May 2021 Another Torrid Real Estate Market In London Ontario And Area
May 2021 was yet another remarkable month for home sales activity in LSTAR’s jurisdiction: the Association recorded 1,258 residential transactions via its MLS® systems – year-to-date sales are at an all-time high. At the end of May, there have been 5,175 sales, up 64.3% over the same period last year.
The overall inventory figure, which shows how long it would take to liquidate the existing housing supply in our area at the current rate of sales activity, remained at 0.6 months – its lowest level in the last decade.
The following table illustrates how last month’s benchmark prices compare to the average sales prices. The MLS® Home Price Index (HPI) benchmark price reflects the value of a “typical home” from a certain area as assigned by local home buyers based on various housing attributes. The average sales price is calculated by adding the sale prices for all the homes sold and dividing that total by the number of transactions. Since monthly averages may be skewed by the type of houses sold in that timeframe, the HPI benchmark price is a more accurate way to gauge price trends.
| Area | May 2021 MLS® HPI Benchmark Price | May 2021 Average Price |
|---|---|---|
| Elgin | $621,400 | $646,427 |
| London East | $506,900 | $502,608 |
| London North | $691,700 | $741,983 |
| London South | $577,100 | $655,662 |
| Middlesex | $856,800 | $808,936 |
| St. Thomas | $507,000 | $547,777 |
| Strathroy | $681,300 | $636,491 |
| LSTAR | $586,200 | $636,053 |
The single-family home remains on top of the local buyers’ preferences, with 937 sales in May. The table below shows the May benchmark prices for all housing types and how they stack against the values from a year ago.
| MLS® Home Price Index Benchmark Prices | ||
|---|---|---|
| Benchmark Type | May 2021 | Change over May 2020 |
| LSTAR Composite | $586,200 | ↑ 42.5% |
| LSTAR Single-Family | $637,700 | ↑ 46.2% |
| LSTAR One Storey | $598,100 | ↑ 49.5 % |
| LSTAR Two Storey | $678,300 | ↑ 43.7% |
| LSTAR Townhouse | $484,900 | ↑ 32.1% |
| LSTAR Apartment | $248,300 | ↓ 8.8 % |
Even though all the increases were seen in the HPI benchmark prices and average sales prices, homes in LSTAR’s jurisdiction appear to be relatively affordable compared to houses from some other major Ontario and Canadian centres. The following table is based on data taken from the CREA National Price Map for April 2021.
According to a research report[1], a total of $73,250 in ancillary expenditures is generated by the average housing transaction in Ontario over a period of three years from the date of purchase.
The pandemic and the newly introduced mortgage stress test have made the home buying and selling processes a bit more challenging, and this is where an experienced Realtor can really make a difference!
