation tax to 20% and expand it throughout the whole province might also help tame home prices,” he added.

The following table shows how March’s average home sales prices in LSTAR‘s five main regions compare to the benchmark prices for the same areas.

Area March 2022 MLS® HPI Benchmark Price March 2022 Average Price
Central Elgin $826,600 $927,880
London East $685,600 $669,005
London North $894,800 $947,700
London South $770,100 $823,904
Middlesex Centre $1,085,800 $1,228,124
St. Thomas $665,200 $728,860
Strathroy-Caradoc $869,200 $860,138
LSTAR $774,200 $823,954

Out of the 1,049 units sold last month, 756 were single-family homes, 140 – condo townhouses, and 107 – apartments.

“In March, the average price for a single-family home in LSTAR‘s jurisdiction sat at $894,306, that of a condo – at $692,187 and the overall average price for an apartment – at $501,961,” Pawlowski said. “Regarding condo townhouses, it’s interesting to see how well they are selling and how much their benchmark price has appreciated in the last year: last month was LSTAR‘s second-best March for condominium sales and the MLS® HPI benchmark price for a local apartment has grown by 49.7% over a year ago,” he noted.

The following table shows the March benchmark prices for all housing types in LSTAR‘s jurisdiction and how they compare with the values from a year ago.

MLS® Home Price Index Benchmark Prices
Benchmark Type March 2022 Change over March 2021
LSTAR Composite $774,200 ↑ 35.9%
LSTAR Single-Family $831,100 ↑ 33.4%
LSTAR One Storey $777,900 ↑ 40.1%
LSTAR Two Storey $884,700 ↑ 29.3%
LSTAR Townhouse $638,700 ↑ 49.7%
LSTAR Apartment $445,100 ↑ 36.5%

“The latest figures achieved by LSTAR‘s HPI benchmark prices and average sale prices place our area somewhere in the middle of the Canadian home affordability scale,” Pawlowski observed. The following table is based on data provided by the Canadian Real Estate Association (CREA) for March 1st, 2022.

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Uncategorized October 15, 2021

September Sales updates

LSTAR’s News Release for September 2021

LSTAR Home Sales on Track for a Record Year

In September 2021, the London and St. Thomas Association of REALTORS® (LSTAR) experienced another solid month, with 864 residential transactions recorded via its MLS® system. “This value, which represents the second-highest number of homes sold in the month of September in LSTAR’s jurisdiction since 1978, puts us on track for a record year. In the first nine months of this year, 8,756 homes traded hands in our area, which is an unprecedented total for our September year-to-date figures,” said 2021 LSTAR President Jack Lane.

1,057 new listings came on the local market last month, on par with the values seen in the pre-pandemic years. However, at the end of the month, there were only 628 active listings left – the lowest amount of active listings ever seen by LSTAR in September. “These figures show clearly that houses in our area are in very short supply. The shortage is also demonstrated by the very low number of months of inventory – 0.6, which indicates that, at the current sales pace, it would take only a  bit over two weeks to liquidate the entire existing housing inventory of LSTAR,” explained Lane.

Both benchmark and average sales prices continued to rise last month. In September, the overall average home price for LSTAR was $690,861, while the LSTAR composite MLS® HPI benchmark price sat at $596,400.

The following table shows how September’s average sales prices compare to the benchmark prices. The MLS® Home Price Index (HPI) benchmark price reflects the value of a “typical home” from a specific area as perceived by local home buyers based on various housing attributes. The average sales price is calculated by adding the sale prices for all the homes sold and dividing that total by the number of transactions. Since monthly averages may be skewed by the type of houses sold in that timeframe, the HPI benchmark price is a more accurate way to gauge price trends.

Area September 2021 MLS® HPI Benchmark Price September 2021 Average Price
Central Elgin $620,600 $613,571
London East $516,300 $505,641
London North $711,400 $752,925
London South $588,100 $658,973
Middlesex Centre $876,900 $921,217
St. Thomas $504,700 $526,599
Strathroy-Caradoc $698,100 $638,078
LSTAR $596,400 $690,861

“Aside from prices, when analyzing the market activity in LSTAR’s five main regions, we are also looking at the median number of days on market recorded in each region. This number reveals how many days it usually takes to sell a home in a certain area. Except for Elgin, this number was between 7 and 8 days,” Lane added.

The single-family home remains on top of the local buyers’ preferences, with 648 sales in September. “Yet, it is worth mentioning that, so far, both condo townhouses and apartments had their best year ever, with 1,087 and 812 units respectively exchanging hands year-to-date,” Lane noted.

The table below shows the September benchmark prices for all housing types in LSTAR’s jurisdiction and how they stack up against the values from a year ago.

MLS® Home Price Index Benchmark Prices
Benchmark Type September 2021 Change over September 2020
LSTAR Composite $596,400 ↑ 31.7%
LSTAR Single-Family $644,900 ↑ 33.6%
LSTAR One Storey $600,200 ↑ 34.6%
LSTAR Two Storey $689,500 ↑ 33%
LSTAR Townhouse $479,600 ↑ 32%
LSTAR Apartment $336,200 ↑15.5 %

“Despite all the surges we witnessed in the HPI benchmark prices and average sales prices, homes in LSTAR’s jurisdiction remain relatively affordable when compared to houses from some other major Ontario and  Canadian centres,” Lane emphasized.

The following chart is based on data taken from the CREA National Price Map for August 2021.

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Uncategorized May 4, 2021

London & St Thomas April Market

LSTAR’s News Release for April 2021

Home Sales Remain Strong in April

The London and St. Thomas Association of REALTORS® (LSTAR) announced 1,231 homes exchanged hands last month, the highest number of home sales recorded via the MLS® system for the month of April since the Association began tracking data in 1978.

“We are encouraged by the strong sales numbers, as the spring market ramps up,” said LSTAR 2021 President Jack Lane. “Year-to-date sales are also performing ahead of 2020. At the end of April, there have been 3,918 sales, up more than 57% over the same period last year.”

LSTAR’s regions, like many others across the province, are experiencing some of the lowest inventory levels seen in the past 10 years. Combined with a high demand, these dynamics have contributed to a very robust marketplace, with numerous situations of multiple offers and properties being sold for considerably more than their listing prices.

“It’s important for the public to understand that every transaction is different, based on housing type, housing features, geographical location and many other factors,” Lane said. “Each transaction is unique and does not necessarily represent activity across the entire marketplace.”

The following table shows last month’s MLS® Home Price Index (HPI) benchmark prices by area and how they compare to the average sales prices. The HPI benchmark price reflects the value of a “typical home” as assigned by buyers in a certain area based on various housing attributes, while the average sales price is calculated by adding all the sale prices for homes sold and dividing that total by the number of homes sold. Since averages may be affected by the monthly changes in the mix of sales activity, the HPI benchmark price is a more accurate way to gauge price trends over time.

Area April 2021 MLS® HPI Benchmark Price April 2021 Average Price
Elgin $595,200 $641,366
London East $505,700 $508,158
London North $696,700 $755,102
London South $570,200 $650,472
Middlesex $859,700 $881,011
St. Thomas $490,900 $541,255
Strathroy $691,700 $633,280
LSTAR $583,400 $643,835

“The pandemic has added another layer to managing the home selling and buying process,” Lane said. “We understand the challenges many potential home buyers are going through right now. A local REALTOR® is always going to be your best resource to help you navigate through this marketplace.”

The single-family home maintains its place as the most popular housing type sold, with 913 sales in April. The table below shows the April benchmark prices for all housing types and how they stack up against the values from a year ago.

MLS® Home Price Index Benchmark Prices
Benchmark Type April 2021 Change over April 2020
LSTAR Composite $583,400 ↑ 42%
LSTAR Single-Family $640,300 ↑ 47.3%
LSTAR One Storey $586,300 ↑ 46.9%
LSTAR Two Storey $701,600 ↑ 47.5%
LSTAR Townhouse $444,500 ↑ 32.1%
LSTAR Apartment $295,400 ↑ 6.9%

Despite increases to the HPI benchmark price and average sales price, homes in LSTAR’s jurisdiction continue to remain relatively affordable when compared to houses from some other major Ontario and Canadian centres. The following table is based on data taken from the CREA National Price Map for March 2021.

HPI Benchmark Home Prices Across Canada - March 2021