Record June for London-St. Thomas but pace of growth in home prices slowing: LSTAR

FILE. Craig Lord / Global News

The London and St. Thomas Association of Realtors (LSTAR) says June 2021 saw the most home sales of any June on record since it began tracking data in 1978, but president Jack Lane says the rate at which home prices are climbing is starting to slow a bit.

In June 2021, 1,194 homes were sold with an average sales price of $641,072 — up more than 35 per cent from June 2020 but only a 0.78 per cent increase from May 2021.

Read more: Former councillors say City of London can help address rising home costs

Single-family homes continue to account for the bulk of sales, with 892 of the 1,194 homes sold in June.

“I think we’re going to see slow but steady increases over the coming months, but certainly not the big swings that we saw last quarter of 2020 or even the first couple of months this year,” Lane told Global News on Tuesday.

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“I wouldn’t be surprised if we see maybe another five per cent increase over the next six to 12 months, but not 30 per cent.”

Lane says it is still a seller’s market due to low supply but he believes that is starting to change. However, he does not anticipate a buyer’s market in the foreseeable future.

Read more: Kitchener-Waterloo housing prices rise again, realtors say

While the cost of a home in the London region has skyrocketed in the past year, Lane says the cost is still well below average prices in many regions to the east, driving prospective buyers to our region.

Benchmark price for May 2021 ranged from roughly $750,000 in Kitchener-Waterloo to over $1 million in Toronto, according to the Canadian Real Estate Association.

“We’re still seeing an impact from the GTA and other communities to the east of us. I expect that’s going to continue for those people that have been able to adapt to the work at home environment,” Lane says.

“And for some of the baby boomers that we see now retiring and coming out of those higher-priced markets to a great place like London and St. Thomas.”

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Read more: Montreal, Quebec City home prices soared in June while sales fell: QPAREB

Locally, Middlesex saw the highest average price in June at $859,300, followed by London North at $729,338. London East saw the lowest average price at $498,690.

Lane adds that instances of homes being sold for well over asking is decreasing, but due to the fact that listing prices have increased.

For example, he says, a house that might have previously been listed for $695,000 and selling for $750,000 would now be listed for $725,000 and still sell for $750,000.

Click to play video: 'Priced Out: A look at why the hot housing market is out of reach for young Canadians' Priced Out: A look at why the hot housing market is out of reach for young Canadians
Priced Out: A look at why the hot housing market is out of reach for young Canadians – May 28, 2021

The housing market has been of particular concern across Canada as prices shot up during the COVID-19 pandemic.

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The Bank of Canada reported in May that house prices were up 23 per cent nationwide compared to a year ago.

In April, Global News reported that the average national home price was more than seven times the average household income, according to data from the Canadian Real Estate Association and Statistics Canada.

— with files from Global News’ Erica Alini and The Canadian Press’ Jordan Press.

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