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Niagara-on-the-Lake
Thursday, October 6, 2022
Average NOTL house prices break the $1 million barrier
DougRempel_2

With low inventory, costs are expected to keep climbing

 

House prices in Niagara-on-the-Lake soared to record levels in 2021 and the president of the Niagara Association of Realtors sees no sign of the trend abating.

The benchmark average price for homes sold in NOTL last year broke through the $1 million barrier for the first time as prices jumped about 33 per cent.

Doug Rempel, of Bosley Real Estate in NOTL and president of the regional association, expects home sales across Niagara will continue to climb.

“I think the demand of people coming to the Niagara Region is not going to subside,” Rempel said in an interview Tuesday. 

“I believe that we may very well have an increase greater than what may be projected nationally,” he added. 

While it's impossible to predict with certainty, across the country prices are expected to rise about 7.5 per cent in 2022. “I think we might see 10 per cent” in Niagara, Rempel said.

NOTL prices on the realtors' housing price index – a compendium of statistics that measures housing costs – topped $1.043 million to end 2021, up from $786,000 a year earlier. Real estate in NOTL remains the most expensive in Niagara.

The town's “unique and iconic” nature plays a role in that, Rempel noted. But there are numerous factors influencing the cost of resale homes. One of the big ones is what the industry calls inventory – the number of homes on the market.

Today, there are simply more people looking than there are selling.

“When you have a lack of inventory, supply and demand will continue to push hard on prices,” he said.

“A lot of people recognize the wonderful opportunities of coming down to the Niagara region and the Niagara peninsula, where they could keep the equity they have in their home in the GTA and do very well” in this market.

COVID also has been a factor in attracting newcomers, he noted, as more people are working from home, their children have been doing online schooling and lifestyles have changed. And many find their buying power goes further in Niagara, he said.

No one has a crystal ball to see what the future holds, but Rempel is confident the real estate market will remain stable.

He downplays media chatter about a housing bubble or other problems on the horizon. 

“I don't think for one moment that there is anything to suggest that there would be any kind of a bubble that's going to burst. There is absolutely no justification for that kind of conversation,” he said,

“The fact that the market has gone up has had a lot to do with supply and demand in the Niagara region, an increased awareness of the opportunities that are here, the low cost of borrowing money, and all those factors coming together.”

But what about young families or those who grew up in Niagara-on-the-Lake, will they ever be able to own here in town?

Rempel acknowledges that buying in Old Town might be tough, but believes with a sound strategy – and some patience – eventually calling NOTL home is possible.

Having a downpayment is one of the first hurdles to be overcome. Many younger people are paying as much or more in rent than they might on a mortgage. While many parents try to help their kids financially, not everyone has that luxury.

Rempel's advice is to be realistic about what you can afford, start small and maybe in a lower-priced market like St. Catharines, Niagara Falls, Thorold or Welland. But “know your limits,” he cautions.

Understand your needs, get properly qualified for a mortgage and create a long-term plan, whether it's five years or more, and through careful acquisitions, you could make living in NOTL a reality.

“Now is a good time to get in and I think to wait is only going to cost more because there's nothing to suggest that prices are going to go down,” he said.

“The cost of borrowing money today is really good. And so if you can qualify for a mortgage and get into the market today, that's a really important step. But don't go beyond your expectations.”