Motivated buyers

Oh to be a real estate agent in Prince Edward County. Business is good. Really good. Some are reporting more sales in the last couple of months than in all of 2019. According to Treat Hull, of the brokerage firm Treat Hull and Associates, sales this year are already outpacing last year by 18 per cent, despite a months-long pandemic- induced slump. In July, sales nearly doubled those recorded in the same month in 2019.

It seems in the age of COVID, the attractiveness of urban life has dimmed considerably for folks squeezed into a wee condominium or townhouse. What was once a place to lay your head between a demanding job and prowling the many and varied adventures of the city now feels more like a shrinking holding cell.

With more folks being encouraged to work from home, suddenly the requirements of home have altered dramatically. Especially the “where.” Prince Edward County meets many criteria for those whose priorities have been changed by the virus.

Oodles of natural beauty. Space to stretch out. A couple of hours from the city. Good roads and an okay rail link. High-speed broadband (some places). Great food and cultural vitality. Of course, perhaps the most compelling proposition is that these folks can trade their condo on Queen’s Quay, for a home in the County, with a lawn, with perhaps some money to spare.

This value differential has driven demand for County homes for several years—but COVID has lit it on fire.

It is fantastic for real estate sales folks. And for those seeking to cash out of their life in the County. It is, however, a challenge for those of us who choose to remain. A challenge to community. A challenge of affordability. Worse, we seem to be sleepwalking toward the proverbial cliff.

The problem is this. We have a woefully inadequate supply of new homes. Not nearly enough are being built in Prince Edward County. We have been underbuilding—even relative to our regional peers of Belleville and Quinte West—for more than a decade. There is an aggregate load of reasons why this is, but much of it boils down to the fact that it is difficult and expensive to build in the County.

Some of it is cultural. We don’t like change. The more we see it, the less we like it.

Folks who have lived here their entire lives tend to bristle at the claims of those who have recently discovered the place. More recent arrivals harbour the notion that they purchased the idea of Prince Edward County along with their home. Both groups seek to crystallize what they see as perfection—or close to it. As the ideal. This thinking inevitably permeates Shire Hall and governing officials.

It is hard to blame them. There are many examples of residential growth gone wrong.

But it is just as wrong to believe that we can simply ignore the trend, and hope it goes away. Or wish that folks who have set their ambitions on the County will simply lose interest. We cannot close our eyes and plug our ears to the forces changing Prince Edward County. It is happening whether we choose to see it or not. Whether we like it or not.

We are rapidly becoming a community in which only the wealthy may live. Others are not permitted. And the pace of this transformation is accelerating.

Why? Because we aren’t creating enough supply to meet the demand. Not even close.

We bought our current home five years ago. A recent sale of my neighbour’s home suggests that our home’s market value has doubled in those five years. Ours is an ordinary house on an ordinary street. The trend has become ordinary in Prince Edward County. Further, there is nothing to suggest this it is slowing. Indeed, a more sensible bet is that the pace of price escalation will accelerate.

There are, roughly speaking, 13,000 homes in Prince Edward County. We add about 100 new homes each year—a few more in a good year, a few less in a bad. In the absence of new housing stock, buyers continue to bid up the value of the existing stock.

We all know examples. We know home prices are soaring. And we shake our heads in amazement. But do we understand what is happening? Do we know where this trend is taking us? Do we fully grasp that ignoring the problem is making it worse?

We are heading to a place where only speculators, commercial investors and the uber-rich will play. There is a vast market of folks in Toronto considering a change of view. They are armed with the accumulated equity from their Church Street condos. And they are eager—and motivated, as real estate agents say—to displace you.

We are at a crucial intersection. A handful of new homebuilding plans are coming into public view over the next weeks and months. We share values that must be protected and fought for for every day—affordability, a livable community, proud heritage, healthy environment, integrated neighourhoods etc. We must manage these carefully and diligently. But we ought not mindlessly obstruct. Nor can we ignore it and hope it goes away. The path we choose will have an outsized influence on the future of our community.

I understand readers may recoil at the notion that we might rally behind subdivisions of new homes as a remedy—as a means to preserve a semblance of affordability in our community. But it really is a simple equation. Home prices will only stabilize when supply begins to approach the demand of the folks who choose to live here.

We can ignore it, or we can manage it. Or pull up the bridges.

rick@wellingtontimes.ca

For Treat Hull’s full report or to sign up for his newsletter go to www.treathull.ca