Kitchener, and Waterloo and Cambridge (KWC), Southern Ontario’s Tri-City, is dubbed as “Canada’s Silicon Valley” for being the home of various information technology companies. But now, the three cities are also slowly making their mark in the housing industry even though the performance of their housing market is not as robust as the other active cities in the country. However, the market is also facing serious challenges due to the increase in prices and changes in mortgage rules.
The latest data from the Kitchener-Waterloo Association of Realtors shows that the average house sale price in the area rose by 20% year-over-year, going from $387,291 to $467,513. Broken down by type of housing, the average sale price for a detached home was $549,046 while apartment-style condos were priced $271,940 on the average. Townhouses and semi-detached homes were sold at $353,692 and $378,275, respectively.
In terms of housing starts, projects that began construction work at the end of 2017 declined by 5.5% compared to a year earlier. Housing starts for freehold units also declined by 16%, and rental units fell by 36.4%. However, despite the drop, the condominium sector housing starts increased by a remarkable 68%.
Units that have been constructed or are nearing completion increased by 4.4% in 2017 from a total of 3,846 during the last quarter of 2016. Completions, on the other hand, declined by 23.3% based on a year to year comparison.
On a yearly comparison, lesser units for single detached, semi-detached, row houses, apartments, condominiums and rentals were absorbed last 2017 (2,498 units) compared to the 3,117 units which were either sold or rented in 2016. Based on this performance, 2018 will most likely experience a drop in real estate activities as well.