2020 Vision: Looking into the Guelph real estate market
Guelph bucked the national trend in 2019. Prices and sales across the country were expected to show modest gains and recovery over 2018, and while that was true for the country as a whole, Guelph exceeded expectations and continues to lead most markets in terms of sales and price growth. Last year we indicated that 41% of homes sold in Guelph moved at or above list price. This year that number is even higher: 49% of properties are changing hands at or above list price. The telling part of this story reflects the reduced levels of available homes and the almost double-digit population growth our city is experiencing.
Originally posted on January 3, 2020 by www.homegrouprealty.ca
It seems that 2018 was the year that the market took a breather. It would appear that buyers and sellers used 2018 to take stock, save money, and do renovations. In 2019, we witnessed an increase of 8.6% in the number of sales and a 7.7% increase in the median sales price within the city limits. Once again, detached homes represented the bulk of sales, at 54% or 1231 units. Condo apartments showed the biggest gain in market share, with a remarkable 23.9% increase to 399 sales. More about the condo market in our predictions for 2019.
While overall sales numbers were up in 2019, we still haven’t returned to the levels experienced in period from 2014 to 2016, in which yearly sales were over 2,400 homes for three straight years. Despite a growing population, the housing market – and the resale market, in particular – has not been able to keep up. With less inventory available, current owners are staying put until the “right” property comes on the market. Higher prices have also meant a segment of the population hasn’t been able to find anything affordable, yet.
Once again, the condo market has bucked the trend. 527 condos were listed in 2019, up 11.9% over 2018 and 27% more than in 2017. The condo market is gaining within Guelph, as the market shifts further to smaller and more affordable housing.
OUR 2020 CRYSTAL BALL
Our predictions last year for additional increases in interest rates didn’t pan out. The Bank of Canada rate has been steady at 1.75%, and indications are that they will remain at that level for the bulk of 2020. We don’t expect mortgage rates to fluctuate much at all either. What we do expect to see is that borrowers with stellar credit history will benefit more from low rates. For buyers with less than stellar credit, 2020 might be the year to improve your credit score in order to qualify for a lower rates and larger loans, as the major lenders have become more selective with their underwriting requirements.
We expect the Guelph real estate market to continue to outpace the regional and national expectations. Population growth, new construction, and continued low interest rates will keep our market active. Expect prices to continue to increase, likely in excess of 10%, and expect this strong seller’s market to continue for the foreseeable future.