The Demo Site

WINNIPEG – The city’s home sales market suffered a major slow down summer 2014...

Home sales in the city dropped 12.1 per cent in August compared to the same month in 2013, according to figures released Monday by the Canadian Real Estate Association. There were 1136 sales in August 2014 compared to 1292 in August 2013.

Meanwhile the number of houses listed on MLS in Winnipeg took a big jump: there were 2,106 new listings in August, a 22 per cent increase over the 10-year average.

“It’s more of a buyers’ market than a sellers’ market,” says Peter Squire of Winnipeg Realtors. “Buyers are in a better position than they have been in years, and aren’t feeling same sense of urgency to buy.”

The significant drop in sales activity resulted in fewer dollars changing hands. Dollar volume in Winnipeg in August 2014 was $301.2 million, compared to $326.9 million the year before, a staggering drop of $26 Million.

Bidding wars are becoming less common: fewer than one in five residential detached sales went for above list price.

Winnipeg isn't the only metropolitan area in Canada to see double-digit percentage drops in home sales. Activity in Sudbury ON, Halifax NS, and the Saguenay region of Quebec and Toronto also fell.

Here is a handy summary:

Realty Market Status
– Pace of Sales = Over Sold
– Decelerating Current Pace vs Peak Pace 89%
– Decline Year End 2015 Projection = 20%
– 25,705 drop in sales projected in 2014
– Year to Date /Fail to Sale Ratio 51.3%
–  November Fail to Sale Ratio 49.9%
–  Buyer Risk = EXTREME
–  Seller Risk = Low
– 12 month Price Prediction = Negative

While summer home sales in Winnipeg were very disappointing, Winnipeg Realtors continue to pump the spin to media and in their weekly Real Estate News publication.

Here are a few things about the market you won’t see published, that any potential buyer or seller should know.

•Detached home sales across Canada have declined.

•The real estate board once again secretly revised its 'year-ago' statistics, and has overstated sales. Surprise.

•Since last April there’s been negative growth in average prices.

•In fact the average price of a Winnipeg property last month is less than the average price was back in the start of summer 2014.

•The average home price is dropping by $10,000 less each month.

•After land transfer closing costs and commission, someone who bought a year ago and sold today has lost money – about $5,000 . However, this was the spin that we read in the paper: “According to the Real Estate Board today, the average price surged 7.4 per cent. The MLS benchmark price rose even faster, by 7.7 per cent.”

Of course, the housing market is still attracting enough fools to engender bidding wars in the hot zone ($700,000 to $ 1 million). Beaters like the one I showed you in a past report on Euclid Ave. are still changing hands far beyond the homes true value.

Canadians are still adding $10 billion a month in net new mortgage debt. And the banks are still handing out home loans like candy at the lowest interest rates in history, while the financially illiterate masses continue to swoon under the realtors’ spell.

This will NOT END WELL...

Kevin

Winnipeg Report