With the desires of homeowners shifting as the global pandemic develops, more and more Canadians are looking to live away from the largest urban hubs in favour of medium- and smaller-sized cities and towns; mostly driven by the trend of working from home. During much of the last two years, the Barrie real estate market has been on fire, however a recent slowdown in sales has led some to believe the market may finally be cooling off. Do the most recent numbers support this theory?
Barrie, Ontario sits just on the western arm of Lake Simcoe, a little over 100km north of Ontario’s epicentre, Toronto, and is home to just about 150,000 residents. Being so close to the heart of Ontario and just south of cottage country, Barrie is the perfect place to set up home and live in a calm oasis year-round, while still enjoying the amenities of a small city.
Barrie Market Cooling with the Summer Fades Away
After record sales month after month, the Barrie real estate market is finally seeing unit sales decline. At the end of September 2021, the MLS System of the Barrie & District Association of REALTORS® recorded 449 unit sales for the month – while this was slightly above both the five- and 10-year averages for the month, a 25% decrease when compared to September 2020.
When considering the year-to-date tally of home sales, the first nine months of this year totalled 5,141 units sold. When compared to the first nine months of 2020, this is a significant 18.6% gain.
Following the trend of the Greater Barrie area, the City of Barrie also experienced a decline of -31.1% on a year-over-year basis, with residential sales hitting just 224 units during the month of September. “Despite coming in lower compared to the astronomical record seen this time last year, home sales still posted one of the best levels on record for the month,” said Chantal Godard, President of the Barrie & District Association of REALTORS®.
The number of new listings posted in the month of September also declined when compared to last year. With just 589 new residential listings this past month, the year-over-year metric has seen a steep decline of 20.4%. Not only is this below both the five and ten-year average for the month, but it was also the lowest number of new listings in the month of September in more than five years.
The low number of new residential listings combined with a moderate amount of unit sales for the month, led to a 38.2% decline in active residential listings at the end of September. Active residential listings have not been this low in September in more than 25 years; they were also 63.4% below the five-year average and 66.4% below the 10-year average for the month – both quite substantial declines.
Despite these considerable declines of new listings compared to typical levels, it is still enough to just keep the market afloat. Godard adds: “Most of the strength in sales activity can be attributed to the supply of new listings hitting the market, compared to other markets where new listings have fallen off and there just isn’t enough homes on the market to buy. That said, even with new supply as supportive as it is, we are still facing a continuous decline in overall inventories as demand remains very strong for properties in the region.”
A consistent demand coupled with limited supply has yet again caused the average price in the region to increase. The MLS Home Price Index (HPI) composite benchmark price was $756,800 this past month which is 34.2% higher than the benchmark price of a residential property in Barrie in September 2020. The major contributor to this price gain is the cost of a single-family home; the benchmark price of which was $793,800 during September 2021.
In terms of year-to-date comparison, the average price for the first nine months of the year was $809,706 – up sharply by 31.4% compared to the first nine months of 2020.
Will the Cooling Trend in the Barrie Real Estate Market Continue?
As the year winds down, demand for homes in the Barrie housing market could begin to ease, creating an opportunity for new listings to grow and inventory levels to bulk up and price growth to slow down. This could be great news for hopeful homebuyers who have been side-lined for well over a year now, holding out for this long-awaited market cooling.