There were record high home sales and prices in September!
As the weather turned colder, home sales heated up by 0.9% month over month, giving mortgage brokers throughout Canada plenty to do. Given the unique circumstances of this past year, this change in sales can be at least partially attributed to a delayed demand from the spring season. Combined with lower supplies, this demand increased the desirability of existing homes on the market, which in turn drove prices up. And of course, we can’t forget the markedly lower interest rates.
We especially saw a demand growth in urban areas (like Barrie), due to the increase in the numbers of at-home workers. Over the summer, many employers realized that by having employees work from home, they can save the in-office costs associated with in-house staff. These new at-home workers, in turn, are looking to receive the best possible value for their money, and are seeking out larger homes that present the space needed for permanent or long-term home offices.
Of course, we’d be remiss if we didn’t take a look at the impact on listings and prices over September, so without further ado, let’s dive into the data!
A Spike in Sales & Pricing
The most notable change came in the percentage of sales activity for September, which blistered past previous years with a 45.6% increase and a margin of 20,000 sales. Bear in mind, the percentage reflects the actual sales activity, not the seasonally adjusted statistic. In fact, sales activity escalated in almost all Canadian markets year over year, which means that this month’s numbers surpassed even the pre-Covid standards. There were a lot of busy mortgage brokers!
In the same vein, all but two of the 39 tracked national markets experienced a rise in pricing. Near urban areas, prices experienced an increase in response to the demand for cheaper, more spacious dwellings for former big-city residents. The non-seasonally adjusted home price index showed some of the largest gains on record, increasing 10.3% on a year over year basis.
In the Barrie area, in particular, there was an increase of over 16% in pricing (up by 2.19% just in the last month!). Currently, the average seasonally adjusted price for Barrie and the surrounding District is $549,700.
A Decline in Listings
Even as prices rose, they did so mostly on previously-listed properties. On the whole, the number of newly-listed homes went down by 10.2%, effectively reversing the impact of the listing surge in August. The overall supply of new listings in local markets dropped by two-thirds, led by steep declines in the GTA and Vancouver.
As listings grew scarce, supply quickly dwindled. Nationally, there was only 2.6 months of inventory left at the end of September for the lowest stock on record. In fact, some local markets only had a few weeks of stock left, and most of Ontario has just about one month of inventory in reserve.
Takeaways & Looking Forward
Overall, the housing market came back strong in September, powered by low mortgage interest rates (be sure to talk to your mortgage broker if you’re looking to buy!) and pent-up demand, especially among those workers who were able to maintain their income throughout the course of the pandemic thus far. Those workers who were affected by lockdown closures, such as those working in accommodations, travel, or food service, were likely unable to maintain their pre-Covid income, and are less likely to be included in those who bought homes over the past month.
Do be sure to check out chief economist Dr. Sherry Cooper’s blog post for more details about the housing market this past month. If you’d like to learn more about what I do as a mortgage broker, or if you have questions as to how I can help you, call me at (705) 791-6683. You can also contact me online
