We are now more than halfway through winter here at Blue and what a winter it has been (or not).  In spite of the weather we have had great skiing, especially if you are able to get out early in the mornings and the Village has been packed, with even the overload parking lots becoming used most weekends.  I went to see the ski cross races a few weeks ago and I have to say, that as I stood at the bottom of the hill watching the skiers go through their paces, even I was impressed with our mountain and the job the groomers are able to do on it.

Currently we have 99 condos listed in the Village (and another 11 single family homes in Snowbridge) which is pretty consistent same period last year.  Suites sold in the Village from December 15 to today are shown below.  You can see size by bedrooms on far right hand side under BD.  Not shown are the two Snowbridge single family homes that recently sold, one for 1,010,000 and another for 638,000. 

Last year in total we sold 44 suites and apparently we are on track to do about the same this year.  If that is the case, we are running with more than two years inventory, which doesn’t bode well for sales or prices.  I would suggest that if you are really serious about selling, you have to be very realistic about the price you do list for.  If it has been sitting at the same price through our busier time of year and not sold, then you should seriously consider dropping your price. 

To put the market here in the Village in perspective, I have had my Snowbridge home listed since last June; (I had an offer for 1,125,000 on it 3 years ago) so I had optimistically listed it for 1,200,000 this time.  After 8 months and many price reductions, I am  down to 1,029,000 and will continue to reduce it until I find my market.  It is the same situation at Lora Bay and other higher end developments (a beautiful house in Lora Bay sold at a discounted price of 715,000 in September 2010 and is now listed for $625,000 and still no takers.)  A vacation home is a nice to have, not a need to have and everyone is being very cautious with their money right now.  However, if you are a buyer, there is great value out there right now.

The warmer temperatures experienced throughout the Georgian Triangle this winter appear to reflect the heat being generated by the real estate market in the area. According to the statistics released by the Georgian Triangle Association of REALTORS® (“GTAR”) for the month of January, sales are up by a whopping 37% with 104 properties changing hands in the first month of the year as compared to only 76 recorded in January of last year. This marks the fifth month in a row in which monthly sales have bested last year’s performance for the

same month.

Total dollar volume figures were even more impressive than unit sales, registering a 43% gain over last year at this time, highlighting the ongoing strength of the higher end of the Georgian Triangle real estate market. In particular, four sales were recorded in the $1-1.5 million range compared to only one last year at this time. Market strength, however, was not limited to higher priced properties. In fact, sales surged across a broad range of price categories with January’s performance either matching or exceeding last year’s sales in all price categories below the $600,000 range.

Despite the fact that 4% more new listings came onto the market in January than last year at this time (509 versus 489), the swift pace of sales contributed to a shrinking inventory with active listings slipping 3% year over year to 1829 compared to 1884 in January 2011.

The increase in demand for properties in the Georgian Triangle was further reflected in the jump in average sale residential sale price for January which came in at $358,643. This marks a 25.6% hike over last year at this time when the average residential sale price came in at only $285,447. Caution, however, should be exercised in ascribing too much weight to these figures as they represent a relatively small sampling of sales over only one month.A more meaningful and likely representative figure in broader price trends is likely found in GTAR’s figures related to single family residential activity. In that context year over year monthly figures reflect a similar price bump, however, average sales price figures measured over the last twelve months indicate a more sustainable 4% price increase with the average sales price coming in at $327,299 compared to $315,108 over the same period the previous year.

A cross section of market commentators attribute the ongoing vitality of the real estate market in large part to the persistence of historically low borrowing costs, making property purchases comparatively accessible to a growing number of potential buyers. Most financial sector and economic commentators indicate that interest rates are unlikely to move significantly if at all over the next year and accordingly borrowing costs should continue to remain extremely affordable within the current economic climate. A few potential qualifiers, however, are worth monitoring. Government and financial sector regulators have expressed increasing concern over growth in average household debt to income ratios, and may consider measures to further tighten lending rules. In addition, the American economy is showing welcome signs of life with positive employment figures and related indicia of real economic recovery finally taking root. In that event, and if this trend continues, it is less certain that interest rates will remain unchanged. Finally, the other element of instability in this equation is the ongoing turmoil on the international stage, including the stubborn European financial crisis. All of these factors make it more complicated to predict the performance of the real estate market with any certainty moving forward. That said, the Georgian Triangle remains well positioned in this climate to continue to attract buyers to the area with its enviable position of comparative affordability and market stability, to say nothing of its natural attributes and wide range of local services and attractions.

By: Richard Stewart, Vice-President and Legal Counsel, Chestnut Park Real Estate Ltd.

Forty per cent of baby boomers in Ontario plan to move for their retirement, but many are waiting to sell their homes in the hope that values will increase, according to a recent report.

Baby boomers -- those born between 1946 and 1964 -- indicated their top motivating factors to move in a TD Canada Trust Boomer Buyers Report. They reported that their home is part of their retirement strategy (37%) or their current home is too big (29%). Although many respondents delayed their downsizing plans because of house value, nearly one in five indicated that they need the extra space to accommodate adult children still living with them. Those adult children are also keeping some boomers (17%) from moving at all. 

Almost half of boomers (45%) in the province still have a mortgage on their home and the majority (57%) revealed they will need another to finance their next home purchase. Seven in ten respondents indicated that they plan to make a large down payment on their next home purchase, while almost half (49%) will try to save on interest payments by making more frequent mortgage payments and shortening the amortization period.

Although 63 per cent of Ontario boomers say they believe they will be able to retire mortgage-free, 37 per cent say it’s not likely because of other expenses.

Baby boomers -- whether mortgage-free or not -- will continue to drive demand in the national housing market over the next 20 years, according to the Conference Board of Canada. The board predicts that by 2030, more than 60 per cent of new households will be aged 75 and older. If younger seniors are included, that figure jumps to 81 per cent. Seniors are expected to look for smaller, less burdensome housing, boosting demand for multiple housing units, especially condos and apartments.

The board’s Canadian Long Term Economic forecast predicts that the share of multiple housing units will increase from the current rate (47%) upwards (to 68%) in 2030. “As the population ages, construction will shift from single family dwellings in the suburbs to multifamily developments catering to the needs and desires of the soon-to-retire baby boom generation,” the article concludes.

Visit www.tdcanadatrust.com and insert “boomer buyers report” in the search box or www.conferenceboard.ca and insert “baby boomers housing market” in the search box.

As printed in the Edge Newslette