Shifting consumer behaviours in the face of COVID-19, coupled with historically low-interest rates resulted in a record-breaking year for real estate in Canada. Subsequently, buyers seeking more space have been relocating to provincial regions outside of densely populated cities, further contributing to ongoing urban sprawl.
As a result, Barrie has turned into one of the most "sought-after" real estate markets in Ontario, appealing to both families and investors, according to RE/MAX.
Located 45-minutes north of the Greater Toronto Area, Barrie offers homes at half the price than what you'd find in the GTA -- where the average home price is $932,222 -- and continues to be a hot move-over market.
And what was once a buyers' market has since become a sellers' market, thanks to Barrie's “strong growth” in sales activity and home valuations.
Indeed, real estate activity in Barrie has been hot, with sales up 51.5% in December compared to the same time in 2019, after 344 units traded hands. On an annual basis, home sales totalled 5,718 units in 2020, rising 23.6% year-over-year.
According to the Barrie & District Association of REALTORS Inc. (BDAR), the composite benchmark price rose 23.3% to $613,200 in December compared to the same time in 2019, with all property types seeing incredible growth at an annualized rate.
During this period, single-family homes saw prices rise to $644,000 (24%), while townhouses saw prices increase to $440,600 (28.8%), and apartments recorded an 11.3% price increase to $372,800. Overall, the average price of homes that exchanged hands in December soared 34.7% year-over-year, to $744,835.
The December figures also show that there were only 276 new residential listings in December, up 39.4 % from the same time a year ago. Meanwhile, active residential listings dropped 65.6% from December 2019 to December 2020.
Moreover, DBAR figures show months of inventory fell to 0.6 at the end of December, down from 2.8 months at the same time in 2019. RE/MAX says this is an important metric because it shows the number of months it would take to sell today’s stocks at the current rate of activity.
This raises the question: does Barrie serve as a better option for families, or for those looking to invest?
While the city is a great option for those looking to relocate from the big city, particularly first-time homebuyers seeking townhomes in the $490,000-$550,000 price range, Barrie also has other factors working in its favour to suggest the city could a prime market for investors.
"I think what attracts first-time buyers to our area is the same reason people end up staying here for the long term," Jeff Hoyles, a sales representative with Peggy Hill Real Estate told Toronto Storeys.
"We offer reasonable pricing, access to major shopping and healthcare facilities but are still a close commute to the GTA with an abundance of outdoor activities nearby. We've been able to keep the small-town feel even with all the growth we've seen in recent years. I believe people feel this when they visit our area. It's hard to beat our prices, being able to be out on the water in the summer, hit the ski hills in the winter and everything just a short drive from home."
Hoyles noted that while the market has been changing over the last few years, 2020 saw record highs in terms of the number of homes sold, with first-time buyers making up a large portion of this increase.
"More than half of the buyer clients I work with are moving north, the majority of them being from the Golden Horseshoe. I think we're on people's radar, they recognize that for the same money you might spend in Toronto on a townhouse, you can head slightly north into Barrie and to get into a large detached home with a nice yard," said Hoyles.
As for investors, Hoyles says they are attracted to the area due to the high rents that are charged but again with lower price points.
"This results in a property being able to potentially cash flow more effectively and result in higher ROI for the investor. Rents are up almost 5% in 2020 in Barrie, while vacancies are extremely low, resulting in a significant increase in demand for rental properties here."
Whether you're exploring housing options outside of the city, or you're looking for an investment property, Barrie real estate is forecast to jump 4% to an average price of $569,525 across all property types in 2021.
And as households continue to shift their buying behaviours, coupled with tightening housing inventories and strengthening demand, we can expect Barrie's real estate market will remain hot through 2021 and beyond.