London-area homes sales have plunged, with the fewest number of February sales in nearly 30 years.
The London and St. Thomas Association of Realtors (LSTAR) recorded just 436 residential transactions last month, “thus marking the lowest number of February home sales seen by LSTAR since 1995.”
While the number of homes that actually changed hands was low, 761 new listings entered the market bringing the number of active listings to 1,320 by month-end. That puts the sales-to-new listings ratio at 57.3 per cent.
February’s dismal sales followed a sluggish January when only 344 homes were sold. That was the worst January on record since 2009.
Area real estate values also plummeted in February, one year after reaching an all time record high.
According to LSTAR, the average price last month was $621,912, up $36,000 from January but 24.2 per cent lower than February 2022 when the average price soared to $825,221. This is the largest drop since LSTAR began keeping records.
Despite all this LSTAR president Adam Miller noted there are reasons to feel optimistic about the local housing market.
One reason is that the Bank of Canada has signaled that interest rates may have peaked and another is that the consumer confidence index is sitting at its highest level since September.
“The frantic bidding wars of the past seem to be now in our rearview mirror. And home buyers are getting more and more comfortable with taking on variable-rate mortgages, feeling encouraged by this much calmer environment,” said Miller. “In these conditions, the spring market could surprise us.”
The most “desirable” housing type in the London region was single-family homes with 325 transactions recorded. That was followed by condos with 56 units sold. In contrast, only 34 apartment units were sold over the same time period.
“Out of all house types, single-family homes were the ones that drove the month-over-month increases we noticed in the average and benchmark prices,” said Miller. “Last month, the average price of a single-family home was $673,226 in our area, 25.2 per cent lower than in February 2022, but also 5.6 per cent higher than in January 2023.”
