Historic housing correction not likely to impact Barrie's market: BDAR

The president of the Barrie and District Association of Realtors (BDAR) doesn’t believe there will be a massive correction locally on the housing market with supply relatively unchanged, despite a significant correction on the horizon for housing prices in areas that soared during the pandemic across the province.

"It costs more to buy a home that is lesser priced today than it did to buy a home that was higher priced a few months ago because of the interest rate differential. So your monthly payment is higher now even though the home price is lower, and that's going to continue to be a trend," said Luc Woolsey, BDAR.

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Single mom Kathleen Goodman said she would like to get back into the housing market in Barrie.

"We'll be renters and staying where we are for the time being. I guess with the soaring prices. There's just no hope," she said.

A new report by RBC forecasts housing sales will drop about 40 per cent in the next year, while real estate prices will fall about 12 per cent overall.

"We are currently down 18 per cent in that time already here in Simcoe County, so does that mean we've already reached the floor from their prediction? It's really hard to say," Woolsey added.

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"The cost of houses and what you get for your money is just not worth it nowadays," Goodman said.

"It's ridiculous, actually," said Barrie resident Jodi Wilkins, who noted prices in her south-end neighbourhood reached record levels over the past two years.

"For some of the houses here and the sizes, they're quite astronomical. I know one in the neighbourhood for just under 1,100 square feet last year or the year before sold for over $700,000," Wilkins said.

With interest rates being hiked again, RBC expects Canada's overnight rate of 2.5 per cent to hit 3.25 per cent by October, prompting what it fears will cause affordability to sink to its worst-ever levels.

"There's still going to be a demand for housing except that now, with higher interest rates, buyers will have less of a budget," said Robert Hogue, RBC assistant chief economist.

Still, BDAR's president believes the market appears fairly strong.

"Homes that are priced appropriately and show well are still selling," Woolsey said, adding most houses sit on the market for an average of 19 days.

"That's still pretty quick. It seems like a lot versus four days on the market earlier in the year, but it wasn't uncommon a couple of years ago to be six months on the market," Woolsey concluded.