I stood in the dark as Cody (my dog) whizzed on a euonymus. Then came the realization: This bush must be worth a lot. Thousands. He was peeing on the shrubbery of a house just listed for (gulp) $11.9 million.
Seriously. Here. Nice, but not a castle. Big, but no estate. The listing agent, Tom Elltoft, tells me the pool alone is worth a couple of million. It took 120 piles driven into the Lake Ontario shoreline to support it. And there are change rooms buried beneath it.
Notable Americans own this pile near the golf course. “They deal in U.S. dollars,” Tom explains, “and that’s how we got this price.” Well, it’s open for offers (I wiped off the bush).
Up the street, one of the ancient places just changed hands privately. Not grand. Maybe grandish. Folks from the Big Smoke paid $3.8 million. “They just sold in Toronto for $6 million,” my knows-everything neighbour says, “so what’s $4 million?”
Sure. It’s NOTL. We grow money. At least in the Old Town.
Well, it’s clearly time for a real estate update, especially now that we understand where Donald Trump is headed. Expect surprises in the next year or two regarding mortgage rates. More in a moment.
First, wassup with Niagara? Realtors have been making happy noises about sales levels, which took a dramatic turn higher (up 43 per cent) in October.
“It’s a good indicator that things are trending in the right direction and buyers are definitely coming off the sidelines,” says Nathan Morrisette, head wizard of the regional real estate board.
“Buyers are gaining confidence in the market with the Bank of Canada announcement reducing the policy interest rate by 0.5 per cent a few weeks ago and some mortgage rule changes coming in December.”
But not so fast. It’s still taking sellers almost 80 days to find a buyer. In NOTL there’s a supply of unsold homes that will last until next October at this pace, and we’re measuring sales against a very low bar.
“Yes, October of 2024 was a stronger month,” cautions Bosley broker Patrick Burke, “but October ’23 was the worst October in modern times for the number of homes sold in Niagara.”
Burke points out sales are still 10 per cent below the long-term average, while inventory has bloated like a deceased squirrel, at 60 per cent above the 10-year trendline.
“We shall see how many of the active sellers fold up their tents as we get into the winter.”
Prices? Meh. Not much to mention. They’re holding — the average house in all of NOTL still commands about a million. Because most people don’t have seven figures in their savings account, or equity in their home (which is still hard to sell), mortgage rates are critical.
This brings us to the Orange Guy.
Before the U.S. election’s historic outcome, our central bank merrily chopped rates, leading the world in reducing financing costs (as our economy slows).
Then along came Trump, with his avowed policies of trade tariffs, corporate and personal tax cuts, mass deportations and America-first protectionism. Economists have one word for all this change (which has already pushed stocks skyward): It’s “inflation.”
Trump’s win pushed bond yields higher, as traders bet on inflation rekindling. The U.S. Fed boss is rethinking any more rate cuts in the States. The American dollar romped, pushing ours down to 70 cents.
Now, CIBC analysts figure rates are going to level off soon, and possibly rise as Ottawa defends the dollar while price pressures bubble.
What happens if home loans go back to six per cent while we’re swimming in inventory? Plop.
Of course, the elite will still flip houses. You just don’t care about market conditions when you’re rich. Or a dog.
Garth Turner is a NOTL resident, journalist, author, wealth manager and former federal MP and minister.
