Post-pandemic price corrections could be catalyst for more residential movement

Official release from Lakelands Association of REALTORS with notes and edits by Chris O.

The numbers are backing up what many realtors we’ve spoken to over the past few months have predicted: the market has an optimistic outlook after a holding pattern and downward trends in late 2022 and early 2023.

Having interviewed many realtors for Dockside and Lakeside Magazine articles in the past few months, there was definitely a positive view on where the market was headed, particularly in Muskoka.

The most recent numbers from The Lakelands Association of Realtors seems to back that up with a 6.1% gain year-over-year in May for residential non-waterfront sales activity.

However, residential non-waterfront sales were still 6.4% below the five-year average and 12.6% below the 10-year average for the month of May.

Sales of waterfront properties numbered 149 units in May 2023. This was a slight gain of 0.7% (one sale) from the same period in 2022. Still, waterfront sales were 20.5% below the five-year average and 27.8% below the 10-year average for the month of May.

These numbers are representative of homes and cottages being sold through MLS listings and realtors.

“Non-waterfront home sales took the lead in May, posting the first year-over-year increase in exactly two years, while sales of waterfront properties were flat compared to the same month last year,” said Matthew Lidbetter, President of the Lakelands Association of Realtors, in an official statement. “We may have to wait until warmer weather for the waterfront segment to heat up, although demand is outpacing supply in that area as evidenced by the surge in median price for waterfront properties, which was back up above $1 million in May.”

As well, many of our realtor friends indicated a price correction would occur in the market to offset the final pandemic pricing surge – which happened just before interest rate hikes by the Bank of Canada were announced.

The MLS Home Price Index (HPI) tracks price trends far more accurately than is possible using average or median price measures. The overall MLS HPI composite benchmark price was $715,000 in May 2023, down by 12.8% compared to May 2022.

The benchmark price for single-family homes was $743,600, a decrease of 12.8% on a year-over-year basis in May. By comparison, the benchmark price for townhouse/row units was $572,100, a reduction of 13.9% compared to a year earlier, while the benchmark apartment price was $468,200, a decline of 10.5% from year-ago levels.

The median price for residential non-waterfront property sales in May 2023 was $695,000, a decline of 6.1% from May 2022.

The more comprehensive year-to-date residential non-waterfront median price was $685,000, down by 13.2% from the first five months of 2022. The median price for waterfront property sales in May 2023 was $1,085,000, a gain of 6.6% from May 2022.

The more comprehensive year-to-date waterfront median price was $961,250, down by 16.4% from the first five months of 2022. The total dollar value of all residential non-waterfront sales in May 2023 was $400.9 million, a decrease of 4.3% from the same month in 2022.

The total dollar value of all waterfront sales in May 2023 was $218.4 million, a small gain of 3.2% from the same month in 2022.

LAKELANDS BOARD & ASSOCIATION INFORMATION

The Lakelands Association of Realtors represents more than 1,550 realtors in several major geographical areas.

Lakelands West: The Blue Mountains, Clearview, Collingwood, Grey Highlands, Meaford, Wasaga Beach.

Lakelands Central: Midland, Orillia, Oro-Medonte, Penetanguishene, Ramara, Severn, Springwater, Tay, Tiny.

Lakelands North: Algonquin Highlands, The Archipelago, Bracebridge, Dysart et al, Georgian Bay Township, Gravenhurst, Highlands East, Huntsville, Lake of Bays, Minden, Muskoka Lakes, Parry Sound.