London area home sales fell 15.9 per cent in September from August because of a shortage of homes to sell, and that shortage of inventory helped push up prices by 20 per cent from a year ago, the head of the London St. Thomas Association of Realtors (LSTAR) said.
Falling inventory hurts home sales, pushes up prices
In September, LSTAR reported 776 homes changed hands in London and St. Thomas, compared to a near-record August, when 923 homes were sold.
By the numbers
- Homes sold in September: 776 (a drop of 6.1 per cent from September 2017)
- Homes sold in August: 923
- Average price of a home in September: $386,520
- Active listings: 1,640 (lowest September inventory level in 10 years)
“Last month, there were 1,640 active listings in LSTAR’s jurisdiction, marking the lowest level of September inventory in the past 10 years,” said Jeff Nethercott, president of LSTAR.
However, September sales numbers are still above the 10-year average.
“We’re not overly concerned with the drop in sales between August and September,” Nethercott said.
The 776 homes sold in September represent a 6.1 per cent drop over September 2017.
“What we did experience was a large increase in the average price for resale activity,” Nethercott said in the LSTAR statement accompanying the September results. “In September, the average sales price was $386,520, up 21 per cent compared to a year ago, and up 57.9 per cent compared to just five years ago
Nethercott predicted the price of homes will continue to rise as long as the Forest City remains in a seller’s market, a condition that has existed for about three years this fall.
September was the second time in the last decade when the East London sales average rove above $300,000. Homes in East London sold for an average of $302,452, up 10 per cent from last September.
August was the first month the average home price in London rose above one major Canadian centre, Edmonton, where the average price was $370,349 compared to London’s $387,099. August is the most recent month for which there are cross-country comparison numbers.