Niagara real estate feels GTA heatLaura Rotz
Niagara’s real estate market is at a boil, and continuing a trend that may steam ahead for some time.
Last week, the Niagara Association of Realtors reported 760 property sales were processed through the Multiple Listing Service last month — a 14.8 per cent increase in sales over October last year.
Meanwhile, the residential average sale price of $353,5023 is a whopping 26 per cent higher than October 2015.
The average days on the market decreased to 34 from 56 in the residential freehold market, and to 51 from 84 in the condo market over that same time.
It reinforces the sector’s recent robustness in the region, with little abatement in sight.
“I’d say we’re in for eight to 10 years of continuous growth here,” said Patrick Dummitt, president of the asociation.
Dummitt — who suggests the data shows the Niagara market is now among the leaders in the province — points to factors in the region driving desirability here, including an announced GO Train expansion and new residential developments in places such as Niagara Falls.
“I’m experiencing it firsthand (in) talking to other realtors … with people buying 10 and 15 lots at a time, sight unseen,” he said, speaking specifically to the Falls.
Those purchasers include people from the GTA and other realtors representing clients putting in reserves on multiple lots, before ground is even broken.
As for affordability, Dummitt said it’s “kind of like a double-edged sword” with Niagara previously showing modest real estate valuations.
“Now, we seem to be catching up with the rest of the province, and its major centres,” said Dummitt, also a realtor with Royal LePage Niagara Real Estate Centre and based in St. Catharines.
That powering-up is coming in large measure from the GTA, he said. A house that might sell in Toronto for perhaps $1.5 million in Toronto might be cashed in for a decent $500,000 Niagara pad.
The result for the relocating homeowner is “putting $1 million in the bank and having a darned-good lifestyle.”
There is also a foreign investor trend, Dummitt said, and much of that is from Asian deep-pocket investors seeking value.
“So as far as affordability here, it’s all relative,” he said. “You have to save a little more or qualify a little better and have backers or guarantors on hand to help you out.”
The rises aren’t without precedent, the realtor added, citing a period in the mid-1980s when home prices were going up as much as 25 per cent a year.
“For many years now, we’ve talked about how comparatively undervalued Niagara was,” said McGarr Realty Corp. broker Patrick Burke.
The Niagara broker said when you examine major urban areas, a “suburb effect” happens with real estate.
A nearby example is Barrie north of Toronto, with its rising volume of new construction and home prices and improved transportation links to its southern urban goliath.
“Really it’s a matter of we’re no longer ‘Niagara this little island,’ we’re ‘Niagara which is part of the Golden Horsehoe’ and basically a suburb of a major metropolitan world-class city — Toronto,” Burke said.
He said a reason the region had seen single-digit increases for so long is that the “buyer-and-seller pie had largely fed itself … in a closed market.”
“And now, we have a huge amount of demand that’s not feeding the supply chain,” Burke said. “We were getting multiple offers before (in Niagara), but now a lot of them are out of market.
“So we’re part of a larger market, is what we’ve seen,” he said. “And I think … we’ll see this trend continue on.
“I don’t think we’re going to see price increases like we’ve seen every year, on an annual basis. But I wouldn’t be surprised if, in five years, we’ve seen five years of continuous growth.
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