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Outlook predicts 2009 market more balanced with slow, steady growth
Dec 04, 2008

Global economic uncertainty weighed heavily on residential real estate activity in most major Canadian centres during the latter half of 2008. 

Although the forecast for 2009 promises more of the same, most Canadian markets — including Winnipeg —  are expected to weather the storm, according to a recent  RE/MAX report.

“Winnipeg remains one of the hottest markets in the country for real estate,” according to the RE/MAX Housing Market Outlook 2009, “reporting record-setting sales for the first nine months of the year. The market, however, pulled back in the fourth quarter due to rising economic concerns.

“As a result, an estimated 12,900 homes are expected to change hands in Winnipeg by year-end, a modest decrease from peak levels logged in 2007.”

Despite consumer uncertainty and a volatile stock market brought on by the global economic crisis, the report said Winnipeg’s local economy remains healthy. “A robust labour market continues to be both a sign and source of vigour for the Manitoba economy.”

The RE/MAX outlook for 2009 is that the housing market will be balanced  with slow steady growth continuing.

“Inventory levels are expected to increase by 10 to 15 per cent over 2008. Values will remain stable with minimum increases. The average selling price is forecast to appreciate two per cent to 212,000 by year-end. The number of homes due to change hands is forecast to match 2008 levels.”

So far in 2008, the average home price in Winnipeg has increased from $170,502 to $207,882.

But inventory increased in the last quarter, “and what was previously a seller’s market has become more balanced,” according to the report.

The WinnipegREALTORS® Association reported that the MLS® list price  has been closely matching the average selling price, an indication of a more balanced market.

“A more competitively-priced market is good news for buyers and also sends a strong message to sellers to be more realistic in their pricing,” said WinnipegREALTORS® president Darlene Clare.

The association’s end of November statistics showed listings were up year-over-year by 10.5 per cent, and a listing on average spent 32 days on the market in November.

“Despite the fact that housing numbers year-over-year are still comparable,” said WinnipegREALTORS® executive-director Geoff McCullough, “there is a noticeable adjustment evident in the market. Both October and November numbers suggest we are at the beginning of a correction that will be defined by the duration and severity of the recession in the States and its effect on consumer confidence in Winnipeg.”

Despite the market correction, the RE/MAX report predicted that the number of homes in Winnipeg expected to change hands in 2009 will match the 2008 level. The report forecasts an estimated 12,900 homes will change hands this year in Winnipeg, which is a modest decrease from the record level of just over 13,000 MLS® sales in 2007.

WinnipegREALTORS® reported that 12,126 MLS® properties changed hands at the end of November this year, a 3.5 per cent decrease from 2007.

Nationally, 440,000 homes are expected to change hands in 2008, according to the RE/MAX report, down 15 per cent from record 2007 levels. By year-end 2009, unit sales should match 2008 levels, while the average price is forecast to fall another two per cent to $293,000.

“Canada’s real estate environment is considerably more complex than it has been in recent years,” said Elton Ash, regional executive vice-president, RE/MAX of Western Canada. “The landscape is definitely changing — with most markets shifting into either balanced or buyer’s territory. 

“The shutout is over. Sellers no longer rule the roost. Opportunities exist for purchasers like never before, including lower interest rates, greater inventory levels, the luxury of time to make decisions, and the upper-hand at the negotiating table. Motivated vendors will need to take note of the new mindset and set their prices accordingly.”    

The highest percentage increase in unit sales is anticipated in Saskatoon, where the number of homes sold is forecast to climb three per cent in 2009. Housing values are expected to hold the line in 2009, with St. John's, Montreal, Kingston, London, Winnipeg, Saskatoon, and Regina posting modest gains in average price in 2009.