Winnipeg aggregate home prices higher this year, as interest rate fears wane

The federal government is instituting significant changes to Canada's mortgage rules aimed at ensuring homeowners will survive an increase in interest rates. (File image/ The Canadian Press

House-hunting Winnipeggers are expected to pay more compared to this time last year, as experts say once weary buyers are less concerned about the trajectory of interest rates.

Royal LePage’s latest home price update and market forecast predicts the average home in Winnipeg will increase by five per cent in the fourth quarter of 2024, compared to the same period last year.

According to the forecast, the aggregate price of a home in Winnipeg increased 5.7 per cent to $390,000 year over year in the first quarter of 2024. The median price of a single-family detached home also rose. It’s up 5.9 per cent to $431,000, while the median price of a condominium went up by 6.9 per cent to $260,000.

Winnipeg was not alone. The report finds 89 per cent of regions recorded quarterly price appreciation in the first three months of the year ahead of the typically busy spring real estate season.

Winnipeg broker Michael Froese attributes the rises to once sidelined buyers feeling more confident about the trajectory of interest rates.

“Homes in the mid-tier and luxury price points are recording steadily climbing levels of demand, which tells us that the people who didn’t have a crucial reason to move over the past year are now reactivating their real estate purchase plans. Demand for Winnipeg homes never went away – it was just deferred,” he said in a news release.

New homes are built in a housing construction development in the west end of Ottawa on Thursday, May 6, 2021. THE CANADIAN PRESS/Sean Kilpatrick

He adds the city experienced a much more seasonally typical first quarter in 2024 compared to recent years, with market activity ramping up heading into the early weeks of spring.

Still, sales are down from the five-year regional average, year over year.

Demand is three times greater than the available home supply, which Froese predicts will keep prices on an upward trend for the foreseeable future.

The forecast shows entry-level properties, which are under the $500,000 mark, are seeing the most competition, as first-time buyers renew their search for a first home.

He says the second quarter of the year is normally Royal LePage’s busiest time, and 2024 is expected to be no different.

“Though a potential cut to borrowing rates will make things easier for buyers, I don’t expect it will fuel much more demand,” he said.

“A lot of buyers are done with waiting, and having already adjusted to the current rate environment, are moving ahead with their plans to purchase regardless of what the Bank of Canada does next.”

Toronto to outpace Vancouver in aggregate home price this year: forecast

Meantime, the national aggregate rate is expected to rise nine per cent year over year this quarter. That is up from a previous forecast of 5.5 per cent.

No surprise - Winnipeg homes are a steal when compared to Toronto and Vancouver, with the new report pegging the aggregate price of a home in the GTA increasing 5.2 per cent to $1.177 million in the first quarter.

Meanwhile, while Vancouver remains Canada’s most expensive market today, Royal LePage predicts a home in Toronto will surpass Vancouver in terms of home prices in the second half of 2024.

The aggregate price of a home in Greater Vancouver is forecasted to increase 3.4 per cent to $1.238 year over year in the first quarter of 2024.

Other takeaways – Calgary recorded the highest year-over-year aggregate price appreciation at 9.7 per cent for the second consecutive quarter to $647,400 in the first quarter.

The full report can be read on Royal LePage’s website.