Winnipeg's real estate market has seen some great news as of late: after nearly 12 years of increasingly high property prices, the housing market in central Canada is expected to begin stabilizing throughout the remainder of 2014.
According to a report released by RE/MAX Real Estate Services, marketplace stabilization has resulted in rising house prices in Winnipeg, which are expected to increase at a moderate pace of anywhere from 1 to 5 percent this year. Until recently, buyer demand greatly outstripped the supply in many neighborhoods. Now, according to some Winnipeg real estate professionals, property listings are beginning to increase for the first time since 2002.
On average, residential property prices within the first quarter of 2014 had gone up 4.7 percent compared to last year, from $257,481 to $269,578. Homes priced lower than $400,000 should see gains between 4 to 5 percent, while higher-end homes will see more moderate price growth of 1 to 2 percent due to weaker demand.
In addition, interest rates are currently at a record low, creating an ideal environment for first-time homebuyers. Locals who have been saving up to buy, immigrants and those who have reaped the benefits of Winnipeg's growing manufacturing and agricultural sectors have been the most active in the market, according to the report.
Manitoba is not the only province experiencing positive changes in the real estate market. In February, real estate professionals in Ontario reported that housing sales in the province were stable, indicating that the local housing industry is on a strong footing. Overall, housing starts are expected to moderate in seven out of 10 provinces this year.
However, there is one deterrent that may stand in the way of some prospective homebuyers: land transfer taxes. The fee can be as high as $4,500 for first-time homebuyers, a burden that may prove to be too much for those who have little or no equity to place against a home purchase.
On the other hand, many local realtors are making an effort to inform homebuyers about the tax, and Manitoba's provincial real estate association and other groups have also lobbied against it, calling it an unfair cash grab. Eliminating or reducing the tax, they say, will make it easier for first-time buyers — arguably the engine of the real estate market — to purchase homes, which will have a positive effect on the local and national economies.
Overall, this report shows some positive signs of stabilization for the regional and national real estate market. As time goes on, we'll continue to stay up to date on emerging trends, particularly for 2015 and beyond.