1st Quarter 2019 Southern Georgian Bay MLS® Market Report -

  Real estate activity for the 1st quarter of 2019 across the Southern Georgian Bay region has shown some improvement from the slowdown we experienced in the second half of 2018 with stronger sales in specific portions of the market particularly in the higher price segments.

  MLS® dollar sales in both January and February were at increased levels from the same time last year but softened slightly in March with sales for the month of $87.6 million down 5.2% from March 2018.  Despite softer sales in March, total 1st quarter residential dollar sales through the MLS® system of the Southern Georgian Bay Association of REALTORS® (SGBAR) totalled $201.9 million, an increase of $12.9 million or 6.8% more than the 1st quarter of 2018.  Once again it is worth noting that these results are for residential MLS® sales only including single family homes, condominiums and vacant lots.  Commercial properties, farms etc. are excluded as are sales of new homes made directly by developers outside of the local MLS®

system.

  While year-to-date MLS® dollar sales have increased over the first three months of 2018, unit sales in 2019 through the end of March are below last year.  MLS® unit sales in the 1st quarter totalled 386 properties, down 10.2% from the 430 units sold in the 1st quarter of 2018.  Sales start to ramp up in January following the end of the holiday season and typically peak April through June when properties start to look their best during the spring and early summer.  Inventory levels of properties listed for sale on the MLS® system also ramp up during this period, potential buyers have more to choose from come spring but competition among sellers is also stronger.  We have experienced a relatively harsh winter which has made for less than ideal driving conditions, this combined with cold temperatures has hampered property showings which is at least partially responsible for the slow start to this year.

  Year-to-date MLS® single family home sales across our market total 279 units a decrease of 5 homes or 1.7% less than the first three months of 2018.  At the same time we are seeing stronger single family home sales in some area municipalities around the region which are reflected on the accompanying chart.  MLS® home sales in Collingwood total 66 properties up 34.6% while sales in the Blue Mountains of 48 homes is up a modest 6.6% from one year ago.  All other area municipalities have year-to-date single family home sales that are close to or slightly below the 1st quarter of 2018.

  While overall year-to-date MLS® dollar volume through the end of March is ahead of last year and unit sales are down, certain price levels are showing some significant gains from one year ago particularly in the upper price segments of the market.  Sales in these upper price ranges is what is driving total MLS® dollar sales making up for the shortfall in unit sales.  Sales in the $500,000 to $799,999 range total 108 properties up 28.5% from one year ago.  Sales from $1 to $1.499 million are up slightly with 13 sales this year compared to 12 in the 1st quarter of 2018.  Sales between $1.5 to $1.999 million total 8 units which is four times greater than the sale of 2 properties sold in the first three months of last years.  Similarly sales over $2 million have doubled this yearwith 4 MLS® sales reported versus just 2 sold at this time last year.  These numbers  clearly reflect that our market continues to move more upscale especially in the Blue Mountains where almost 50% of sales above $750,000 in our market area take place.  Sales in the lower price segments of our market continue to remain weaker than last year particularly in the $100,000 to $500,000 price ranges.  First it is important to note that properties priced under the $300,000 mark are getting harder and harder to find unless they are perhaps a smaller and older entry level home or condominium.  Sales under $100,000 in the 1st quarter of 2018 totalled 32 units whereas this year there we only 13 sales.  During the first three months of 2018 there were 181 MLS® sales in the $300,000 to $500,000 price category this year the number has dropped 12% to a total of 159 properties sold.  Properties in these price ranges represent a prime segment of our market where demand is strong but the inventory of available properties listed for sale is low and we suspect this trend may continue throughout 2019.

  Overall we continue to experience a general shortfall of inventory listed for sale on our local MLS® system.  Year-to-date, the number of new listings for residential properties totals 674 units which is a modest 3% increase above the number of new residential listing that came to market in the 1st quarter of 2018.  While demand still exceeds supply, properties listed for sale are lingering on the market longer before selling.  For the 1st quarter of 2018 the average time-on-market before selling was 47 days, for the first three months of 2019 that average number has increased to 56 days.  The only exception to the inventory shortage is in the upper price ranges of the market.  Overall our MLS® system has 4.6 months of available inventory listed for

sale.  For residential properties priced in the $1 to $1.5 million range there is 8.5 months of available inventory while above $1.5 million there is 26.6 months of inventory listed for sale.  For buyers looking to purchase an upper end luxury home or ski chalet in the area there is an abundance of properties to choose from making this a good time to buy the property that meets your needs and budget.  The level of MLS® listed inventory overall however is showing signs of trending upwards which is encouraging for those looking to buy especially in the lower price segments.  Listing activity in both January and March was above last year’s level in these two

months.

Price Range   Current # of Active Listings  Months of Inventory

Under $300,000                                  55                                                  2.0

$300,000 to $499,999                                                             191                                                 2.7

$500,000 to $799,999                       220                                                 5.7

$800,000 to $999,999                         60                                                 7.8

$1.000 to $1.499 Million                      57                                               11.4

$1.500 to $1.999 Million                      33                                               32.6

$ 2 Million +2218.3

  MLS® condominium sales during the 1st quarter total 68 units, a decrease of 23% from the first three months of 2018 when 89 condominium units were sold.  Some of this decrease stems from a significant number of new condominium units being built and sold in the area by developers which are not sold through the local MLS® system.  A number of condominium properties are also rented out for the ski season and as the season winds down with spring now here some of these condominium properties will undoubtedly get listed in the coming months.

  In summary, overall we have experienced a slight shift in the market.  Sales are softer yet prices thus far have remained relatively stable.  Buyers some of whom must meet tighten mortgage rules and lenders are both being cautious.  With the odd exception, the days of multiple offers with properties regularly selling for well over their asking price are substantially diminished.  To restore buyer confidence as well as to help them meet the tighter lending rules two things need to happen.  First we need to see an upturn in the number of properties listed for sale and the arrival of spring will no doubt bring that about as it typically does.  Cautious buyers and those that require mortgage financing need more choices of what is available to purchase.  Further, both buyers and sellers may need to adjust their expectations in terms of what they as buyers can afford to pay whereas sellers may need to accept more list at more realistic asking prices that are consistent with today’s current market conditions.  With the heated market conditions we experienced in 2016 through to and including early 2018, many buyers got caught up in the multiple offer melee.  More inventory listed for sale will further serve to balance the market levelling the playing field for both buyers and sellers alike.

  As we head into the spring market it will be interesting to see how the overall level of real estate activity unfolds through the balance of 2019.  If you are considering buying or selling in the months ahead I would be delighted to discuss your particular needs and what would be the best strategy in helping you meet you goals and objectives relative to real estate in the Southern Georgian Bay area.  

  Please feel free to Contact Me of you have any questions or to discuss you specific real estate needs and or goals in 2019 or beyond.

   

Finding Your Piece of Paradise On The Water

  We have had a long cold winter and while I like many enjoy skiing, snowshoeing and other outdoor activities this time of year, I am now looking forward and I am ready for the warmer weather and especially the start of another cottage season.

  Waterfront properties in the southern Georgian Bay area make up a significant part of our real estate market.  In 2018 the sale of waterfront homes and condominium properties in Collingwood and surrounding municipalities totalled 111 properties with a combined value of just over $85 million.  These sales ranged anywhere from modest cabins priced in the low $200,000 range to luxury high end homes over $2 million.

  Growing up as a kid I was introduced to the cottage lifestyle on Manitoulin Island where my mother was born.  My grandfather, a farmer on Manitoulin built a small cottage on the water and every Saturday after the farm chores were done we would make the three mile or so drive to the cottage to spend the balance of the weekend swimming and fishing with evening campfires.  Not everyone is attracted to those activities but many are and owing a waterfront property is a dream for countless Canadians especially for those living in urban centres like Toronto that long for a cottage property to escape to.

  As stated above, owning a waterfront property is not for everyone nor can a real estate transaction involving the purchase or sale of a vacant waterfront lot, a modest seasonal dwelling or a full time home or cottage on the water be treated the same as buying a residential home in a typical urban subdivision.   Having owned my own cottage for over 45 years I am well versed in what owning a waterfront property entails including added operating expenses and maintenance above your full time residence.  Is it worth it?  In my opinion absolutely.  In addition I have listed and sold many waterfront properties in our market area several of which we well over $1 million.  This is one segment of the real estate market when the value of waterfront properties has increased significantly over the years.  As the saying goes when it comes to waterfront, "they are not making any more" so that along with the increased demand of consumers looking for their piece of paradise has and will no doubt continue to drive up prices higher.

  Thinking about where we want to be five to ten years from now, my wife and I started to look two years ago at waterfront homes that were for sale on Mantoulin Island.  My cottage is just that, a cottage (Bottom photo) versus a full time home and it will be left to my kids.  Having not seen an existing property for sale that we liked, we started top contemplate building from scratch.  Last summer we found the perfect property listed for sale which was an estate sale.  A 1.5 acre waterfront lot nicely treed situated on the largest lake on Manitoulin, Lake Manitou and just 20 minutes from the cottage and other amenities.   Not only was the property exactly what we wanted but it had some added benefits.  The driveway and hydro was already installed along with a large 24' X 32' garage all of which would be $100,000 or more to replace. See accompanying photos.

  As a REALTOR® I quickly did my own due diligence with the municipality and others which allowed us to go in with a cash offer, no conditions and a short closing date.  The offer was accepted so we now own not one but two piece of waterfront real estate on Manitoulin Island.

  This coming weekend March 21st to 24th is the Cottage Life Show in Toronto.  My wife and I will be attending both days and have lined up a number of exhibitors we want to meet with to gather information on building.  In my next post I will share the details that you need to be aware of when buying waterfront property.  In the meantime take a lot at Royal LePAGE'S Annual Recreational Property Report for a breakdown of the recreational property market across Canada.

  If buying a waterfront or other recreational property is on you wish list, please feel free to Contact Me and I will be delighted to share my experience as a cottage owner and real estate Broker to help you find you piece of paradise in southern Georgian Bay.

Southern Georgian Bay Real Estate Market Report - February 2019

  Real estate activity for the first two months of 2019 across the Southern Georgina Bay region has shown an improvement from one year ago with stronger sales in specific segments of the market.

  Total year-to-date MLS® dollar sales as reported by the Southern Georgian Bay Association of REALTORS® (SGBAR) through the end of February totals $110.3 million, an increase of $20.2 million or 22% from the $90.1 million in sales for first two months of 2018.  While on the surface this number shows a more robust real estate market in our area from a year ago, year-to-date sales are $14.0 million or 11% below the level of MLS® sales for the two first months of 2017.  Once again it is worth noting that these results are for residential MLS® sales only including single family homes, condominiums and vacant lots.  Commercial properties, farms etc. are excluded. 

  

  While year-to-date MLS® dollar sales have increased significantly (22%) over the first two months of 2018, unit sales remain relatively weak.  Through the end of February MLS® unit sales total 208 individual properties, 10 units more or just 5% above last year.  The chart belowshows year-to-date 2019 versus 2018 sales across the various price segments of the market with increases in the upper price ranges most notably $500,000 to $799,999 and from $1.5 million and higher.  The key segment of the market wherein there is the greatest demand is down 11% from one year ago with 85 sales so far in 2019 compared to 96 last year.

  Some of the current weakness in sales is seasonal in nature.  Sales start to ramp up in January following the end of the holiday season and typically peak April through June when properties start to look their best during the spring and early summer weather.  Inventory levels of properties listed for sale on the MLS® system also ramp up during this period, potential buyers have more to choose from but competition among sellers is also stronger.  Overall we experienced a general shortfall of inventory listed for sale on our local MLS®  in 2016 through to early 2018 at which time the market started to show signs of slowing down.  

  

  While that situation exists in some price segments of the market today, it is not universal across the region.  As of this report, the amount of inventory listed for sale in the various price segments varies greatly.  The following is a summary of residential properties listed for sale by price range and the "months of inventory" shown is based on the current rate of sales that we have experienced in these price segments over the past year.

Price Range                            Current # of Active Listings                Months of Inventory

Under $300,000                                        48                                                  1.8

$300,000 to $499,999                             152                                                  2.1

$500,000 to $799,999                             182                                                  4.8

$800,000 to $999,999                               54                                                  7.0

$1.000 to $1.499 Million                            48                                                  8.7

$1.500 to $1.999 Million                            32                                                29.9

$2 Million +                                                29                                                25.0      

  What does this mean to sellers and buyers?  While year-to-date residential sales between $500,000 to $799,999 are up 68% from a year ago, there is currently well over 4 months worth of inventory listed for sale to choose from.  Similarly, sales in the $1.5 to $1.9 million dollar range are 10 times greater than in the first two months of 2018 yet with 32 active MLS® listings that is almost 30 months worth of inventory while properties listed for sale priced above $2 million represents 25 months of inventory.

  The level of MLS® listed inventory overall however is showing signs of trending upwards which is encouraging for those looking to buy especially in the lower price segments.  New MLS® residential listings in January were up 8.6% from one year ago and totalled 190 units.   New listing activity then slipped in February totalling 192 properties down 10.7% from 215 new listings that came to market in February of last year.  There is no question that we have had a harsh winter with adverse snowfalls and bad driving conditions, hardly ideal conditions for buyers to view properties for sale and many sellers have held off listing their home until conditions improve with the arrival of spring.  Many sellers may also be fearful that they have perhaps missed the window of opportunity to maximize the sale price of their home or condominium.  I have in fact had clients of my own who live in the Greater Toronto Area state that selling their home now will net them a lower price than 12 months ago.

  Year-to-date MLS® single family home sales across our market total 90 units an increase of 29 properties or 48% more than the first two months of 2018.  Again this is primarily driven by strong sales in the $500,000 to $799,999 price range as well as the strength of the upper end market $1.5 million and higher.  The Blue Mountains and Wasaga Beach are the only municipalities in the region with single family home sales equal to or greater than last year, all others ie: Cleaview, Collingwood, the Municipality of Meaford and Grey Highlands are all down anywhere from 25% to over 60% in home sales year-to-date.  Yes the number of units is small and the winter has made property showings difficult but we are not the only area where sales are down and it's not all due to "new" home sales as some would claim. 

   With respect to the local condominium market, year-to-date sales of 23 units is down a modest 3 properties or 11% from a year ago.  The demand for condominiums in our area continues to grow and this is not unique to southern Georgian Bay.  A report just released by "Teranet" who is a leading provider of land registry services and real estate data insights across Canada found that in 2017 over 25% of residential real estate transactions across the country were for condominium properties.  Condominium ownership is popular with both baby boomers looking to downsize with a less maintenance intensive lifestyle as well as for first time home buyers that are finding themselves priced out of single family home ownership.  After looking at the residential sales data for our market in 2018 I found that MLS® condominium re-sales in our market accounted for 24% of the 1,800 plus MLS® residential sales in our region last year.  Year-to-date sales reflect that for the first two months of 2019, condo sales have dipped to 20% of all residential sales in the area but this is likely to change in the months ahead as a significant number of area condos get leased our for the ski season and with that season winding down we are seeing more condo units come onto the market for sale.  As of this report there are 110 active MLS® condo listed for sale which represents three months of inventory.  As previously mentioned, several new condominium projects in the area are adding additional new condominium units into the market primarily in Collingwood, the Blue Mountains and Wasaga Beach and the sale of these newly constructed units generally do not flow through the local MLS® system.  For further information on the area's condo market visit my website www.rickcrouch.realtor for a copy of my latest "Condo Communique´" newsletter detailing the 2018 Southern Georgian Bay Condominium Market. 

Summary

  As reported in my last newsletter , the market has shifted, buyers and mortgage lenders are both being cautious.  With the odd exception, the days of multiple offers and properties selling for well over their asking price are gone.  To restore buyer confidence as well as to help them meet the tighter lending rules two things need to happen.  First we need to see an upturn in the number of properties listed for sale and the arrival of spring will no doubt bring that about as it typically does.  Cautious buyers and those that require mortgage financing need more choices of what is available to purchase.  With the heated market conditions we experienced in 2016 through to early 2018, too many buyers got caught up in the multiple offer melee and in many cases I personally feel they over paid.  Banks are fearful of buyers over extending themselves and on occasion financing is not approved if the appraisal comes in less than what the buyer is willing to pay.  More inventory will further serve to balance the market evening the playing field for both buyers and sellers.  Lastly, sellers and to some degree the real estate community needs to accept the fact that the market has changed and listing a property for sale with an asking price that is significantly above fair market value is unlikely to attract a willing buyer(s) nor will it help that buyer(s) to secure mortgage financing if they need it.

  As with other facets of our profession I watch our MLS® system activity closely on a daily basis and I will continue to report on meaningful data that is applicable to the real estate market in our area throughout the year.  In the meantime if you have any questions please feel free to contact me at any time.  A Free PDF copy of this Market Report and others is available on my website at: www.rickcrouch.realtor.