London St. Thomas
& Area Overview:
The
number of homes sold over the last six months is lower that last year (a record
year) by 26.5%. The number of homes offered for sale started the year with slightly
over 5 months’ supply of homes and then dropped in March to an average of 4 months. Remember a balanced market is 6 months’
supply of homes for sale. Since the end
of April, the number of homes offered for sale have increased marginally and
now sit at 5 months’ supply. This will improve Buyer’s ability to negotiate in
some price categories. Home Owners are now getting an average of 99% of their
asking prices. This indicated that many price categories and areas are in
bidding wars. Prices across our trading area are up nicely by 5.9% over last
year’s record price increases. The average home across the county is now worth
$385,586 which is an increase of $21,601 for the first 6 months of 2018. If supply of homes continues to increase, we
may experience some leveling in price increases. In my last report the number of homes
available was lower and we were heavily into bidding wars. This activity has
cooled somewhat because of the continued increase in available properties.
Prices won’t likely fall as we are still seeing an influx of Toronto Buyers
cashing in on their leveling market.
Based on this activity we can expect an increase of about 6% to 8% for
the year over 2017.
London:
The
number of sold homes within the City of London is also reflecting a downturn,
driven by sales with limited supply (less than 6 months inventory of homes for
sale). The number of homes sold is off
24.3% versus last year’s record number of homes sold. Prices on the other hand are still rising,
the average home now sits up nicely by 8.4% or $29,000 bring the average home to
$370.435.
Inventories are low in London sitting at only 3-month average until
June when they rose marginally to 4 months. This low availability is what is
driving the prices up across our trading area. Home owners are getting an
average of 101.8% of their asking prices…Homes priced from $100,000 to $800,000
are all selling at over 100% of asking price.
If this market continues with tight supply, significant demand will
continue to push prices upward.
Inventory levels are obviously the key. First Time Buyers and Move Up
Buyers need to get in now to benefit from continued equity growth in the back
half of this year and in the years to come and from our low mortgage
rates. This is obviously not the time to
downsize unless you need to do it.
London North:
The number of homes that sold in the first 6 months is down by 26.2% versus the first six months of last year’s record year. The number of homes offered for sale has gone as low as only 2 months’ supply in March, then 3 months in April up to 4 months for May and June. This lower availability that is lower than the overall City has translated into constant bidding for homes in London North in virtually every selling situation, getting sellers an average of 101.8% of asking. In addition, limited supply like this can limit overall sales and leave unsuccessful buyers frustrated.
The number of homes that sold in the first 6 months is down by 26.2% versus the first six months of last year’s record year. The number of homes offered for sale has gone as low as only 2 months’ supply in March, then 3 months in April up to 4 months for May and June. This lower availability that is lower than the overall City has translated into constant bidding for homes in London North in virtually every selling situation, getting sellers an average of 101.8% of asking. In addition, limited supply like this can limit overall sales and leave unsuccessful buyers frustrated.
So,
how are prices? Remember that North
London already has the highest average price. This year, this area has risen
again by 7.8% in the last 6 months, or $32,310, to an average selling price of
$444,863.
This aggressiveness should continue if inventories remain well below
6 months’ supply and should deliver an average price between 8% and 10% by year
end. Right now it takes between 15 days
and 21 days to put an average home up for sale and get it sold.
Once
again, the bidding wars in this area are reinforcing that London North continues
to be the most desirable area of London.
The area offers so many conveniences, great schools and the home of
University of Western Ontario.
London South
The
number of homes that have sold is now down 23% over the same sales period of
2017. This is actually a return to more normal levels. This area is also still
very much in a Seller’s market with only 3 to 4 months’ supply of home to sell,
based on demand and inventories. This demand
will continue to push prices up. Home owners are consistently getting over
asking price. They are getting on
average 102.6% of their asking price. So, what has all this done to the average
selling price?
Prices
are up in line with the North at 7.1% or $24,340 bring the average home price
up to $366,562. The number days it takes to sell a home in this area has been
steadily dropping to where it sits at just 18 days on average at the end of
June and dropping.
London East:
The
number of homes sold in London East have fallen by 23.8% versus last years
record sales as well. But, there is
plenty of good news here. Inventories are well below the 6-month average
required for a balanced market. The number of homes offered for sale dropped
under 3 months’ supply in February and March and have increased since then to
about 3.5 Months. Because of these significantly
lower levels of homes offered for sale, these home owners are consistently
getting well over asking prices. The
average for the first six months sits at 102% of asking price. It now takes 20 days in this area to sell a
home.
What
has this low availability of home for sale done to prices?
Prices
in this area are breaking records…Prices are up a whopping 13.2%. This represents an increase of $33,700 on
average bring homes in this area to a new base price of $288,602. The East is beginning to move. What an opportunity for First Time Buyers to
get into the Market.
St. Thomas:
In
my opinion St. Thomas continues to be one of the best priced areas of
Southwestern Ontario. It is really a
Bedroom Community of London and had all key services including bus
services. The fact that Ford is no
longer in Tabotville has little relevance.
St. Thomas is also near Port Stanley, a wonderful summertime destination
for food, entertainment and beaches.
The average price of a home in St. Thomas is still lower than Ingersoll currently
at $322,838 with much less services and infrastructure. I believe people are beginning
to get the message!
Sales
this year have returned to normal levels like all other areas, but off only
20.1%. The number of homes offered for sale here compared to demand has been
consistently lower than all other areas.
St. Thomas has had an average of only 3 months supply for 5 months in a
row. It takes an average of about 20
days to sell a home in this area. This
limited number of available homes is pushing up prices like the other areas.
Home owners have been getting around 101% of their asking price. Again,
experiencing multiple bids.
What
has happened to prices?
Selling
prices for the first six months of 2018 are up a record of 15.2% in this area!
Wow St. Thomas is leading the price growth in the area! This means the average home increased in
value $38,307 since January bringing the average home to $290,821. Still a bargain in any market in Southwestern
Ontario.
Summary:
What
does all this mean. The market is buoyant and will finish with a strong finish
once again. Interest rates are still at record lows. Remember demand is the
key.
Example:
If you are a Toronto Area resident about to retire or kids have left for
University, or you work from home and are sitting on a home worth even $800,000
and you have a low mortgage… What would you do… Move to Southwestern Ontario!
Buy a beautiful dream home for even $600,000 and put close to $200,000 into the
bank for a rainy day! That is what is going to continue to drive this market.
I
love to point out when the average price in 2004 in Mississauga was $240,000
and London and area were at $200,000. Logically,
which market will experience potential correction, I doubt it will be London
and area!
There
is no better time to buy your first home, make a lateral move or move up! If you are thinking of downsizing, wait until
the market comes back into balance.
Please
share this update with anyone who will benefit…and …. Remember, Mary and I are
here to help you, your family, your friends, your co-workers. Call us with
their names, timing, phones and email and we’ll get to work saving them money.
There are differences between realtors. We are proud of our results and our
Friendships with our many Clients.
Gib Heggtveit Mary Heggtveit
Broker Sales
Representative
RE/MAX
Centre City Realty Inc RE/MAX
Centre City Realty Inc
Cell: 519-535-3975 Cell: 51-535-7355
Gib@YourFavouriteRealtors.com Mary@YourFavouriteRealtors.com
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