WINNIPEGGERS are movin’ on up to more expensive homes, but it may not be because they want to.
Last month, for the first time ever, the most popular price range in the Winnipeg resale-homes market was $250,000 to $299,999. It accounted for 20 per cent of all the detached homes sold through WinnipegRealtors’ Multiple Listing Service (MLS).
For much of the previous two years, the most active price range had been the one immediately below that -- $200,000 to $249,999. But last month, it accounted for only 17 per cent of residential detached sales, as did the next lower range -- $150,000 to $199,999.
WR president Shirley Przybyl said some of last month’s shift may de due to Winnipeggers taking advantage of low interest rates and splurging on a more expensive home.
But she suspects most of it was due to the rising property values. Most houses are worth more today than they were a year or even six months ago. So people are paying more because they have to, not because they want to.
The average selling price of a Winnipeg resale home increased by 5.9 per cent in 2011, and the Canadian Real Estate Association predicts average selling prices in Manitoba will increase at the fastest pace in the country over the next two years, at 3.5 percent and three per cent.
To illustrate how quickly the $250,000 to $299,999 range has moved up the ranks, in February 2010 it accounted for only 13 per cent of residential detached sales; in February of last year, it was 16 per cent.
Although the resale-homes market has been slowing in other parts of the country, February’s MLS sales data show it’s still going strong in Winnipeg.
A total of 781 properties changed hands last month through the local MLS – the same number as in February 2011. And it was the second-best February on record for property sales.
However, thanks in part to rising home prices, the dollar volume of sales last month was 12 per cent higher than a year earlier-- a record $191 million versus $171.1 million.
That boosted the dollar volume for the first two months of 2012 to $324.3 million from $295.6 million during the same period last year – a gain of 10 per cent. Units sales were just two units shy of last year’s pace, at 1,345.
Przybyl said with the busy spring selling season just around the corner, the inventory of homes on the market remains extremely tight, with only about a month-and-a-half worth of supply.
Since a balanced market usually has about a three-month supply, it’s still very much a seller’s market, she said. That’s further borne out by the fact 44 per cent of the detached homes and 31 per cent of condominiums that sold last month went for more than the list price.
The WR said the average selling price for a residential detached home last month was $266,000, versus $240,000 in February of last year.
Article printed by Winnipeg Free Press on 03-7-12.