Kitchener-Waterloo-Cambridge Opportunities

Updated: Oct 28



Konfidis is delighted to extend it’s research into another important region in Ontario for Single-Family Rental (SFR) investment properties. This tri-city is home to a population of more than 630,000 residents and is among Konfidis’ top target secondary cities.

The region comprises three major cities: Kitchener, Cambridge, and Waterloo - located only a 90-minute drive to the west of Toronto along the busy 401 corridor and transit connections along the Kitchener GO Train service.

It is a fast growing, being the 10th largest census metropolitan area in Canada, having added 145,000 of its population since 2002**.

Major employers in the region include the leading educational institutions of University of Waterloo, Wilfrid Laurier University and Conestoga College. It has a strong and diverse private sector, with employers such as Toyota Motor Manufacturing, Manulife Financial and Blackberry.

Its constituent cities rank highly among Konfidis’ secondary cities on a gross-yield basis. In a previous Konfidis Insights article 10 communities showing home sold price decline resistance: Have we hit the bottom?, we highlighted Kitchener-Waterloo among other communities showing price resistance.

Today we dig more deeply into the region’s opportunities.

Kitchener

The city’s price trends hide divergence among home sizes.

Detached homes found a high of $1.16 million at the end of February 2022, falling 31% to under $800k in late July in the Konfidis trailing 30-day average. It has since rebounded to $873k, an increase of 9%.

Source: Konfidis.com from actual MLS Listings and transactions. For detached homes only, on a 30-day trailing basis. MLS Board Average, Benchmarks sourced from KWAR/WRAR average home sold price for detached homes only in Kitchener-Waterloo and Waterloo Region.

The opportunity lies in the trend among the 3- and 4-bedroom detached homes, which have diverged since late summer 2022.

Source: Konfidis.com from actual MLS Listings and transactions. For detached homes only, on a 30-day trailing basis. MLS Board Average, Benchmarks sourced from KWAR/WRAR average home sold price for detached homes only in Kitchener-Waterloo and Waterloo Region.

As can be observed, 4-bedroom homes have shown a modest increase of 7%, while 3-bedroom homes declined, having fallen 31% since their peak.

Waterloo

This city has strong rental fundamentals.

This university community in the north of the region is showing evidence of a bottoming of prevailing prices having dropped of 30% from peak to a current Konfidis Trailing Average of $910k, with signs of price resistance among all detached homes.

Source: Konfidis.com from actual MLS Listings and transactions. For detached homes only, on a 30-day trailing basis. MLS Board Average, Benchmarks sourced from KWAR/WRAR average home sold price for detached homes only in Kitchener-Waterloo and Waterloo Region.

Waterloo’s opportunity is found it is strong rental performance and growth rate, 3-bedroom Whole homes show an increase of 13% since the start of 2022 where 4-bedroom units show an impressive 23% increase.

Source: Konfidis.com from MLS rental and public listings. For Whole-home rentals, on a 90-day trailing basis using list prices.

Cambridge

This community that straddles the 401-transportation corridor has shown substantial price declines since peaking like most Ontario communities in the first quarter of 2022.

Prevailing detached home prices have declined by 31% from a peak of $1.13 million in February 2022 and are currently at $783k using Konfidis’ Trailing Average.

Source: Konfidis.com from actual MLS Listings and transactions. For detached homes only, on a 30-day trailing basis. MLS Benchmark sourced from CAOR/WRAR for detached homes only in Cambridge.

As a buyer, this is a compelling region, with prevailing listings with Days on Market now more than 20-days - not a level seen since the onset of the COVID-19 pandemic in the spring of 2020.

Source: Konfidis.com from actual MLS Listings and transactions. For detached homes only, on a 30-day trailing basis.

Supporting this buying opportunity is the spread between the prevailing listing and sold prices, utilizing Konfidis’ Trailing Averages. This demonstrates that the market dynamics have shifted since early 2022 providing substantial bidding opportunity.

Source: Konfidis.com from actual MLS Listings and transactions. For detached homes only, on a 30-day trailing basis.

At Konfidis, we believe in a data-centric decision making approach. Enquiries about our research or our upcoming SFR opportunities can be directed to hello@konfidis.com.

**Statistics Canada. Table 17-10-0135-01  Population estimates, July 1, by census metropolitan area and census agglomeration, 2016 boundaries – growth 2002 to 2021.