Condo market rapidly cooling off in St. John's area
It's been years of boom for the real estate market in St. John's, but things are rapidly cooling off for at least one big sector.
Condos have been steadily going up across St. John's and surrounding areas for years, but it looks like things are about to change.
"There's 229 active condo listings right now on the MLS system, and out of that we [have] about 130 or so [that] are actually new condo listings," he said.
Some new projects in the area are stalled, and sales of existing ones are slow to move off the market.
Janes said that translates to lower prices for people looking to buy a condo.
"Last year the average new condo price was down about eight per cent, so again a little bit because of that oversupply situation. And right now, the average existing condo price was down four per cent in 2013," he said.
'Nice, sweet spot'
It doesn't mean good news for developers, but some have made adjustments to keep their sales alive.
Charlie Oliver, the CEO of Martek Morgan Finch, said his experience of nearly 30 years in real estate has shown him this is just another change in the tides.
"We've brought the price down in our units by about five to seven per cent effectively, which has moved them just below $200,000 and we just closed one last week, and we're looking forward now to increased activity because that's a very nice, sweet spot for pricing," he said.
Oliver said there are enough empty condos on the market now to last another two years, but development will likely pick up again before then.
"We all know it takes, call it two years, from idea conception to moving somebody into a unit. So I would expect the construction of condos this year to slow down and probably see it come back to life next year," Oliver said.
He said things may not be moving as quickly as developers would like, but things are bound to change again before too long.