Real Estate

20% drop in new build price in one year

  • Last Updated:
  • Feb 10th, 2020 6:21 pm
[OP]
Sr. Member
Dec 19, 2010
574 posts
131 upvotes

20% drop in new build price in one year

I have been looking at new builds in Oakville and came across an interesting data point courtesy of the Way Back machine at archive.org. Check out the following:

Remington 45’ lot
Cornel model
5 bedroom Elevation B

Jan 2019 price: $1.87M
https://web.archive.org/web/20190104154 ... he-cornel/

Mar 2019 price: $1.67M
https://web.archive.org/web/20190307175 ... he-cornel/

Feb 2020 price: $1.49M (Now sold out)
https://www.remingtongroupinc.com/property/the-cornel/

That’s a whopping 20% price drop on this particular lot and model in one year!

Clearly new build prices are being recalibrated to below resale prices (same size home in resale in the preserve area in Oakville is listed around $1.65M+ and inventory is very low). 2020 seems to be a better time to buy a new build with prices much lower than paying 20% more as some buyers must’ve done just a year ago.
38 replies
Member
Jun 23, 2009
224 posts
224 upvotes
Hamilton
I have also been following the Oakville market and see new builds not selling and prices coming down over the last 6 to 8 months.
Deal Fanatic
Feb 29, 2008
9706 posts
4998 upvotes
Detached houses are not selling because most people can't afford them with the stress test. It's that simple. Not all builders are dropping their prices though.
Deal Expert
User avatar
Oct 26, 2003
32279 posts
3124 upvotes
Winnipeg
It certainly does not look like a 1.8M house to me.
Deal Fanatic
Oct 7, 2010
8933 posts
1170 upvotes
Not selling because its overpriced to begin with. Remember this is north oakville. It's in the middle of nowhere. North of you is already Milton. Is it worth 1.8mill for 3.6k sq ft? Of course not.
Jr. Member
Jul 2, 2018
188 posts
169 upvotes
GTA
The prices were out of wack to begin with. 3600 sq ft on a 46 ft lot versus Mattamy offering 5200 sq ft + on a 50 ft lot for cheaper on the same street.

Things were selling slower in that development, but in the last week a bunch of lots my clients were looking at disappeared, even the ones with 50-130k lot premiums. We had been looking for quite some time and weren't in a rush to buy and we showed up last week later with our cheques and our top 2 lot choices were both gone plus a bunch of others.
Realtor
Deal Fanatic
Feb 29, 2008
9706 posts
4998 upvotes
divx wrote: It certainly does not look like a 1.8M house to me.
There’s that too. Can’t pass off a basic house for that kind of money anymore. It’s not 2017
[OP]
Sr. Member
Dec 19, 2010
574 posts
131 upvotes
RealtorInvestor wrote: The prices were out of wack to begin with. 3600 sq ft on a 46 ft lot versus Mattamy offering 5200 sq ft + on a 50 ft lot for cheaper on the same street.
Interesting that you mentioned Mattamy. I went to their sales Centre over the weekend and the cheapest home is $1.59M (3000 sqft, not a great layout) along with a lot premium (50’ green space backing lots). Didn’t seem to be any lower priced than Remington. And they have models that go all the way up to nearly $2M + premiums for lot size/green space.

It appears Remington and Fernbrook have right sized prices more in line with the resale market but Mattamy is still charging a premium (odd as Mattamy is not as upscale in standard finishes or build quality as the other two).
Things were selling slower in that development, but in the last week a bunch of lots my clients were looking at disappeared, even the ones with 50-130k lot premiums. We had been looking for quite some time and weren't in a rush to buy and we showed up last week later with our cheques and our top 2 lot choices were both gone plus a bunch of others.
I think it’s a classic case of limited resale inventory in Oakville especially in the $1.4-1.7M range. Also resale prices have increased significantly from Nov/Dec which is expected I suppose prior to the spring buying season.
Member
Jan 15, 2013
224 posts
166 upvotes
As others have said, it was way overpriced to begin with. True a 20% drop but that is just to bring it down to true value. Preserve is a nice subdivision but the builders are just cramming in houses on the smallest possible lots. North Oakville is very different from most of the other parts of Oakville. It’s a good entry point if you want to live in a new house in Oakville but if people are willing to pay almost $2m for a Mattamy or Remington house (or any “builder” house for that matter), no idea why they wouldn’t move to other parts of Oakville where lots are bigger and houses are nicer. Granted you won’t get 5k sq ft but you will get a much nicer home and with high end finishes. Everyone has their preferences.
Last edited by zsj495 on Feb 6th, 2020 8:59 am, edited 1 time in total.
Penalty Box
Dec 25, 2015
530 posts
322 upvotes
Canada
Who can get approval for 1M+ mortgages is beyond me
Penalty Box
User avatar
Apr 21, 2004
51935 posts
16523 upvotes
Those who have higher income and decent savings?

Not everyone is on their first year on the job making minimum wage.

Beats paying $3k in rent but yeah I wouldn't be able to afford even a $1.3m property. Maybe in three years but one is enough for the time being.
Member
Jan 15, 2013
224 posts
166 upvotes
If you haven’t been to Oakville recently in particular North Oakville, there are a lot of families that are from different parts of the world that were most likely very well off and brought that money over
wolfs004 wrote: Who can get approval for 1M+ mortgages is beyond me
Jr. Member
Aug 21, 2017
130 posts
66 upvotes
Oakville detached market 1M+ seems to be pretty stable to me. I do see some towns and semis in the 70s and 80s raising their price tag but we'll see if they will sell.

The rental market in Oakville is pretty bad. With strict AirBnB rules, a 800k semi can only rent for 2500~3000. I'd be much better off investing in a downtown condo.
Deal Fanatic
Feb 9, 2009
8333 posts
5432 upvotes
yeah the people who move to oakville in 1.3 mil 3500 sq homes were living in hut villages in asia

come on guys lets use our brains... not every immigrant is poor... a lot come with big money selling homes in singapore, dubai, delhi, or beijing.

not all immigrants coming in with $5 in their pocket from berlin.
Deal Expert
User avatar
Oct 26, 2003
32279 posts
3124 upvotes
Winnipeg
Sanyo wrote: yeah the people who move to oakville in 1.3 mil 3500 sq homes were living in hut villages in asia

come on guys lets use our brains... not every immigrant is poor... a lot come with big money selling homes in singapore, dubai, delhi, or beijing.

not all immigrants coming in with $5 in their pocket from berlin.
Oakville is fairly far away from GTA, at that distance, might as well build more houses with all the available land.

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