Real estate activity in the Southern Georgian Bay region and in other markets across Canada continued to weaken in September marking seven consecutive months of significantly reduced sales activity.
Rising interest rates, inflation and the threat of a recession are the main issues driving the decline in the current real estate market. The sales shift started in March when sales that month were 22% below March of last year, monthly sales June through September have been upwards of 50% below the same months in 2021.
MLS® dollar sales in September of $122.6 million were $107.0 million less than $229.6 million in September 2021 a decrease of 47%.
MLS® unit sales in September of 141 properties were down 45% from September 2021 when 256 sales were reported.
MLS ® dollar sales for the 3rd Quarter (QTR) July Thru September totalled $342.2 million down $307.8 million (47%) for the 3rd QTR of 2021 while 3rd QTR MLS ® unit sales of 404 properties were down by 340 sales (46%) from 744 sales in the 3rd QTR last year.
Total Year-to-date (YTD) MLS® dollar volume of $1.483 billion is now $585 million (28%) below $2.068 billion for the first 9 months of 2021, YTD MLS® unit sales of 1,558 properties are down 37% from 2,485 MLS ® sales in the same period last year.
NOTE: These results are based on total MLS® sales for residential and commercial properties and vacant land in Clearview, Collingwood, Grey Highlands, Municipality of Meaford, the Blue Mountains and Wasaga Beach.
These YTD numbers clearly illustrate how quickly and dramatically the market has shifted starting back in March from the robust conditions we experienced in 2020 thru 2021.
Conversely, new MLS ® listings have been steadily increasing monthly with 472 properties coming to market in September versus 331 in September of 2021, up 141 listings (43%). New MLS ® listings during the 3rd QTR of 1,343 units is an increase of 39% from the 3rd QTR 2021. Further, price reductions which were all but absent the past couple of years have been increasing as well with upwards of 50 price reductions appearing on our local MLS ® System weekly.
After several years of declining inventory with the number of active MLS® listings decreasing annually, the chart above illustrates how the number of active listing is trending upwards in 2022. With sales and prices declining and listings increasing, some Sellers appear prepared to list their properties now rather than waiting 6 months or longer with the risk of attracting a Buyer(s) willing or able to purchase as prices soften and their purchasing power diminishes due to higher mortgage rates.
YTD MLS® single family sales total 1,020 down 37% from 1,624 homes sold last year, condo sales of 285 units are down 40% from 476 last year while vacant land sales of 127 are down 44% from 277 one year ago.
NOTE: The statistics contained herein do not include the sale of new homes and condominiums made outside of the MLS ® system by builders and or developers and their own sales staff nor do they include full time or seasonal rentals.
The YTD MLS® median residential price in September was $804,900 up 13% from $709,200 last year. Worth noting however, September was the 6th consecutive month that the median residential sale price has been trending downward from a high of $918,750 back in February.
The decrease in the median sale price has been partially driven by reduced sales above $1 million causing the median price to decrease in the process. While YTD MLS® single family home sales had been strong at the upper end of the market $1 million and higher over the past 2 years, those segments have slowed as shown in the chart below.
The YTD residential list-to-sale price ratio in September was 99.1% down from 100.2% last year. The list-to-sale price ratio had been steadily declining as the market slows with fewer sales, significantly reduced multiple offers and buyers willing to pay less. Personally, I forecast this trend will continue for the balance of 2022 and well into 2023.
YTD MLS® single family home sales are down in every local municipality: Clearview Twp -42%, Grey Highlands -46%, Meaford -37%, Blue Mountains -30%, Collingwood -28% & Wasaga Beach -40% from the first 9 months of 2021.
With rising interest & inflation rates, a looming recession it is no longer a “Seller’s” market and pricing your property correctly to attract a willing Buyer(s) has become crucial. As a Market Value Appraiser I am the first to admit that pricing in the current market while difficult is possible but it takes research and watching the market statistics such as what I have provided herein. What homes comparable to yours sold for 6 months ago is all but irrelevant. Even the banks are focused on sales in the last 30 days when approving mortgage applications in a effort to reduce their risks in this changing market.
Contact me for expert advice as to what is happening in your specific area of real estate interest how you can best navigate in today’s shifting market. rcrouch@sothebysrealty.ca