The Barrie condominium market continues to be on a slower trend through the final quarter of the year as sellers in Barrie wait for buyers to make a decision on a purchase.
However, it is predicted that real estate sales will rise in 2025 now that Canada has had four consecutive rate adjustments and the cost of borrowing has gone down.
Many buyers who were looking to purchase real estate in Barrie put their search on hold to wait and see how the market was going to respond to the hike in interest rates after the peak of the market in 2022.
After the inflation rate in Canada rose from 0.7 per cent, when the world pandemic was announced, to 8.1 per cent in 2022, the Bank of Canada implemented one of the most aggressive monetary policy-tightening campaigns in history and raised the prime lending rate 10 times in order to bring the rate of inflation down.
It was absolutely crucial for the federal government to step in to help stabilize the Canadian economy as 8.1 per cent was the highest inflation rate recorded since the early-1980s recession.
The increase in interest rates caused consumers to reduce their spending and, over time, helped bring the inflation rate down to the targeted rate in just less than a year. After these positive efforts and six months of maintaining the inflation rate around 2.8 per cent, the central bank felt comfortable enough to begin to slowly reduce the prime rate over the second half of this year.
Although it was speculated that buyers would start to become more active again after interest rates started to decrease, that has not been the case. Buyers have continued to wait on the sidelines for the real estate market to become more predictable, which has caused the Barrie condo market to continue to slow.
With the demand for condos in Barrie down and the supply at an all-time high, there is still room for the market to soften further as we move into the new year.
Some questions that come to mind are:
- Is this the bottom of the market?
- Now that interest rates have come down, will demand for real estate go up in 2025, putting upward pressure on prices on residential property in Barrie?
Since the peak of the condo market in Barrie in 2022, the average sale price for a condo apartment has fluctuated quite a bit, but as of last month, this sector is now only down by nine per cent.
The condo townhouse market, on the other hand, has been more active over the years, but in comparison is down 24 per cent from the peak of the market.
Last month, there were 24 condo apartments that sold in Barrie. The average sale price was $587,292 and it took an average of 54 days to sell.
Also, in October, there were 14 condo townhouses that sold with an average sale price of $516,036 and the average days on market was 37.
With the Canadian inflation rate now sitting at 1.6 per cent and interest rates coming down, it is good to see the economy becoming more stable as we close out 2024. This perceived stability could potentially boost consumer confidence to increase as the real estate market is starting to feel seemingly more predictable.
These are all positive signs of a healthy real estate market for 2025.
There are currently 221 condominiums for sale in Barrie — 160 condo apartments, 43 condo townhouses and 18 leasehold condominiums.
* All stats are based on listings sold with the Toronto Regional Real Estate Board
