Despite near perfect weather for winter house-hunting, residential real estate sales in Kitchener Waterloo started the year rather sluggish. There were 253 residential sales reported though the MLS in January, down 8% from last January. Of the 253 sales, 26 were new homes and 227 were resales. New homes experienced a slight uptick with the opening of the Vista Hills subdivision in Waterloo. However, continuing a trend first seen in the fall of 2011, new homes sales declined 26% year-over-year. Resales in January were down 5% over January 2011 sales.
There was some good news for successful sellers in January as the average price of resale homes climbed nearly 7% year over year to $295,843. Sellers of resale homes received, on average, 97.6% of their asking price versus just 96.8% last January. It took, on average, 53 days to sell a home on MLS this January while sellers last January were rewarded in just 42 days.
As we begin February, there are 1165 active residential properties on MLS. Of these, 389 are new homes or to be built while 776 are resales. Using January sales figures, we have nearly a 3 1/2 month supply of resale homes. Keep an eye on this number as it is trending toward a balanced market and away from the strong seller's market that has characterized Kitchener Waterloo for much of the past 10 years.
So what is holding the market back? Mortgage lending standards are becoming increasingly tough and the big banks have recently expressed concern over unsustainable real estate prices. High household and government debt are also prominent in the media.
Locally, if I had to speculate, I'd say it's the fear and uncertainty over the fate of Research in Motion. Barely a day goes by without the media or the blogosphere heaping scorn on Waterloo Region's largest employer. To be sure, there will be many locals keen to see how that business story plays out in 2012 and beyond.
On the plus side, employment is quite strong in Waterloo Region as only 6.8% of those looking are unable to find work and we have available some of the lowest mortgage rates in Canadian history.
For sound advice on how this affects your personal real estate situation, I'll be happy to consult with you. Feel free to call or email 519-505-4488 firstname.lastname@example.org.
Century 21 Home Realty Inc. Brokerage
"Delivering results since 1989"