London Market Report
2024 First Quarter Update
London prices start 2024 up 2% year-over-year; inventory fell sharply heading into spring market but still featuring more supply and longer selling times when compared to one year ago
Over the last two years, the Greater London Area, like other real estate markets across the country, saw a significant decline in sales activity. Resale units sold in 2022 was down 29% when compared to the record year in 2021 before falling another 13% in 2023. However, during the first quarter of 2024, activity picked up with inventory falling as buyers begin to return to market in anticipation of rate cuts. The Canadian Real Estate Association (CREA), through its various real estate boards and provincial associations, compiles transaction data for each of its major markets, with the CREA Stats Centre reporting sales data going as far back as 1980. While historical stats should never be the sole indicator of what’s to come, they are helpful to review and consider as part of the broader context. In this article, we'll outline latest transaction highlights for each of the communities comprising the London Area as well as overall performance by property type.
Greater London Area: Regional Overview
London, the seat of Middlesex County, is the largest city in southwestern Ontario and the 11th largest metropolitan area in Canada. With close proximity to the GTA, Michigan and New York state borders, and multiple Great Lakes, the region is well-poised for future growth. It is the economic hub of southwestern Ontario, with major companies, hospitals, and higher education based in the city. For anyone familiar with London, the signs of new housing development are everywhere, with significant urban sprawl occurring throughout north and west London.
30 minutes south of London is St. Thomas, the seat of Elgin County. Ten minutes beyond St. Thomas, Port Stanley and other beach towns along Lake Erie offer recreational getaways for London locals. A similar drive west of the city are the towns of Komoka-Kilworth and Strathroy-Caradoc, with a short drive further to reach the shores of Lake Huron. East of London, in Oxford County, are the growing towns of Woodstock, Ingersoll, Tillsonburg, and Norwich. With both the 401 and 402 highways running along the southern border of London, surrounding Middlesex County and these neighbouring communities are easily accessible. For this reason, they can be considered part of the Greater London Area.
Greater London Area: Total Market Overview
Across all communities included in the GLA, the median sale price to start the year was around $600K, up slightly from the prior quarter as well as year-over-year. A quick note on median versus average values. Median sale price, which reports the sale price of the middle-priced property in a group, is a more reliable metric than average sale price because it removes outlier transactions (i.e. properties that have sold for either a lot of money or have sold for next to nothing). Outlier transactions skew the average from what it really should be, which is the price of the average, or mid-priced home, in a particular community. The same concept extends to selling times, with London's average days on market currently at 37 days while the median listing is selling around 22 days to start 2024.
Despite minimal price growth over the past two years, London prices have experienced significant growth since 2018, outperforming neighbouring markets like Kitchener-Waterloo, Hamilton, and the GTA. This can be widely attributed to the relative affordability of London homes when compared to similar ones in these nearby markets. For the preceding 20 years, London prices have more or less lagged behind the growth experienced in these markets, and it appears that recently the Forest City has been playing a bit of catch-up. Compared to the average price recorded in Q1-2019, London homes are now up 60%, which represents an annual growth rate of 9.8%. To compare London’s performance against other major markets in the province, check out our article on Top Markets in Ontario here.
Part of what drove London’s phenomenal price growth during the pandemic was its shortage of housing supply available for buyers. To end the 2021 year, the Greater London Area had only 0.4 months of inventory, meaning that listed homes were selling in under two weeks on average. Without new homes hitting the market, London inventory would have disappeared in less than a month. When inventory levels are this low, prices have to rise on account of too many buyers bidding on too few properties. This leads to bidding wars and runaway prices which were consistent themes during the market peak in early 2022. Over the trailing 5 years, the GLA has been a tight sellers’ market, with an average of only one and a half months of resale inventory.
Beginning in March 2022 and extending into 2023, multiple interest rate hikes resulted in a market slowdown, with London ending the year with 4.4 months of available inventory, more than double the historical supply recorded since 2018. However, after an active start to the year, inventory levels fell to balanced levels at around 3 months. Homes are also selling slightly faster at 22 days, down from 25 days to end 2023. With many buyers re-entering the market on anticipation of rate cuts, inventory and selling times should continue to fall during the upcoming spring market.
Most properties in the Greater London Area, about 3 out of 4, are detached homes. Detached homes in London, as expected, are more expensive than apartments and semi-detached properties, with median sale prices to end the year of $650K and $475K respectively. Over the past 5 years, detached homes in London have seen prices grow at a slightly slower pace than the apartment segment, which has nearly doubled in value since the first quarter of 2019. To end the year and continuing through the first quarter, both property types are taking around three weeks to sell with similar inventory levels.
Community Overview
London North, London South, and London East
You’re probably wondering why London West is missing from the title. I certainly was when I began reviewing data reported by the London and St. Thomas board to CREA. It is not a typo or omission. The local real estate board has actually just divided London into three main regions, large in part due to the Thames River that winds its way through the city and forks near the downtown core. London East is bounded by the Thames River to the north, south, and to the west, where the river runs through Western University and alongside Richmond Street, the main thoroughfare to downtown London. London South, similarly, is the portion of the city that is south of the Thames River and its downtown fork. Finally, there is London North, which is bounded to the south and east by the fork of the Thames. These three boroughs each have multiple neighbourhoods within them, and in total account for close to 60% of resale activity in Greater London.
Despite inventory and selling times falling to start the year, London proper is still featuring more balanced conditions than one year prior, with both inventory and selling times up year-over-year across all three boroughs.
Despite similar trends for inventory and median days on market, London proper features drastically different house prices across the city. London North leads the way, with a median sale price to end the year of $680K, up slightly to start the year. This area is characterized by high-growth, newer developments such as those in Masonville and Sunningdale as well as the big-box retail and new homes surrounding Fanshawe & Hyde Park. London East, historically and to this day, is the most affordable of the three boroughs, starting the year with a median sale price of $486K. This area has the most diverse housing mix in the city, which includes historic luxury properties along the Thames River downtown, an array of apartments and multi-units in the downtown core, and smaller, more affordable detached homes east of Adelaide Street. Given this wide-variety, it’s important to speak with a realtor knowledgeable in your preferred location and property type in order to get a better sense of what – and where – you may be able to afford. Of the three boroughs, London East continues to report the largest year-over-year price increase at 4.7%. Finally, London South ended the year with a median sale price of $596K, up slightly year-over-year as well as from the prior quarter. Prominent neighbourhoods in South London include Wortley Village, Byron and Springbank Park, and White Oaks.
Community Overview
St. Thomas and Elgin County
St. Thomas and surrounding Elgin County is a short drive south of London. Its population of 50K is mostly based in St. Thomas, with just under 10K residents based in surrounding rural areas alongside the small townships of Central Elgin, West Elgin, Dutton-Dunwich, Southwold, Aylmer, Bayham, and Malahide. In terms of overall resale units sold, it is fourth largest GLA region after London South, North, and East. While sales activity is still down from historical levels, it remains a more active market than London, with sales of the last 12 months only down 17% when compared to the trailing 5-year average.
To start the year, St. Thomas and Elgin County reported a median sale price of $575K, gaining on the prior quarter but still down slightly year-over-year. After inventory steadily grew in 2023 to end the year with over 5 months, resale supply tightened during the first quarter. When compared to the trailing 5-year average, buyers still have close to twice the homes to choose from.
As expected from increased relative supply, homes in St. Thomas and Elgin County are taking a long time to sell, with a median listing period of 33 days, up from the prior quarter and on pace with selling times observed one year ago.
Community Overview
Woodstock-Ingersoll
The next largest region within Greater London is Woodstock-Ingersoll, more or less similar in population and unit sales to St. Thomas and Elgin County. Beyond the primary towns of Woodstock and Ingersoll, which are home to just over 50K people, the neighbouring communities of East Zorra Tavistock, Blandford Blenheim, and Zorra form the remainder of this region. It is a unique smaller market, with direct access via the 401 to larger cities such as London to the west and the tri-cities and Brantford to the east.
To start 2024, Woodstock-Ingersoll recorded a median sale price of $607K, flat from the prior quarter and on a year-over-year basis. When compared to its trailing 5-year average, the median price is up 10%, performing in line with the entire GLA.
At the start of 2022, inventory levels in Woodstock were critically low, with only about half a month of inventory. This supply-demand imbalance is why prices in Woodstock-Ingersoll were up 30% in 2021. In 2023, as seen across most regions in Ontario, Woodstock-Ingersoll saw inventory levels grow in the third and fourth quarters, ending the year with close to 5 months of available supply. Inventory fell 2 months to start the year, now at 2.8 months and in line with supply levels from a year prior. Homes are also selling slightly faster to start the year, now at 24 median days compared to 27 at year-end 2023.
Community Overview
Tillsonburg & Area
Just south of Woodstock-Ingersoll and the 401 highway are the towns of Tillsonburg, Norwich, and surrounding counties of Southwest Oxford and Norfolk. The largest town of this area, Tillsonburg, has a population of just under 20K and is less than an hour drive from London and Brantford. The town has experienced strong growth in recent years, with the 2021 census recording population growth of 18% since 2016, significantly outpacing the overall province (5%) and London (10%).
Tillsonburg & Area started the year with a median sale price of $594K, down 4% from the prior quarter and 6% year-over-year. In 2022, inventory increased more than ten-fold, ending the year at 8 months, the highest level for all regions within Greater London. As expected in conjunction with this increased supply, homes were also taking much longer to sell, leading all GLA regions at 38 days. At year-end, just over 6 months of inventory was recorded, with homes still taking over 30 days to sell on average. Inventory fell to 4 months of supply to start the year, although homes are still taking over a month to sell.
A final note regarding Tillsonburg & Area is that prices are drastically more expensive in the surrounding rural communities when compared to the town of Tillsonburg, which can result in large swings in prices based on what type of properties sell during a specific time period. As always, speak with a realtor experienced in your preferred location to get more refined estimates on how a specific neighbourhood may be shifting.
Community Overview
Surrounding Middlesex County
Surrounding Middlesex County is comprised of multiple small townships that border the west, north, and east boundaries of the city of London. In terms of overall sales activity, the largest township is Middlesex Centre, which borders London to the west and north and includes the fast-growing communities of Komoka-Kilworth, Ilderton, and Arva. To the east of London is Thames Centre, which is centered by the town of Dorchester. Other townships comprising Surrounding Middlesex County include Lucan-Biddulph, directly north of London beyond Middlesex Centre, and Adelaide-Metcalfe and North Middlesex to the north-west.
Surrounding Middlesex County, while only 5% of current resale activity, remains the most expensive market in Greater London, ending the first quarter with a median sale price of $74 0K. New housing development is rapidly progressing in many townships within this region, with most projects focused on single-family detached subdivisions with premium price points. Median prices are flat from the previous quarter as well as year-over-year, driven from the highest inventory levels across the London area. At year-end 2022, inventory stood at 6 months, declined to 3 months by the second quarter of 2023 before drastically increasing to finish the year at over 10 months of inventory. To start 2024, inventory is now just under 7 months with median selling times down sharply from 38 days at year-end to 25 days in the first quarter.
Community Overview
Strathroy-Caradoc
Rounding out our list with just over 300 resales over the last twelve months is the municipality of Strathroy-Caradoc. Similar to Tillsonburg, the municipality has a population of around 20K and has experienced double-digit growth since 2016. Strathroy is less than 45 minutes from Sarnia, the shores of Lake Huron and surrounding Lambton County, and downtown London. It is even a closer drive to the high-growth towns of Komoka-Kilworth and Ilderton in surrounding Middlesex County. Strathroy, like Komoka and Ilderton, are experiencing a lot of new housing development to accommodate its growing population.
Strathroy recorded a median sale price of $622K in the first quarter, down slightly from the prior quarter but up 10% year-over-year. When compared to the trailing 5-years, Strathroy continues to lead all London regions for price growth, up 14.5%. Strathroy has experienced more stable inventory levels than other GLA regions, ending 2022 with 5 months of inventory, falling to 2.7 months through the second quarter of 2023, and now back up to over 6 months. However, inventory fell the most of all London regions to start 2024, with supply declining by 4 months to now sit at 2.5 months of supply. With homes also selling 13 days faster, Strathroy buyers appear to be flooding back in advance of the spring market.
Archived Reports
London & Area Market Updates
Third Quarter 2023 Market Report
Second Quarter 2023 Market Report
Summary
The Greater London Market report will be updated on a quarterly basis. Every market is different, but understanding available inventory levels alongside recent price and market trends can help prospective buyers and sellers make more informed decisions. You can subscribe to quarterly updates of the London Market Report report by completing the contact form below.
Thank you for taking the time to read this article. As you contemplate the next steps in your real estate journey, there are a variety of helpful online resources you can leverage, such as realtor.ca, the Canadian Mortgage and Housing Corp, and historical sales data and market insights from leading real estate websites like Zolo, Royal LePage, HouseSigma, and Wahi.
