Local real estate agents are blaming slow condo sales for sluggish real estate sales in Waterloo Region in May.
A total of 742 homes changed hands last month, 8.2 per cent below the volume in May 2023, according to the Waterloo Region Association of Realtors.
The number of sales in May 2024 was 20% lower than the previous 10 Mays.
“Sales declined in all categories in May, with condos experiencing the largest declines,” said WRAR President Christal Moura. “The condo market also has the largest supply, which is a challenge for sellers, especially for condos with one or fewer bedrooms, where inventory levels are currently outstripping buyer demand.”
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To put that into context, real estate agents said just 82 condos were sold last month, up 34.4% from the same period last year, while sales of detached homes were almost the same as in May 2023.
“We have witnessed a significant increase in condominium apartment supply this spring, with a record number of apartments on the market,” Mora said.
“At the same time, we are observing a shift in demand away from smaller apartments, likely driven by higher interest rates, which is impacting investor market activity in this property category.”
The drop in the number of sales did not have much impact on home prices, as the average sales price was $818,507, just 0.3% lower than May 2023 and 2.3% higher than April.
Following the large number of new homes entering the market in April, May continued this trend with a total of 1,644 new homes listed, an increase of 28.9% year-over-year and 15.8% above the average level of the past 10 years.
Realtors said there was a large number of homes on the market at the end of May, with 1,741 active listings in June. This is a massive 95.1% increase compared to May 2023 and more than 400 higher than the 10-year average of 1,361.
That means there was a 3.1-month supply of inventory at the end of May, a figure that shows how long it would take to sell all the homes at the current sales pace.
Still, WRAR said it takes about 16 days to replace a home, which is very close to the 14 days it took last May.
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