The frenzy finally appears to be over for the London real estate market.
Six monthly records in a row were shattered in the first half of the year and July fell just shy of a record. But August sales were down 10.7 per cent compared to the same month last year.
The London-St. Thomas Association of Realtors (LSTAR) said 892 homes sold last month, compared to 999 in August 2016.
The average price of $326,122 was down 1.4 per cent from June, but still up 18 per cent from a year ago.
This year’s hot area real estate market has been credited in part to a spillover from the Greater Toronto Area. With single-family homes fetching more than $1 million in Toronto, London-St. Thomas realtors say buyers from there were snapping up homes here and driving up prices.
“I think there is a ripple effect from Toronto. It’s still a seller’s market, but I think it has peaked,” said LSTAR president Jim Smith.
Heather Virtue, a realtor who founded her own brokerage last year, said “bully” offers — big bids designed to daunt competitors — are becoming more scarce.
“It was crazy in the spring. Torontonians were coming down and offering $100,000 over asking (price). But in the last two months, it has balanced out, cooled off. It’s gone from fireworks to more like a sparkler,” she said with a laugh.
It could be those deep-pocketed GTA buyers are worried about selling their own homes. The Toronto Real Estate Board said sales were down 40.4 per cent in July from the same month last year. July prices were down 4.6 per cent from June, but still up 18 per cent compared to a year ago. (August figures are not yet available.)
Home sales and prices in Toronto began to drop in April after the province imposed new rules to curb speculators and foreign buyers.
Smith said London-St. Thomas sales always have been more balanced and continue at a “healthy pace.”
Even with August’s slowdown, 8,421 homes have sold in London-St. Thomas so far this year, up 15.5 per cent from last year. Smith said there is usually a summer slowing due to holidays, but the market could pick up in the fall.
Smith added some buyers are holding back waiting for the market to stabilize.
“People are still putting their houses in, expecting five to 10 offers and $50,000 to $70,000 over asking, but that ship has sailed. It’s a more normal situation,” he said.
The August sales included 712 detached homes sold, a decrease of 11.4 per cent from the previous year, while condominium sales were down 7.7 per cent from 2016, with 180 units sold.
Although the average sale price fell from June to July, the average year-to-date sales price, at $329,745, was up 18.2 per cent from the 2016 average of $279,057.
In August, there were 1,157 listings, down 9.3 per cent from the same time in 2016.
The year-to-date sales are ahead by 15.5 per cent, with a total of 8,421 homes sold.