While the Kitchener-Waterloo real estate market has returned to more halcyon days, average home prices in the area continue to rise.
Home sales in the area fell dramatically over the first six months of 2018, according to figures recently released by the Kitchener-Waterloo Association of Realtors (KWAR). Over the period, there were 3,096 homes sold, a decrease of 19.1 per cent from the first half of 2017.
Part of the reason for the increase in price could be a lack of available product on the market. There were 850 homes put on the market in June, which is just below the historical average (859), but a 21.5 per cent decrease over June 2017.
“I think we are at two-thirds of normal, so it is still a seller’s market,” KWAR president Tony Schmidt said.
There were 1,030 homes in KWAR’s MLS system in June, well below the 10-year average of 1,728.
This is not a positive scenario for homebuyers.
“More stock allows for more options,” Schmidt noted.
Still, the number is 11 per cent higher than it was in 2017, a market which was horrid for homebuyers.
“The last two years were a feverish unsustainable pace,” he said. “It needed to come back.”
Schmidt says the current pace of the market is a little more favourable to buyers, who were forced in 2017 to present unconditional offers to keep competitive.
“People that are buying now have the opportunity to have a conditional offer,” Schmidt said.
“The conditions help to protect buyers,” he explained, noting that in most cases, buyers can return to a situation in which they are allowed to get home inspections before they fully commit to making a purchase.
While the prices are still rising, it is not moving at the feverish pace of 2017. The average time span it took to sell a home in June was 22 days, compared with 16 days in June 2017.
While some believe the hot market was a real estate agent’s dream, Schmidt said that was not actually the case.
He says that real estate agents were having to relearn the market on a monthly basis in order to adjust to the new realities of the situation.
“It was a very accelerated learning curve,” he said, adding it is in a much “healthier state” now.
Some of that market was driven by people looking to escape the higher prices in the Toronto area. Others may be just taking advantage of a morphing job market that allows people to commute less as they work from home more.
“I really believe that we got discovered,” he said, noting how much more buyers can get for their buck than in Toronto.
While there are no numbers available to track out-of-market buyers, Schmidt believes there is still an influx of people into the Kitchener-Waterloo market.
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