2017 Mississauga Fall Market Update
The summer came and went and much was made of the demise of the GTA real estate market. And with every passing month, we eagerly awaited the 3rd of every month when new housing statistics became available.
What? You don’t eagerly anticipate that day every month?
But for those of us in the industry it’s a way to measure if what we’re experiencing on a day to day basis matches the overall market outlook. And once again the numbers don’t lie.
September was much slower than its predecessor in 2016 as expected. It’s been 6 months since the Provincial government put the Fair Housing Plan into effect and there has been a clear impact on sales and prices. That, also, was to be expected.
However, where do things go from here? That’s the interesting part of the equation. For Vancouver, their numbers bounced back quite convincingly month to month by the following Spring in every market except the luxury detached market.
We’ve seen month over month decreases since April, but that changed when September numbers posted higher than August. But, that could have been the seasonality effect. The real test would come in comparison to October.
So, how did October stack up to September? Let’s compare.
SEPT 2017 vs OCT 2017
Three things from this month stand out:
- Number of Sales actually INCREASED 10% in October.
- Average Price of all home types combined INCREASED 2.3% in October.
- Months of inventory are at levels very quickly approaching a balanced market, but of course decreased as sales levels increased this past month.
So, we’ve had our second month-over-month increase in prices since the new housing rules came into effect, but perhaps our most significant.
Could it simply be that we’ll see moderate increases signifying a return to traditional seasonality trends? If things continue on this path, that’s where I believe we’ll end up and that’s healthy for all parties in my opinion.
I’m sure the burning question in your mind though is…how does this affect me?
I’m glad you asked. Because the average price only tells a part of the story. As you might have guessed/feared the freehold segment of the market has underperformed while the condo segment has overperformed.
Let’s take a look at the year over year breakdown of the different housing segments:
Year over Year Outlook 2016 to 2017
Overall there was a 5.5% increase in prices from October 2016 to October 2017 in the Mississauga real estate market.
However, look at the stark difference in price increases between the freehold and condo segments. The majority of the price increase has come from the condo market while the freehold market has stagnated.
This phenomenon can likely be explained by the still massive gap in prices between the two segments. Even though prices have come down in the freehold segment from the Spring, they’re still terribly unaffordable for the vast majority of people including most millenials.
That segment has flocked to condos for affordability and the precipitous drop in demand is being first felt in the detached market. Much like it did in Vancouver…
The year over year price increases have come down pretty markedly from 13% in September to 5.5% in October. However, we’ve seen month over increases for the first time since the new housing rules came into effect.
The next critical time to evaluate the market will come in the Spring. The market hasn’t bounced back in the Fall like many predicted after the housing rules came into effect. Now, we wait to see if there will be a continued impact in the Spring.
For my money, I think we’ve returned to a sense of normalcy as months of inventory has jumped up to a healthier level while not cratering prices. I think we’ll see a month over month increase from the Fall, but we will of course see stark price decreases year over year (which will surely lead the headlines).
However, if you’re selling a home in the Spring, I think you’ll sell for more than if you did this Fall.
If you have questions about your particular situation, please CONTACT ME.