June 2022 Market Update for Waterloo Region
Last Updated on June 8, 2022
LISTINGS INCREASE WHILE HOME SALES SLOW IN MAY
MLS® HOME PRICE INDEX EASES FOR THE THIRD CONSECUTIVE MONTH
There were 661 residential homes sold through the Multiple Listing Service® System (MLS® System) of the Kitchener-Waterloo Association of REALTORS® (KWAR) in May, a decrease of 22.7 per cent compared to the same month last year, and 5.5 per cent below the previous 5-year average.
“The increase by the Bank of Canada to the key interest rate in April had the predictable result of knocking some buyers down if not out of the market in May,” says Megan Bell, President of KWAR. “While the impact to prices is small, it has had a critical impact on some buyers and what they can now afford.”
Total residential sales in May included 404 detached (down 16.7 per cent from May 2021), and 115 townhouses (down 38.5 per cent). Sales also included 95 condominium units (down 12.0 per cent) and 47 semi-detached homes (down 36.5 per cent).
The Average Sale Price Of All Residential Properties Sold In May 2022
In May, the average sale price for all residential properties in the Kitchener-Waterloo area was $875,194. This represents a 18.3 per cent increase over May 2021 and a 3.5 per cent decrease compared to April 2022.
- The average price of a detached home was $1,016,834. This represents a 17.0 per cent increase from May 2021 and a decrease 4.2 per cent compared to April 2022.
- The average sale price for a townhouse was $708,722. This represents a 17.7 per cent increase from May 2021 and a decrease of 7.2 per cent compared to April 2022.
- The average sale price for an apartment-style condominium was $545,825. This represents an increase of 19.7 per cent from May 2021 and a decrease of 9.1 per cent compared to April 2022.
- The average sale price for a semi was $730,768. This represents an increase of 10.7 per cent compared to May 2021 and a decrease of 7.0 per cent compared to April 2022.
The MLS® HPI composite benchmark price for all residential properties in Kitchener-Waterloo was $848,600 in May. This represents a 15.1 per cent increase over May 2021 and a 4.7 per cent decrease compared to April 2022.
- The benchmark price for a detached home was $945,800. This represents a 14.6 per cent increase from May 2021 and 4.9 per cent decrease compared to April 2022.
- The benchmark price for a townhouse is $728,300. This represents a 22.6 per cent increase from May 2021 and a 5.1 per cent decrease compared to April 2022.
- The benchmark price for an apartment-style condominium was $550,100. This represents a 26.9 per cent increase from May 2021 and a 1.8 per cent decrease compared to April 2022.
New Home Listings in May 2022
There were 1,422 new listings added to the MLS® System in KW and area last month, an increase of 33.9 per cent compared to May of last year, and a 40.4 per cent increase compared to the previous ten-year average for May.
The total number of homes available for sale in active status at the end of May was 902, an increase of 98.2 per cent compared to May of last year, and 28.8 per cent below the previous ten-year average of 1267 listings for May.
The number of months of inventory increased to 1.6 months in May from 1.2 months in April. While inventory is still at historic lows, this is the highest it’s been since September 2019. The number of months of inventory represents how long it would take to sell off current inventories at the current rate of sales.
The average number of days to sell in May was 11 days, compared to 9 days in May 2021. The previous 5-year average is 16 days.
Those requiring specific information on property values should contact a local REALTOR®. Working with a Realtor is the best way to get a complete picture of the property and community you are considering.
What’s Ahead for the Real Estate Market?
“With the announcement from the Bank of Canada about another interest rate hike this week we may see a resurgence of buyers who have locked in at a lesser rate, but as borrowing costs continue to increase, we should expect demand will continue to soften, particularly in the more entry-level segment of the market,” says Bell.
To help encourage new listings and address our supply shortage, Ontario’s REALTORS® are asking the government to introduce a short-term Land Transfer Tax holiday. More information about this and other proposals can be read in the Ontario Real Estate Association’s (OREA) recently released policy report, Rebuilding Ontario: A Framework for Recovery.