Cornwall housing market to favour sellers in 2021, prices expected to rise 10%
Cornwall real estate is in store for another seller’s market in 2021, attributed to a housing supply shortage, growing demand and rising prices. Inventory challenges have been trending in many Ontario housing markets, pushing prices upward. Indeed, single-detached homes in Cornwall saw prices rise to an average $263,000 in 2020 (Jan. 1-Oct. 31) compared to $232,000 in 2019 (Jan. 1-Dec. 31). During the same period, the average price of condominium properties in the region increased to $253,000, up from $213,000 in 2019. Low supply and rising demand are expected to be a continuing factor in 2021 market activity. Thus, the RE/MAX outlook for Cornwall real estate is an increase of 10% in average price to $5286,000 across all property types. Sales are expected to remain on par with 2020 levels, due to lack of inventory and limited new construction.
The region currently has a couple of months of housing inventory, which is not expected to change in 2021 due to demand from out-of-town buyers relocating into Cornwall.
Who’s driving the Cornwall housing market?
The Cornwall housing market is experiencing growing demand across all property types. The local market is being driven primarily by “move-over homebuyers,” who are commonly seeking out single-storey detached houses and townhomes. Buyers want more space, which is a trend that’s been intensified across Canada and overseas due to COVID-19. Cornwall’s price per sq. ft. is lower when compared to that of larger cities. These move-over buyers are relocating with considerable equity, which allows them to “trade up” into larger homes in this area.
The typical first-time homebuyer in the area is young couple in search of townhomes in the $200,000 to $300,000 price range. First-timers have not shown any hesitation in entering the market in 2020 due to limited inventory, which is expected to continue in 2021.
Move-up buyers in the area are typically families who. Like their first-time counterparts, have not shown any hesitation in entering the market due to limited housing supply. Their challenge in 2020 has been limited supply and rising prices, which has made it more difficult for them to get financing. These conditions are expected to persist in 2021.
Cornwall’s condo market is being driven by retirees and empty who are looking to downsize their living spaces. Limited inventory and a lack of new developments has played a larger role in driving up prices. Condo sales have remained relatively stable through 2020, due to the scarcity of condos in the region along with very few cases of COVID-19. This is expected to continue in 2021.
Luxury homes in the Cornwall market are seeing higher demand from buyers who are relocating from large metro cities. With close proximity to Montreal and Ottawa, buyers are able to get more home for their dollars in Cornwall. Luxury home prices and demand have increased as the result of an exodus of larger urban areas. The majority of these buyers are empty nesters with equity from the sale of their principal residence in larger cities. This increased demand is expected to continue in 2021.
Cornwall’s hottest neighbourhoods
The Cornwall real estate market saw the greatest number of transactions in the neighbourhoods of Riverdale, Long Sault and Glen Water. This should continue in 2021, with North Cornwall also expected to see increased activity, due to active new construction in the area.
Cornwall new-home construction
There are no new large construction projects expected in Cornwall. Local builders’ developers have been hesitant to take on larger projects, and this has not changed. Historically, Cornwall’s new-home market has been flat, and the large supply of existing homes has always kept a new home price low, making it less attractive for developers. Most new product is built to suit with firm agreements on hand. It is likely that any new construction would be quickly absorbed by out-of-town buyers.
Canadian housing market in 2021
Canadians are on the move. RE/MAX isn’t calling this an “exodus,” but the re-location trend across the Canadian housing market is real, and it’s just one focus of the RE/MAX 2021 Housing Market Outlook Report. RE/MAX Canada anticipates healthy housing price growth at the national level, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing and widespread housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.
Due to these factors, the 2021 RE/MAX 2021 outlook for average residential prices is an estimate of +4% to +6% nation-wide. Here’s the regional break-down:
Additional report findings include:
- 35% of RE/MAX brokers indicate that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021
- 45% of RE/MAX brokers indicate that move-up buyers will likely be a primary driver of the housing market demand in 2021
- Half of Canadians (53%) are confident that Canada’s housing markets will remain steady in 2021
- 52% of Canadians believe real estate will remain one of the best investment options in 2021
“We’ve seen a lot of anecdotal evidence since the summer that households are considering significant lifestyle changes by relocating to less-dense cities and neighbourhoods,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “This has sparked unprecedented sales this year in suburban and rural parts of Canada and we expect this trend to continue in 2021.”