Winnipeg’s Real Estate Market: A Decade of Steady Growth
November 23, 2020
Since the pandemic all but snuffed out the spring real estate market in Winnipeg and the rest of Canada, we’ve seen an impressive bounce back across the nation, with Winnipeg sales jumping up 36% since October 2019.1
In an unprecedented year like 2020, following the typical industry practice of comparing current market numbers to the same month last year is useful in understanding immediate market changes; however, the year-over-year view doesn’t show how those changes fit into the context of longer-term market trends.
To find out how Winnipeg’s current real estate market stacks up in the broader context, we’re taking a look at the last 10 years of October sales and price growth (because real estate activity can vary considerably from month to month), examining some of the factors that could be contributing to its even-keeled characteristics.
With the exception of this year, the number of residential sales in Winnipeg hasn’t varied much over the course of the decade, which is a good indication of its relative stability. And although sales in October 2010 were low by comparison, the number signals just how well Winnipeg’s real estate market was doing after the global financial crisis of 2008-2009: year-over-year sales were down only 3% in October 2010, which was less of a decline than in some of Canada’s other major markets.2
The biggest deviations from the upward trends in sales came in 2014-15 and again in 2017. The first follows the near-recession of 2014 after global oil prices plummeted, which led to many job losses in the city3 and in the rest of the country. Still, the difference in unit sales from the previous high in 2013 (at 1,196 sales4) and the lowest point of the decline in October 2015 (at 1,0845) is only 112 transactions – hardly bringing the market to its knees.
The second decline followed the country’s 2016 introduction of the “stress test,” which required that all insured mortgages (that is, mortgages with less than a 20% down payment) be able to withstand interest hikes as high as the five-year standard rate of 4.64%.6 Though the new measures put a 10% dent in year-over-year sales, the difference in actual sales is a less-impressive 115 units.7
While October 2014, 2015, and 2017 numbers show the market’s susceptibility to larger economic pressures, their fluctuations aren’t extreme, and the upticks in 2016 and 2018 (when an additional stress test was introduced on uninsured mortgages) point to its ability to quickly recover.
A few factors help Winnipeg maintain its relative stability in sales. The city has seen mostly balanced markets over the last 10 years, which helps stabilize price and, in turn, allows housing to remain some of the most affordable of any major market in Canada.
Adding to the city’s upward-trending sales in the first half of the decade were low rental vacancy rates – the result of the province’s robust provincial immigrant nominee program that left the expanding population with fewer rental options and pushed many people toward homeownership.8
The province also benefits from a strong, diverse economy spanning multiple sectors, including aerospace, agribusiness manufacturing, information and communications technologies, mining, and transportation. This diversity has allowed the province to absorb economic downturns better than places like oil-dependant Calgary, which helps keep unemployment low and supports residents’ buying power. Wondering if you should buy a home in Winnipeg? Read on.
Like most major Canadian markets, Winnipeg has seen prices gradually increase over the last 10 years, in part due to its healthy balance of listings to buyers (which avoids prices being driven up by competitive markets), and, in part, due to normal economic inflation.
Before 2016, Winnipeg’s real estate association, WinnipegREALTORS®, didn’t publish the average price of homes in their monthly statistical updates, but they have consistently reported which price ranges were most active each month. Knowing what percentage of sales occurred in each range – which are measured in $50,000 increments – helps to see how prices are trending in both the short- and long-range.
The decade has seen sales activity for detached homes gradually moving up in price. In October 2010, the majority of sales (25%) were for homes priced between $150,000 and $199,999.9 This October, only 8% of sales fell into that range, with 34% of sales evenly split between the higher $250,000-$299,999 and $300,000-$349,999 ranges.10
It’s important to note, however, that increased activity in the upper ranges can also be an indicator of growth in the move-up market (buyers who are selling an existing house and using their equity to purchase a more expensive house) and a decline in first-time homebuyers entering the market in the lower ranges. Such was the case in October 2017, when the stress test heavily affected first-time buyers’ ability to secure a mortgage11 and contributed to a 4% year-over-year decline in activity in the $150,000-$199,999 price range.12
How October 2020 Compares
In contrast to a decade of steady sales and comfortable price growth, Winnipeg’s market this October is something of an anomaly. Across the country, surging demand for detached homes has catapulted sales numbers to surprising heights – the result of historically low borrowing rates and a desire for more space as many people are forced to spend more time at home.
Winnipeg’s market is following suit: record-breaking sales for October and a 9% decrease in new listings compared to October 201913 have kept the city in a seller’s market, with sales in the $300,000-$349,999 price range reaching a 10-year high. Over 20% of October 2020 sales fell into the next two ranges above, $350,000-$399,999 and $400,000-$449,999.14
So, what does the long-range look tell us about the current real estate market in Winnipeg? Overall, the outlook is positive. While no one is able to predict how such impressive numbers will play out over time, a recent Nanos Research survey suggests that Canadians are feeling confident about current home prices, with 45% believing the value of real estate in their neighbourhood will go up, and 36% believing it will stay the same.15 Whether the future brings highs, lows, or balance, looking at the last decade makes one thing clear: through the country’s ups and downs, the Winnipeg real estate market is characterized by resilience.
In a time like this, the insights provided by a REALTOR® are your best guide. Local Purplebricks REALTORS® know the Winnipeg market and can help you get the best price when you sell your home, all while keeping your family’s safety a top priority. And, with our low fixed fee, Purplebricks sellers save thousands in commission! Last year, we saved Canadians an average of $13,500.† And if buying is on the horizon, our dedicated REALTORS® can help you navigate shifting markets. We’ll find your dream home and give you $2,000 cash back* when you make your purchase! In any market, Purplebricks is here for you. Call 1-855-953-9533 to start your real estate journey.
1. WinnipegREALTORS® October 2019 Market Report & WinnipegREALTORS® October 2020 Market Report
2. WinnipegREALTORS® October 2010 Market Report
3. WinnipegREALTORS® October 2015 Market Report
4. WinnipegREALTORS® October 2013 Market Report
5. WinnipegREALTORS® October 2015 Market Report
6. CBC News: OSFI Mortgage Rules
7. WinnipegREALTORS® October 2016 Market Report & WinnipegREALTORS® October 2017 Market Report
8. Winnipeg Real Estate News: Winnipeg’s housing market over 50 years
9. WinnipegREALTORS® October 2010 Market Report
10. WinnipegREALTORS® October 2020 Market Report
11. WinnipegREALTORS® December 2017 Market Report
12. WinnipegREALTORS® October 2017 Market Report
13. WinnipegREALTORS® October 2019 Market Report
14. WinnipegREALTORS® October 2020 Market Report
15. Weekly Bloomberg Nanos Canadian Confidence Index, November 9, 2020