Headlines around the country speculate on the potential impact of COVID- 19 on the real estate market. Some are calling for an outright crash due to record unemployment rates. Some are saying that when all this dies down, we’ll just go back to where we left off with strong housing prices in Guelph. Who’s right? Who’s wrong? And most important, what is really happening out there in the Guelph real estate market?
Last month, Beth and Ryan Waller reported that COVID-19’s impact on Guelph real estate prices sent the number of houses sold plunging 70%. It made sense in retrospect: Guelphites were following the rules and self-isolating. They weren’t looking at homes to buy and if they didn’t need to sell, they didn’t sell. But as the Ontario government begins to cautiously ease up on restrictions, it appears that buyers, sellers and Realtors have cautiously embraced a new real estate market.
The City of Guelph has realized 5 consecutive weeks of increasing sales, while the average price in the past two weeks has been back at levels realized pre-COVID. It appears on the surface that, for now, we are slowly recovering. However, in times like this, there are some interesting trends that emerge to show just how dynamic the market can be.
Many people speculated that sellers would panic and put their houses on the market as soon as reasonably possible, which would flood the market with homes and cause a decline in prices. In fact, the overall number of houses available has been declining over the past few weeks. Buyers are buying faster than sellers can get houses on the market. Although still early, there are a few interesting trends that have emerged.
Despite a rough 8 weeks, the average price of a home in Guelph has still increased by almost 11% in 2020. However, the market share of condo sales in Guelph has been declining each month this year in both dollars sold and the number of units sold.
Condos now represent only 18% and 25% market share respectively. This is mainly due to two factors: buyers have been snapping up freehold homes at a faster rate, as well as fewer condo developments offering new units for sale. Sure, the average price of a condo is increasing, but not at the same rate as freehold homes. If you are considering a condo purchase or sale, it’s recommended to ask your REALTOR® to watch this segment closely for you as it appears to be changing quickly.
And although the average price of a home in Guelph has increased 11% this year, there are some neighbourhoods that are really propping up this number. If you own a home in the area of Kortright East of Gordon St, you’re leading the way at a +43% increase in average price. Looking a bit deeper though, this is mainly due to new higher-end development but still plays an important role in the total Guelph growth. Other notable average priced neighbourhood gains include Victoria North (+18%), Riverside Park (+17%), Kortright West (+15%) and Village by the Arboretum (+13%). The only decline in average price year to date is the General Hospital area at -1.3%, but due to generally low sales volume, this may be just an issue of timing.
Lastly, we’ve seen the price bracket of $500- $600,000 rebound quickest in Guelph. Over the past few weeks, this segment has represented over 40% of the sales within Guelph. At the same time, new listings in this price bracket haven’t increased which means that if you’re a seller and were considering selling, now may be the time.
With the re-opening of retail and other businesses, real estate in Guelph is slowly starting to improve toward seasonal levels. Buyers may not be able to attend open houses yet, but there are still a variety of online and virtual tools that could be used online before viewing a home in person. Viewing homes with a REALTOR® is available to serious buyers, but strict safety precautions are to be taken to ensure the safety of both buyers and sellers.