The approximate truth about Saskatoon’s luxury homes market

The Saskatoon real estate market saw another home sell above the $1-million mark this week. It’s kind of a big deal because it doesn’t happen very often though it’s certainly becoming more common. This particular sale brings the total number of Saskatoon homes that have sold this year, above the $1-million mark, to seven. That’s pretty impressive. In fact, it’s a new record number for this city. There hasn’t been another year during which seven Saskatoon homes have sold for more than $1-million and we’re not quite two-thirds of the way through the year.

It got me thinking about Saskatoon home price trends in recent years. Each year, at some point, a real estate agent or some other industry insider mentions to the media that sales of homes priced above $500,000 have skyrocketed. I’ve been one to point that out from time to time. On the surface, the trend does appear to be quite significant. Even as early a 2010 home sales priced at or above $500,000 had a total share of the market of just 4.8 percent. This year, it’s up to 8.1 percent, year-to-date. Wow!

So, I got to asking myself some questions on the topic. How much of that change can be accounted for by simple appreciation in the market? Are people actually buying more house or are they simply paying more for houses? I created a chart that contains info on three sets of Saskatoon housing data over the better part of the last five years. Here it is.

Click for a larger version of the chart.

The blue line represents the growing share of Saskatoon home sales, priced at or above the $500,000 mark. Ba-zing!

The red line represents the rather stable share of sales of homes that are 2,000 square feet or more in size and perhaps provides the most objective benchmark of change. It’s actually at its lowest point in five years at only 4.3 percent of the market, but it fluctuates between that and its high point of 4.7 percent. Meh!

Finally, data in the green line recognizes and accounts for increases to the price of a Saskatoon home over the past few years. A $500,000 home in 2012 is not the same home as it was in 2008. In fact, using the compounding effect of the increase in the median sale price of a Saskatoon home between 2008 and now, 2008’s half million dollar home may now cost as much as $590,000. Using that number, we see a pretty sharp decline in the share of the market that this particular home is claiming. Yikes!

In reality, higher-end homes haven’t appreciated completely in step with the market, so the true picture of the Saskatoon luxury homes market is likely better than the green line suggests. If the appreciation in this range is two-thirds of that seen in lower priced homes it would put the green line at 4.7 percent in 2012, about where it was in 2008. Yawn!

Not that much has changed in Saskatoon’s luxury housing market other than the price of those homes.

I’m always happy to answer your Saskatoon real estate questions. All of my contact info is here. Please feel free to call of email me.

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Norm Fisher
Royal LePage Saskatoon Real Estate

A closer look at the Saskatoon real estate statistics for November 2010

On December 1, the Saskatoon Region Association of Realtors reported November 2010 results for the entire residential category of Saskatoon real estate including single-family homes, condominiums, semi-detached properties, duplexes, mobile homes and vacant lots. Unit sales totaled 283 including all of these property types, an increase of twelve percent compared to the same month last year when 253 residential properties changed hands. Driven by a surge in upper end sales, the average selling price of a Saskatoon home came in at record setting $312,893 last month for a year-over year gain of $35,000 (thirteen percent). This post will provide a closer look at how single-family detached homes (houses) and condominiums did in comparison to the entire residential category.

Saskatoon house sales bucked normal seasonal trends and took a big gain on a month-over month basis, climbing by twenty-seven units from October to 208 sales. House sales gained even more on a year-over-year basis with an additional 40 homes trading compared to last November for a gain of nearly twenty-five percent.

Listing inventory took a big slide over the month falling from 697 to 575. The combined effect of higher sales and declining listings pushed total months of available inventory sharply lower from October by 1.1 months to just a 2.8-month supply, below even last year’s number by 0.2 months. Still, the total number of house listings on the Saskatoon multiple listing service stood higher than last November’s 500 units.

The average selling price of a Saskatoon house came in at $326,191 for a gain of nearly nine thousand dollars compared to October, and up more than twenty-six thousand dollars when compared against the same month last year. The median price edged higher gaining $6900 on the month to $306,900. It picked up nearly twenty-five thousand dollars from the same month a year ago. The three-month average edged lower from last month to $328,000 for an annual gain of about twenty-three thousand dollars.

Saskatoon condo sales continued to decline slipping six units from the previous month to finish November at just sixty-one sales, well off of the seventy-six units that sold in November of 2009.

The total inventory of active condo listings fell by ten percent, just as it did in October. At the close of the month there were still 362 units available for sale, roughly twenty percent higher than it was at this time last year. Total months of inventory remained steady at 5.9 compared to October, but was up substantially compared against November of 2009 when the supply had dropped to 3.8 months.

Some strong sales activity at the upper end of the Saskatoon condo market, including three sales that accounted for more than two million dollars in volume, pushed prices to records levels. The average selling price closed November at nearly $280,000 to record a monthly gain of twenty-eight thousand dollars and an annual gain of more than thirty thousand. The median price moved up seventeen thousand dollars from the month before to reach its peak for the year, $257,000. That’s thirty-three thousand dollars higher than last November. The three-month average grew to $255,582 picking up nearly ten thousand dollars on the month for a year-over-year gain exceeding thirty thousand dollars.

A map displaying the boundaries of Saskatoon real estate areas is here.
An overview of data collection and calculation practices for our statistical reports is here.

I’m always happy to answer your Saskatoon real estate questions.  All of my contact info is here. Please feel free to call or email.

Norm Fisher
Royal LePage Saskatoon Real Estate

A closer look at the Saskatoon real estate statistics for October 2010

On November 1, the Saskatoon Region Association of Realtors reported October 2010 results for the entire residential category of Saskatoon real estate including single-family homes, condominiums, semi-detached properties, duplexes, mobile homes and vacant lots. Unit sales totaled 262 across all of these property types, a decline of roughly thirteen percent compared to the same month last year when 309 residential property sales were completed. The average selling price came in at $293,929 last month for a year-over year gain of $19,050 (seven percent). This post will provide a closer look at how single-family detached homes (houses) and condominiums did in comparison to the entire residential category.

After showing a modest month-over-month increase in September, sales of houses returned to a more typical seasonal downward trend. The total units sold in October came in at 181, down from 206 the month before and lower than the 196 sold in October of 2009.

Listing inventory also eased, sliding lower from 766 in September to fall below 700 for the first time since March and closing October with 697 Saskatoon houses displaying an active status. Still, total months of inventory increased by .2 months when compared to September to finish the first month of the final quarter of 2010 with a 3.9 month supply, up from 2.8 months at this time last year.

House sale numbers in all price categories above $200,000 managed to hold their own on a year-over-year basis. All of the declines in unit sales of single-family homes could be counted in the $200,000 or lower price ranges. In spite of this change, which likely skews prices higher, the average selling price of a Saskatoon house fell lower on a month-over-month basis, slipping to $317,544 from nearly $340,000 the month before, but managed to maintain very small gains over October of 2009 when the average sale price was $312,938. The median sale price tumbled to $300,000 from $323,000 the month before to finish just four thousand dollars ahead of last October’s number. The three-month average inched up over the one-month period to $332,855 maintaining big gains on the same month in 2009 when it was just $307,106.

Saskatoon condo sales took a pretty nasty turn in October falling to just 67 units, a decline of 23 from the previous month and down from 103 units in October of 2009 to record a 35% year-over-year drop. The average number of days to sell those units increased 50% compared to last October at 62.

The total inventory of active condo listings slid nearly ten percent from the previous month to close October at 393. The corresponding decline in unit sales pushed months of available inventory substantially higher to 5.9. That’s a full month higher than it was at the close of the previous month and nearly double what it was at the close of October 2009 when there was a 3.1-month supply.

Similar trends that were discussed earlier in the overview of the decline in house sales are at play with condos. Year-over-year, thirty-one of the thirty-six-unit drop came out of the “up to $200,000” ranges. When a third of the sales are lost and nearly all of them are at the low end, prices will naturally be skewed higher. The average selling price of a Saskatoon condo slipped almost five thousand dollars from September to $246,275 by the end of October. On a year-over-year basis it managed to register a huge (17.5%) gain, up from $209,614 for the same month last year. The near absence of condo sales below $100,000 mark caused the median sale price to spike higher, gaining more than 20% on the year to close at $240,000. The three-month average also pushed higher by five thousand dollars on the month, picking up almost $24K on a year-over-year basis.

A map displaying the boundaries of Saskatoon real estate areas is here.
An overview of data collection and calculation practices for our statistical reports is here.

I’m always happy to answer your Saskatoon real estate questions.  All of my contact info is here. Please feel free to call or email.

Norm Fisher
Royal LePage Saskatoon Real Estate

A closer look at the Saskatoon real estate statistics for September 2010

On October 1, the Saskatoon Region Association of Realtors reported September 2010 results for the entire residential category of Saskatoon real estate including single-family homes, condominiums, semi-detached properties, duplexes, mobile homes and vacant lots. Unit sales totaled 304 across all of these property types, a decline of roughly 13.5 percent compared to the previous September when 351 residential property sales were completed. The average selling price came in at $312,582 last month, a gain of roughly $33,125 (eleven percent) when compared to September of 2009. This post will provide a closer look at how single-family detached homes (houses) and condominiums did in comparison to the entire residential category.

After four consecutive months of slow declines, Saskatoon house sale numbers inched up slightly on a month over month basis, finishing just two sales ahead of August at 206. Year-over-year declines continued as sales fell by thirty units, or fourteen percent when compared against the same month last year. Once again, sales of houses below $350,000 took a real beating falling from 178 in September of last year to 130 a year later. At the same time, sales of houses in the $351,000 and higher range increased from 58 units a year ago to 75 sales this September.

The inventory of available homes in the single-family category declined marginally over the past month falling from 773 at the close of August to finish September at 766. Combined with more stable unit sales, the small decline had the effect of lowering “months of inventory” which fell to 3.7, down by just 0.1 months. Compared to September of 2009, total months of inventory grew substantially from a low 2.5 month supply.

For the second month in a row the shifting in the price ranges of houses that sold wreaked havoc on the average selling price of a Saskatoon house, pushing it to its highest point ever, $339,692 to eclipse its previous record set in June of 2008 by just $114. That number is up roughly twelve percent from September 2009. Naturally, the median price remained high at $323,000 gaining $1,000 on the month and $28,000 on a year-over-year basis. The three-month average selling price picked up $6,000 over August numbers to finish the month at $331,822 up from $308,882 in September of last year. The average price per square foot paid for a Saskatoon house also saw a jump of about eight percent on a year-over-year basis, climbing from $246 last year to $266.

Saskatoon condo sales slipped low again for the third consecutive month, sliding from 95 in August to 90 in September. At the same time, condo sales dropped just seven units from the same month last year, a decline of seven percent, roughly half of the drop than we saw in single-family homes. We see a similar shift in the price range of condos that are selling as unit sales below $250,000 drop from 71 in September of last year to 54. Sales of Saskatoon condos from $251,000 and higher experience an increase from 26 units a year ago to 36 units this year.

Condo inventory closed the month of September sharply lower on a month-over-month basis falling a little more than ten percent to 437 units, still a fair bit higher than it was at the close of the same month last year when just 351units showed an active status on the Saskatoon MLS system. Total months of inventory slipped slightly lower over the month to finish just below the five-month mark, up from 3.6 months a year ago.

The average selling price of a Saskatoon condo approached record levels hitting numbers that seem to defy all logic. The average for the month was $250,917, up from $241,440 in August and higher than the $226,271 recorded in September of 2009. The median selling price remained stable when compared to the previous month coming in at $234,000 to record a gain of $17,000 over the same month last year. The three-month average showed a small decline on the month slipping to $243,378 to maintain a gain of roughly $17,700 over the same month in 2009. The average price paid per square foot of Saskatoon condo was up to $251 in September, up from $219 a year ago.

A map displaying the boundaries of Saskatoon real estate areas is here.
An overview of data collection and calculation practices for our statistical reports is here.

I’m always happy to answer your Saskatoon real estate questions.  All of my contact info is here. Please feel free to call or email.

Norm Fisher
Royal LePage Saskatoon Real Estate

A closer look at the Saskatoon real estate statistics for August 2010

The Saskatoon Region Association of Realtors recently reported August 2010 results for the entire residential category of Saskatoon real estate including single-family homes, condominiums, semi-detached properties, duplexes, mobile homes and vacant lots. Unit sales totaled 313 across all of these property types, a decline of roughly twenty percent compared to the previous August when 392 residential property sales were completed. The average selling price came in at $305,866 last month, a gain of roughly $22,500 (eight percent) when compared to August of 2009. This post will provide a closer look at how single-family detached homes (houses) and condominiums did in comparison to the entire residential category.

House sales continued to decline, slipping 20 units compared to July to settle at 204, roughly twenty-four percent behind last August when 268 Saskatoon houses changed hands. After showing a decline in July, active house listings moved higher again in August gaining 40 listings to finish the month at 773. Last year at this time, single-family inventory sat at 651 so the additional 122 properties produce a gain of nearly nineteen percent over last year. The total months of supply of houses grew to 3.8 months, up .5 months from July, and .4 months ahead of where it was last year at this time.

The average selling price of a Saskatoon house surged higher reaching a near record level of $337,614 to mark a gain of more than $18,000 on the month and finish ten percent higher than it was at the close of the same month last year. The median price jumped even more, moving $21,000 compared to July and $30,000 year-over-year. The three-month average selling price gained nearly $5,000 from last month and finished more than $17,000 higher than it was at this time last year.

I wrote a bit in this post about a skewing of the average numbers that occurred in August because of a significant decline in the number of sales below the $300,000 mark and a small increase in the number of homes that sold in price ranges above $300,000. I believe that at least some of the gains we’ve seen in this month’s average are artificial (not reflective of actual value changes), caused primarily by a change in what types of houses have been selling. The price per square foot (PPSF) numbers seem to support that. The PPSF of a Saskatoon house fell to $242 from $252 last August. Last month’s PPSF is the lowest recorded for any month this year, and well off of the $270-$275 that it has been running at since April. Some of the decline can be explained by the fact that larger homes traded this August (PPSF generally declines as house size increases) but regardless of how you chose to view things, it would be difficult to make a strong argument that prices are actually up ten percent when the PPSF is down by nearly as much. It simply doesn’t add up.

Saskatoon condo sales also took a slide falling to 95 units from 113 the month before, and 112 in August of last year. As demand softened, the supply of active condominium listing available through the multiple listing service edged up 26 units to finish the month at 489, roughly twenty-four percent higher than it was at the same time last year when condo inventory had fallen to 381. The total months of supply based on recent sales took a huge leap gaining a whole month compared to July and 1.7 months compared with the close of August 2009. It currently sits at 5.1 months, its highest point since March of 2009 when it reached 7 months.

Following a five percent slide in the average selling price of a Saskatoon condo through July, prices bounced back a bit as the average gained nearly $2,500 over the previous month to close August at $241,440 and record a year-over-year gain of about $9,500. The median price climbed $11,000 over the month to hit $234,000 and finish $9,000 higher than it was at this time last year. The three-month average remained solid at $244,236, up $22,000 from the close of August 2009.

Average and median prices for Saskatoon condos sold in August 2010

The average PPSF paid for a Saskatoon condo grew by just two dollars over the month to finish August at $235 and record a gain of about seven percent compared to this time last year when it was at $219. The gain is somewhat smaller than we see in the three-month average selling price, which has grown by ten percent in the same period. Unlike single-family homes, which saw a substantial change in the size of the product that traded, the average size of the condos that sold in August were pretty comparable to last year at 1,025 square feet.

A map displaying the boundaries of Saskatoon real estate areas is here.
An overview of data collection and calculation practices for our statistical reports is here.

I’m always happy to answer your Saskatoon real estate questions.  All of my contact info is here. Please feel free to call or email.

Norm Fisher
Royal LePage Saskatoon Real Estate