St. John’s Real Estate Market Posts Strong First Quarter in 2010

May 17, 2010 · Filed Under CMHC Reports, Market Trends and St. John's Real Estate · Comment 

Historically low mortgage rates, combined with strong economic and demographic trends, buoyed local demand for housing in the first quarter of this year.  January to March housing starts posted record results, while existing home sales and prices both continued to advance.

Overall, the St. John’s real estate market was supported by growth in  employment,  income and population, healthy consumer spending and on-going economic momentum spurred by the local oil sector.

Residential construction activity posted record results during the January to March period, due in part to an unseasonably mild winter.  New home prices also advanced in line with  the general market trend.  First quarter housing starts activity increased 15 per cent, with 246 starts versus 214 in 2009’s first quarter.  Single-detached starts increased by 23 units  or 20 per cent, with 199 starts recorded versus 166 during the first three months of last year.

The multiple starts segment was flat, with 47 starts during the quarter compared to 48 a year ago.  The only sub-market which reported increased construction activity was the St. John’s City submarket during the January to March period (104 starts compared to 88 a year ago), with Mount Pearl posting 15 starts versus 17 during 2009’s first quarter and Paradise recording 62 versus 65 a year ago.  Conception Bay South (CBS) recorded 22 starts in the first quarter, consistent with 2009’s first quarter while starts in Torbay remained flat after this first quarter with 14. In the remainder of the CMA, starts increased from eight in the first three months of 2009 to 29 this year.

Price growth continued, with the average new house price increasing in all submarkets. In fact, the average price of a new home surpassed the $325,000 mark in St. John’s City and the $350,000 mark in Torbay. Average sales price ($354,333) and average sales growth (26.4 per cent) were highest in the Torbay submarket of the St. John’s CMA. The average new single-detached house price for the overall St. John’s CMA increased nearly 20 per cent to a record $311,638 compared to $259,990 during the first quarter of 2009. CBS  posted the lowest average new house price of $248,328 during the quarter. Paradise had the second highest rate of new house price growth in the first quarter at 25.1 per cent to  $333,388.

Throughout the St. John’s area, approximately 47 per cent of all new construction activity fell within the $300,000 plus range during the quarter.  The largest growth in market share occurred in the $400,000+ segment.  Overall, new home price growth remained brisk throughout the quarter.

SOURCE: CMHC Housing Now St. John’s CMA

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Newfoundland MLS Trends for 4th Quarter 2009

January 28, 2010 · Filed Under CMHC Reports, Market Trends and St. John's Real Estate · Comment 

CMHC just released their latest Housing Market Information statistics for the Newfoundland real estate market today.  Here is a basic breakdown from the report:

MLS® Residential Sales Increase During Fourth Quarter

  • MLS® sales increased 7.5% to 1,293 compared to 2008’s fourth quarter sales of 1,203.
  • October, November and December MLS® sales were 473, 421 and 399, respectively.
  • Fourth quarter average MLS® residential house price climbed 10% to $212,992 compared to $193,529 during the fourth quarter of 2008 – the only consistent price growth market in Canada since 2008.

Sellers Market Conditions

  • 1,257 new residential listings during the 4th quarter compared to 1,463 during the same period in 2008.
  • Active listings or inventory averaged 1,542 from October to December versus a similar 1,528 during Q4 of  2008.
  • Sales-to-active listings ratio hit 34% in December and averaged 29% during the fourth quarter versus 26% in Q4 of 2008.

Sellers Market Keeps Active Listings Low

  • Steady demand for housing caused active residential listings to remain low during the fourth quarter.
  • Active listings for October, November and December were 1,790, 1,643 and 1,192, respectively, with new listings of 601, 416 and 240, respectively.
  • Steady demand paired with 7.5% more sales and 14% fewer new listings resulted in sellers market conditions.

Mortgage Rates

  • Canadian mortgage rates are expected to remain historically low during the first half of 2010 and increase gradually during the second half, as bond yields start to increase.
  • For 2010, the posted 5-year mortgage rate is expected to be in the 5.49% to 6.0% range.
  • The record low bank rate currently sits at 0.25%, with prime at 2.25% and 5-year fixed mortgage rates at 5.49% at major Canadian banks.

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MLS Listing Sales down – St. John’s housing prices up

July 22, 2009 · Filed Under CMHC Reports and Market Trends · 1 Comment 

MLS sales retreated 8% to 996 units compared to 2008’s second quarter sales of 1,084 units.  April, May and June MLS sales were 259, 316 and 421, respectively. Despite the drop in sales, second quarter average MLS prices for St. John’s and surrounding areas up 20% to $203,854 compared to $169,942 during the second quarter of last year.  This is the only consecutive price growth in Canada since the fourth quarter of 2008.q2buyersmarket

Sales-to-active listings ratio increased to 19.6% in June and averaged 16.4% during Q2, indicating the market favouring buyers, particularly in April and May. However, as you can see from the chart, we are swinging upwards and my estimate we’ll see a balanced market for the third quarter. The St. John’s real estate market actually feels like a balanced market now.

The Bank of Canada left the prime lending rate at 0.25% the other day.  However mortgage rates are predicted to drift higher in 2010.

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Canadian Real Estate Outlook for 2009

January 6, 2009 · Filed Under Market Trends and Real Estate Canada · 1 Comment 

Business News Network (bnn.ca) had an interview this morning with Phil Soper, President and CEO of Royal Lepage Real Estate Services discussing the Canadian Real Estate Outlook for 2009.

Historically low interest rates, stable local economies and increasing affordability should support Canada’s residential real estate market during transitioning period.

He stressed that we will see a correction in 2009 and not a crash like we are seeing in the US.  Nationally the real estate market peaked in the 4th quarter of 2007 so we are 4 quarters into the “correction” already.

His prediction is a 3% decrease nationally with higher decreases in the bigger cities such as Toronto and Vancouver which will see 4% and 9% declines respectively. Halifax is expected to remain relatively flat with a 1% gain. (Side note: the St. John’s real estate market was not mentioned)

He basically went on to say that the first quarter will be a difficult quarter but will recover in the second half of ’09.  I feel that this will be the trend with the Newfoundland market as well.

Mortgage rates are still at all time lows and he pointed out that most buyers are not overly concerned with the “sticker price” on a property but are more concerned with the monthly mortgage payments.

Read the full press release Correction, not crash for Canadian real estate market in 2009; Average house prices forecast to fall 3.0 per cent

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St. John’s Real Estate outlook for 2009

January 5, 2009 · Filed Under First Time Buyers, Market Trends, St. John's Investments and St. John's Real Estate · Comment 

The first week of business for 2009,for me anyways, and already people are asking the million dollar question….where will the housing prices be in 2009?

As in most years, it’s difficult to predict.  Last year CMHC predicted 6% and RE/MAX stated at least 12%.  I remember saying after the first quarter we’ll see much higher then 12%.  The final tally for 2008 is not yet in but should be close to 23% in my opinion.

Now….where do I see the St. John’s real estate market for 2009.  Currently my mind is set at a 5% increase from 2008.

How can I say this with the US housing market expecting to drop even more, Canadian markets are predicted to lower in some areas, and the UK, no real direct relation, but the world housing market seems to be taking a hit right now.  It all boils down to consumer confidence, the provincial economy and a balanced market.  All three we are seeing in Newfoundland currently.

There are still a lot of sale pendings left over from 2008 that will help keep the numbers up for unit sales in 2009, but there is clear evidence that it’s no longer a seller’s market.  With mortgage rates still at VERY low levels, as well as increased inventory in new construction and pre-existing homes, this will leave more choices for buyers.

Personally I do not see the market going into the negative numbers, but I do see houses sitting longer on the market and “price reduced” signs being more familiar then “sold signs”.

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A Little Real Estate humor

June 24, 2008 · Filed Under Real Estate Humor · Comment 

In the mist of the busy real estate in St. John’s this June I have slipped away from my blog postings.  I have learned in busy times it’s good to maintain some humor throughout the day.  Here are some “corny” quick laughs.

- Realtor sign–We have “lots” to be thankful for.

- I listed a maintenance free house. In the last 25 years there hasn’t been any maintenance.

- (Q) Did you hear about Robin Hood’s house? (A) It has a little John.

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MLS Trends St. John’s First Quarter

April 17, 2008 · Filed Under First Time Buyers, Market Trends, Monthly MLS Stats, St. John's Investments and St. John's Real Estate · 1 Comment 

MLS Residential Sales Post Solid First Quarter

  • MLS® residential sales increased 14.3 per cent to 713 units compared to last year’s first quarter sales of 624 units
  • January, February and March MLS® sales were 236, 238 and 239, respectively and were held back by a lack of active listings
  • Driven by low inventory, the first quarter average MLS® house price jumped 13.6 per cent to a record $156,953 compared to $138,167 during the first quarter of 2007

Resale Market Classified as Sellers

  • The resale market headed quickly to a sellers classification last Fall and remained there throughout the first quarter of 2008
  • Average time-on-market trended lower during the quarter, strong price growth continued and many choice properties enjoyed multiple purchase offers
  • Current trends indicate the market will favor sellers once again during the second quarter, but an expected improvement in active listings may provide some relief for buyers

Active Listings Remained Low

  • After falling nearly a half by January, active listings rebounded slightly during February and March, but remained low, restricting unit sales growth accordingly
  • The supply of active residential listings averaged approximately 1,150 during the first quarter compared to almost double that number at 2,100 a year ago
  • First quarter new listings were near last year’s first quarter level of 1,600, while active listings retreated 45 per cent compared to the first quarter of 2007

Mortgage Rates to Remain Low

  • With U.S. recessionary pressures continuing, the Bank of Canada is widely expected to cut rates 50 basis points by June 10th
  • Accordingly, mortgage interest rates are expected to remain low in 2008 and start to creep higher in 2009 as investors gain more confidence in financial markets
  • One and five-year mortgage rates are forecast to be in the 6.25-7.25 and 6.50-7.50 per cent range, respectively, in 2008 and beyond

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