5 Bullet Friday...Step-Up Homes Are Getting Busy ??
Welcome back Sudbury! ??
Take a peak at the numbers from the last few weeks!
Here are my 5 takeaways this week:
??It feels like market activity is slowly starting to pick up.?That may be caused by the drop in listings that we are seeing happen week-over-week. Currently we are sitting at over 20% fewer listings than we were just 4 weeks ago. Last week's sales and this week's pick-up in pending deals are likely the cause of less active listings. Not everything is moving, but it definitely feels like buyers are coming off the sidelines to make a push before the winter market sets in.?
??National news was reporting in the last few weeks about the jump in housing activity in Toronto for October.?The stats showed that sales surged 44% year over year for the month of October. Sure, the numbers of 2023 may have been extra slow, so any increase wasn’t too difficult, but it's interesting to see the market pick up that significantly.?Whatever happens down Southern Ontario usually works its way up to Sudbury, so that's a promising sign that things are headed in a positive direction, likely in time for the Spring market. ?
??Chatting with a few of the Realtors in the office, the comment they made is it seems like the step-up type homes are getting busier. We are seeing more buyers at the 600K price point + jump back in the market and start getting out to see homes.?This was reinforced by the sale this week on Solstice that was listed in the low 600’s and went well above asking price with multiple offers. A few months ago, most of the places that were selling in bidding wars were only in the 400k price point, but with the shift in activity, it looks like sellers in the step-up type price range may see more activity. It will be interesting to see if this is a small bump in activity before the snow or if this carries us through the winter market into spring. ?
??The federal government has made some changes to immigration that will see our population numbers actually decrease if the government gets their way as they reduce immigration in the next few years. Nationally, the boost in immigration has been one of the biggest saving graces for our economics. With more people to sell stuff to, we have been able to see modest GDP growth with the large inflow of population.?If we see population fall, there is a good chance we can see GDP fall with it.?Now how will this effect be felt locally is another story. I believe even with lower growth to the national population, Sudbury will still see a large in flow of new-to-Sudbury population.?That's based on the theory that as people immigrate to Canada, they focus on the bigger cities, but after seeing the cost of living and the chaos that comes with living in GTA or bigger cities, they will be drawn to the affordable life that exists just a few hours north. So despite a decrease in national population, my guess is we will continue to see Sudbury thrive from new people moving into the area. ?
??I’ve been chatting with a few landlords locally, and there seems to be a consensus that there is a few interesting observations at play. First, rents seem to have peaked about a year ago. This doesn’t mean they are going down but they are staying flat, and new units that are renovated aren’t able to get new premiums over the market, like we had seen them able to do a year ago.?Second, there seems to be a shift in demand with one bedroom units more sought after.?Likely this is due to one bedrooms being the new step-up units, as more people starting out are sharing accommodations or renting rooms in a house, and when they are able to step up from that, they are targeting one bedroom apartments.?Previously, it was the one bedroom apartments people would start with, and then as they grew the need for space or they expanded their family, they would look for larger units.?Also, there seems to be a lot less activity with new construction for apartments. We have stats from a few years ago, but in 2021 new construction for apartments was full steam ahead with almost 140 units, and that dropped significantly in 2022 to only 23 new units.? As the cost of construction and financing has increased, we will likely see fewer new projects hit the market in the future, putting more demand on the existing units.?
Have a great week Sudbury, we’ll see you next week!