The Winnipeg real estate market has hopped on the pandemic-era housing boom bandwagon. And while growth has been notable, it has not triggered an affordability crisis in this major urban centre.
Many young families and professionals have been migrating within Canada, with hopes of purchasing residential property at a budget-friendly price. Winnipeg and other areas across Manitoba have benefitted from this shift in home-buying trends.
But can these market conditions continue throughout 2022? Suffice it to say, the Winnipeg real estate market got off to an impressive start to 2022, and market forecasts anticipate modest growth for the rest of the year.
Spotlight on the Winnipeg Real Estate Market
According to the Winnipeg Regional Real Estate Board (WRREB), residential property sales fell 26 per cent year-over-year in January, totalling 690 units sold. On a historical basis, home transactions were just three per cent below the five-year average.
Industry experts attribute the decline to limited housing inventory.
WRREB data show that single-family listings slumped 31 per cent year-over-year in January. This has become the trend throughout the coronavirus pandemic, with listings sitting below 600 units. In comparison, there were close to 2,000 units for sale in December 2019.
Tight supply conditions have prompted an increase in Winnipeg real estate valuations. According to the WRREB, the average sales price of a single-family home topped $401,000 for the first time in its history, up 13.8 per cent from January 2021.
Last month, condos also enjoyed upward movement, climbing 12 per cent year-over-year to $251,629.
Overall, most of the Winnipeg region enjoyed notable price growth:
- North: $262,510
- Northeast: $417,273
- West: $282,840
- Southwest: $595,587
- Southeast: $484,255
The solution to soaring price growth that could help prevent more prospective homeowners from sitting on the sidelines? More supply.
“The Winnipeg Regional Real Estate Board has to go all the way back to 2008 when it found itself with such a depleted supply of listings on hand to meet buyer demand in our regional market. Limited supply curtailed sales, and this was most apparent in single-family where they were way off previous year’s activity,” said WRREB 2022 president Akash Bedi in a news release.
“We have our own supply chain issues, but the difference for us is it can be resolved locally with more homeowners putting their homes on the market. There is clearly an opportunity here for sellers to achieve maximum value for their homes based on current market conditions.”
New housing construction has been prevalent in the Winnipeg housing market over the last year.
According to Canada Mortgage and Housing Corporation (CMHC), housing starts advanced 53 per cent year-over-year to 482 units in December. Throughout 2021, shovels were in the ground on 5,700 residential units, up 12.97 per cent from 2020.
That being said, with the Bank of Canada (BoC) raising interest rates in March and more hikes rumoured later this year, buyers and sellers could accelerate their 2022 plans, added Bedi.
What About Other Manitoba Real Estate Markets?
The trends unfolding in Winnipeg are happening elsewhere in the province, too.
In the city of Brandon, residential sales declined 15.4 per cent year-over-year in November, totalling 33 units. However, in the first 11 months of 2021, Brandon real estate transactions increased 14.4 per cent compared to the first 11 months of 2020. Data from Brandon Area REALTORS show that single-detached home sales were 11.8 per cent below the five-year average.
On the pricing front, the median sale price for single-detached homes sold in November gained 9.5 per cent year-over-year, totalling $290,000. Demand for Brandon homes was fierce, with the median number of days on the market coming in at five, down from 28 days in November 2020.
In the broader province of Manitoba, residential property sales slipped 2.7 per cent year-over-year in December, totalling 945 units. The average sale price advanced at an annualized rate of 10.1 per cent to $334,256. New residential listings declined 14.5 per cent to 768.
Will Affordability Reign Supreme in Winnipeg?
With the central bank increasing its interest rate, which will add to borrowing costs, some market analysts anticipate easing across the broader Canadian real estate market.
But might the same expectation apply to the Winnipeg housing sector? Not quite.
According to the RE/MAX 2022 Canadian Housing Market Outlook, Winnipeg housing prices are forecast to rise 3.5 per cent to $322,858 by the end of the year, with sales increasing seven per cent.
The Winnipeg real estate market is striking a balance between growth and affordability. The national average home price in February hit a new high according to the Canadian Real Estate Association, at $816,720. This leaves many young families who want to become homeowners seeking opportunities in the more-affordably priced Winnipeg housing market. It is a growing municipality, especially as the prairies attract newcomers and potentially fresh capital injections to support economic growth.