London real estate: Sales for August were down significantly from a year ago, suggesting the red-hot market is cooling

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The long hot streak in the London area’s real estate market finally appears to be cooling.

London-St. Thomas chalked up record sales in the first six months of 2017. July fell just shy of the record but August sales were down 10.7 per cent compared to the same month last year.

The London Association of Realtors (LSTAR) said there were 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 compared to a year ago.

LSTAR president Jim Smith said despite the decline, sales were continuing at a “healthy pace.” Smith noted that August 2016 set a sales record for the month.

“If you look at the historical data, last year turns out to be the best August for our realtors since 2005,” he said.

While the London market may be cooling, it has not seen the slump that’s hit the Toronto market, where sales and prices began to drop in April after the provincial government imposed new rules to curb speculators and foreign buyers.

The Toronto Real Estate Board said sales were down 40.4 per cent in July compared to the same month last year. August figures are not yet available. Prices were also down 4.6 per cent compared to June but still up 18 per cent compared to a year ago.

The hot real estate market in the London area this year has been partly credited to a spillover from the Greater Toronto Area.

With single-family homes selling for more than $1 million in Toronto, London-St. Thomas realtors say buyers from that area were snapping up homes and driving up prices.

Even with the slowdown in August, there have been 8,421 homes sold in London-St. Thomas so far this year, a 15.5 per cent jump over last year.

“Overall, 2017 remains an incredible year for real estate across London and St. Thomas and we expect sales activity to stay fairly strong for the remainder of 2017,” said Smith.

The surge in the real estate market has spilled into other sectors of the economy, including new homes and renovations, moving and legal services and storage facilities.

The August sales included 712 detached homes, 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.

The average sales price across London and St. Thomas was $326,122, down 1.4 per cent from the previous month. The average year-to-date sales price was $329,745 — up 18.2 per cent from the 2016 average home price 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.

July Home Sales London-St. Thomas (2016 in brackets)

Detached: 712 (804)

Condo: 180 (195)

Total: 892 (999)

Average price: $321,429

hdaniszewski@postmedia.com


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