What has happened in the world of Real Estate since 2020?
The pandemic hit in full force in March 2020. What did that mean for homeowners and buyers?
- People were reluctant to give up their detached homes and green space during a global pandemic.
- Many people were able to work from home and no longer needed to be near their work. Buyers were looking for more space and affordable communities such as Hamilton.
- This resulted in low inventory coupled with high demand as people were opting to move. pastures.
- With high demand, low-interest rates (1.75 % to 1.25 % bank of Canada rate) and low inventory, prices began to climb.
- After March of 2020, home prices skyrocketed.
Does this trend continue in 2021?
- Inventory continued to be low when compared to 2019 and earlier.
- Selling prices of homes were at a high and setting records.
- The seemingly low inventory was in part because of a high number of sales relatives to the inventory. Buyers continue to pay record-high prices.
At the Beginning of 2022
- Continues to be record high purchases prices
- Multiple competing offers continue to be the name of the game.
- Interest rates continue to be low.
March 2022
- The first interest rate increase was in March; 25 basis points and 50 basis points in April.
- The prime rate increased to 3.2%
- The number of homes sold and the average selling price declined from the previous months.
End of April 2022
- In Hamilton, inventory is climbing.
- We are seeing fewer buyers coming for offer night and homes not selling after offer night.
- In the past few years pricing homes artificially to create multiple offers has created big win falls for sellers. This strategy is beginning to fail.
- Homes are being relisted at higher prices to reflect the sellers’ expectations. Unfortunately, the seller’s expectations created in the past few years may not be in line with the current buyers’ expectations.
- Inventory is beginning to climb and buyers are willing to wait.
- The predicted increase in interest rates may be causing buyers to pause and rethink their purchasing power.
- We may be seeing a shift towards more traditional offers.
May 2022
- The housing market has cooled leaving buyers and sellers confused about what to price their homes at and what to offer.
- Looks like Buyers may begin to have the upper hand.
- Buyers are waiting to see what will happen with interest rates.
Can I still sell my home in this market and get a fair price?
Yes! Pricing your home correctly is the key to success!
Price your home too high and it will sit on the market. We have seen that houses that are priced too high get little to no attention. Overpricing your home narrows the number of people who will want to view it. Once the prices were adjusted, the property sells. Right now, an overinflated sale price is not realistic. A sale at a fair price is better than no sale at all.
We have also seen current sellers price their houses artificially low in the hopes to create a bidding war reminiscent of the beginning of the year. The result was that they had offers but none that were in line with their unrealistic expectations set by the recent selling frenzy. Both buyers and sellers leave this scenario frustrated.
Overpricing your home also excludes Buyers’ who are using a price range as their criteria to search for their home purchase. Homeowners who are overpricing their homes exclude potential buyers that could actually afford their home had their home been priced correctly.
How do I price my home correctly?
We have seen that even in this changing market, a home properly presented and correctly priced will sell. The best strategy is always to have your home priced correctly and to use a strategy that aligns with current market trends and conditions.
Check out our next blog, Tips On How To Price Your Home to Sell. You can also reach out to us. We are here to help with all of your questions.