The head of the local real estate board says the Grey-Bruce market is showing signs of leveling off from the frenzied buying that had been taking place over the past couple of years.
Steve Dickie, president of the Realtors Association of Grey Bruce Owen Sound, said Tuesday that local agents are starting to again see conditions put on sales, some price reductions on listed properties and even a decrease in the number of offers on homes.
“The conversation around offices is that it is not as frenzied as it was last year,” Dickie said. “There are still lots of situations where you have multiple offers, but if you are watching the board on a daily basis every once in a while you will see a price reduction, which we haven’t seen in a long time.”
And Dickie said they are again seeing conditions attached to sales, even the condition on the sale of a buyer’s property, something that was non-existent in 2021.
“There are still lots of offers that are straight cash offers, but we are starting to see some conditions in there,” Dickie said.
“We are even seeing the odd home inspection. That has been one of the side effects of this whole thing is that there have been a lot of home inspectors that have gone out of business because they just had no work.”
Dickie said it is hard to say what has caused the slight cooling of the market, but rising interest rates could be a factor. Last month the Bank of Canada raised rates half a per cent, and indicated future rate hikes could be possible to try to help tame surging inflation. An easing of pandemic fear and even the War in Ukraine could be having an impact on the housing market locally, Dickie said.
“Any time there is a world event going on it makes people somewhat uncomfortable,” said Dickie. “It makes people a little less comfortable with the stability of things and you kind of see a bit of slowdown or a cooling I guess and then people say, I guess it is OK, the world is not coming to an end, and off they go and continue down the path.”
The number of homes sold through the MLS System in Grey-Bruce totaled 283 units in April, which was down more than 25 per cent from April 2021.
Over the first four months of 2022, home sales have totaled 937 units, which is a decrease of 13 per cent from the same period of 2021.
Dickie said it will take a bit of time to see if the slight cooling of the market is a trend.
“There is not enough to make a call yet, but if we see a few more months of this we can be more sure in our predictions,” he said.
Meanwhile, home prices have remained elevated in Grey-Bruce, with the average price of the homes sold in April coming in at just under $744,500, which is up 19.4 per cent from April 2021.
The average price of homes sold in Grey-Bruce in March was $759,427, while year-to-date in 2022 the average sale price has been just under $755,000, an increase of 22 per cent from the first four months of 2021.
“Prices are still high for sure,” said Dickie. “Normally in these situations when we start to see a slowdown we will see it in the very expensive properties first. We are just going to be monitoring that as the next couple of months go on.”
Dickie said larger centres like Toronto experience much more dramatic moves in the housing market than an area like Grey-Bruce.
In Toronto, the average price of homes declined 6.4 per cent in April from the month before on a seasonally adjusted basis. It was the biggest monthly drop in that market in two years. Toronto home sale totals also declined 26 per cent from the month before.
Typically in Grey-Bruce, Dickie said they see prices level off for a while before they start to go up again.
“I am trying to tell people locally to stay calm,” Dickie said. “Nothing is going to crash.”
RAGBOS, which represents approximately 450 realtors, also provides MLS Home Price Index benchmark prices, which it says tracks prices far more accurately than is possible using average or median price measures. The benchmark price is based on the value home buyers assign to various housing attributes, according to the Canadian Real Estate Association.
The overall MLS HPI composite benchmark price for Grey-Bruce was $619,800 in April, which was an increase of 25.8 per cent from April 2021. For single-family homes the benchmark price was $623,500, up 25.7 per cent from a year ago, for townhouses and row units it was $506,300, up 26.5 per cent, and for apartments it was $382,000, up 40.7 per cent from April 2021.
Meanwhile, Dickie said agents are starting to see more listings coming onto the market, which is welcome as the region had been experiencing an extended period of record-low supply.
While the 447 new residential listings in April was down 4.3 per cent from a strong April 2021, they were close to 14 per cent above the five-year average.
At the end of April, the number of active residential listings totaled 461 units, which was up more than 10 per cent from the end of April 2021, but still 28.7 per cent below the five-year average.
The months of inventory numbered 1.6 months at the end of April, which was up from the 1.1 months recorded at the end of April 2021, but still below the long-run average for the time of year of 4.7 months.
“Even this morning I was talking to several agents and they were talking about how they had more and more listings coming up, and there are more and more listings on the real estate board on a daily basis than we had seen earlier in the year,” Dickie said. “That is positive that people are getting their houses listed, which helps the whole situation out.”