In this more balanced current real estate market in Cornwall Ontario and the surrounding areas, people from industry insiders to idle observers are speculating about the extent to which condo and single-family home portions of the market have split in two.
Real estate agent Sophie Goudreau of Century 21 Shield Realty Ltd. offers three sales scenarios that provide a good snapshot. The numbers, she believes, illustrate well the divergence in value in the broader market.
“It just seems that people are betting on the single-family house.” assures Sophie Goudreau.
Mrs Goudreau points to the action in a former mattress factory that has been converted to a cool loft building. The second setting small town near Cornwall Ontario. The story starts in 2009, when Mrs Goudreau helped a client sell his loft and buy a detached house in another close by area for $10,000 more than the selling price of the loft.
Now fast forward to October, 2012, and the purchaser of the loft decides to sell. She calls Mrs Goudreau because she knows the unit. Coincidentally, the owner of the house in the small town nearby decides to sell because he’s moving to another town and he too calls Mrs Goudreau. The loft sells for $399,900. The house sells for $440,000.
So, in the same period, the loft increases in value by 19.4 per cent while the house swells in value by 27.5 per cent.
“The single detached home in Cornwall or nearby municipalities is the prize that everyone is after,” says Mrs Goudreau.
Still, Mrs Goudreau did not set an offer date for the house because she knew the market had slowed.
The house was listed with an asking price of $449,900 and sold for $440,000 after eight days.
Mr. Smith says that supply and demand is one factor: many more condos are going up than single family houses in some areas. But also, condo prices have reached a level that doesn’t make sense to a lot of buyers.
Compared with the house, a nearby loft or condo with the same square footage would cost $700,000, says Mrs Goudreau.
“People believe the freehold housing market will keep getting stronger.”
Even freehold houses are taking longer to sell, he notes. Buyers hold more power in this market.
“If the house is over-priced, they’re still letting the sellers sit and sweat. But if you have a reasonable price, people will buy.“