Going into Fall – An August 2023 Market Report
Happy September, welcome to our market report!
With the slow, hot days of summer behind us, buyers and sellers of real estate are refocusing their attention on the fall market in the Waterloo Region. On September 6th, the Bank of Canada held the overnight rate steady at 5%. After having raised rates by twenty-five basis points in June and then again in July to combat inflation. While affordability is certainly still an issue for many Buyers, the pause in interest rates is a signal to Buyers that this may be their time to get into the market or to take action to move up or downsize.
August was exceptionally slow in terms of sales. It was the first time the number of sales fell below six hundred units in a decade. 568 residential homes sold in August and 1025 new listings were added to the MLS® System in the Waterloo Region last month. This number of listings represents an increase of 9.7 per cent compared to August of last year and a 11.7 per cent increase compared to the previous ten-year average. The mood in the market was definitely cautious in summer 2023.
Some Market Statistics:
- Total residential sales in August included 313 detached (down 24.6 per cent from August 2022), and 133 townhouses (up 11.8 per cent). Sales also included 74 condominium units (up 10.4 per cent) and 44 semi-detached homes (up 27.9 per cent).
- In August, the average sale price for all residential properties in Waterloo Region was $761,287. This represents a 1.4 per cent increase compared to August 2022 and a 4.4 per cent decrease compared to July 2023.
- The average price of a detached home was $884,621. This represents a 3.9 per cent increase from August 2022 and a decrease of 3.9 per cent compared to July 2023.
- The average sale price for a townhouse was $659,704. This represents a 8.0 per cent increase from August 2022 and a decrease of 1.7 per cent compared to July 2023.
- The average sale price for an apartment-style condominium was $485,205. This represents an increase of 4.1 per cent from August 2022 and a decrease of 2.3 per cent compared to July 2023.
- The average sale price for a semi was $669,044. This represents an increase of 2.0 per cent compared to August 2022 and a decrease of 0.3 per cent compared to July 2023.
It is also worth noting that in terms of supply, Waterloo Region on average sits at 2 months of inventory, making it still a Sellers’ market. But not the extreme Sellers’ market the Region has experienced in the past few years. We seem to be heading towards a more balanced market, which is beneficial for both Buyers and Sellers.
Condominium supply, however, sits at 3.3 months of inventory, most likely due to prices in other areas of housing stabilizing and thus allowing Buyers to consider freehold homes they previously might not have been able to afford.
Interest rates play a significant role in the real estate market, both in terms of affecting what mortgage amount buyers can qualify for and in terms of psychological impacts on buyers. While nobody knows for certain what mortgage rates will do over the coming year. We are beginning to hear more and more economists predicting that rates will begin to come down somewhat in 2024. When this happens,
prices are likely to begin to rise again. For this reason, fall 2023 may be a pretty ideal time for first time buyers to get into the market.
The market continues to be ever changing, with changes in the temperature sometimes felt from one week to the next. If you have any questions at all about your current home or possible moves, we would be happy to help keep you updated on the market and help you navigate! Just reach out!
