It’s no secret that demand for homes in Waterloo Region is sky-high.
Low interest rates, remote working, and the home’s more important role in our day-to-day lives have prompted many Ontarians to either renovate or make their move to their forever home, their cottage escape, or to downsize.
Remote working, in particular, has had a massive impact on not just our market, but on markets across North America. Many buyers, no longer restricted by their morning commute, are now free to buy wherever they like — often in markets that offer more affordable housing.
Unsurprisingly, prices in Kitchener, Waterloo, and Cambridge — only an hour from the much-more-expensive downtown Toronto – have risen sharply.
But we’re far from alone.
Other markets in Southwestern Ontario have also experienced tremendous price growth.
And while we normally wouldn’t focus on markets 2-3 hours to our west, the landscape has changed. It’s critical from a planning standpoint to understand price trends in outlying areas. The trends in these markets, and the opportunities that accompany them, are impacting the buying, selling, and investment strategies of many of our clients. Depending on your goals and timelines, they may impact your next move as well.
So, we dug into the numbers.
We evaluated home values across 10 Southwestern Ontario markets (including our own) to see how they’ve performed both in 2021 and over the past 12 months.
Our goal is to help you understand how each market has shifted, where things sit today, and where growth opportunities may exist.
In most cases, we used the benchmark prices from the MLS Home Price Index to provide a more accurate apples-to-apples comparison (a few markets only report average prices).
To start, let’s see what’s happened so far in 2021:
For context, Waterloo Region, pre-2016, had been accustomed to 3-4% growth. YEARLY.
And while 15-17% local growth is impressive, Windsor, Chatham, and other smaller markets to our west increased by even more – a trend that will become even more pronounced in our next chart…
The Past 365 Days:
62% in Windsor. 50% in Woodstock and, yes, 40% in K-W. All of these numbers are staggering.
Even if home values level off, as they have in April and May, homeowners in all of these markets have experienced significant equity gains that, at that 3-4% pace mentioned earlier, would take a DECADE to realize.
Our final chart shows you just how much this means in terms of real dollars:
Current Values with 1-Year Gains:
This is a loaded chart, but it’s helpful to see this data together.
In grey, you’ll see the benchmark prices for every market, lowest to highest. Waterloo-Wellington boasts the highest values, while Chatham-Kent homes are about half the price:
The red bars represent the value gained in each market (using the composite benchmark or average prices where available). 213k in K-W, 198k in Woodstock, 130k in Sarnia — all massive increases. Here are all the year-over-year increases:
Finally, there’s the green line which represents the percentage growth in each market over the past year. Here, you’ll notice that some of the highest growth rates were in the markets with the most affordable homes.
No matter how you slice it, all of these markets experienced substantial growth.
While prices are leveling off at the moment, demand is still high and the mobility afforded by remote working will continue to allow buyers to move about the province.
Much like how water always flows downhill, homebuyers will continue to seek affordable options, especially with the new mortgage stress test now in place.
Depending on your real estate goals — investing, downsizing, or otherwise — it would be prudent to pay attention to other Southwestern Ontario markets, speak with real estate professionals who serve them, and understand the opportunities beyond the K-W-C bubble that could help you meet your real estate goals at potentially lower prices.