The average price of a home in Waterloo Region increased by 5.5 per cent in 2015, according to a survey released Wednesday by brokerage Royal LePage.
The survey found that the average price of a home in the region during the last quarter of 2015 was $341,799.
While condos were the cheapest of the three types of homes tracked by the survey, they saw the biggest price increases.
Condo prices increased by 6.9 per cent year over year, compared to 6.4 per cent for two-storey homes and 2.2 per cent for bungalows.
Nationally, Royal LePage found that the average house price in Canada increased by 6.5 per cent in 2015, hitting a new high of $500,688.
Two-storey homes were the biggest gainers nationally, adding 7.7 per cent to their value, while bungalow prices increased by 5.4 per cent and condo prices by 3.1 per cent.
In an interview with CTV News, Keith Church of Royal LePage Grand Valley Realty chalked the increase up to a “shortage of good listings” in the local market.
“When somebody puts their house up for sale, there are more buyers than there are sellers,” he said.
Another factor in the increases, Church said, is the continued climate of low interest rates.
“A first-time buyer, or any buyer for that matter, can afford more in a mortgage,” he said.
So why the discrepancy between the national market, where detached house prices are rising and condos seem to growing more slowly, and the local market, which is seeing the opposite sensation?
Tim Ingold, who works for Coldwell Banker Peter Benninger Realty, says many local first-time buyers are opting for condos, because detached homes are already being priced beyond what they can afford.
“The trend today is apartment living – condos, high-rise,” he said.
Church says that while sales of new condos are surging, the local resale condo market doesn’t quite seem to be keeping pace.
“They tend to be a little bit flat on the resale. You’re seeing people that are renting them out rather than selling them,” he said.
While high levels of rental units can be a warning sign for the market, Ingold said there doesn’t seem to be much cause for concern there yet.
“As long as we have renters to fill up those units, I don’t think we’re at risk,” he said.
Both Church and Ingold caution that the student-focused high-rises in Waterloo’s university district are a different sort of beast entirely – and so many of them have been built in recent years that student rents have actually been pushed downward.