Well… it’s been a great run for sellers. Over two years of unbelievable value increases, properties sold in a few days with no conditions and many multiple offers! Low mortgage rates, a lack of inventory plus a pandemic that gave buyers the need for more and better housing all combined to drive the market to new heights.
It was great for agents like us too, IF you were the listing agent. Sales were happening fast. Put a home on the market in the morning and by the afternoon ten showings were booked for that or the next day. It became so busy that many of us had to hold off offers in order to deal with all the activity and to create that “buzz”. Then is was just a matter of waiting for the offers and helping our sellers through the agreements and pick the best one for them.
It was not so much fun for our buyers. Viewing homes on short notice because if they didn’t, it would gone before they would even got a look. Making offers on multiple homes only to loose to other offers time and time again. And of course, offering well above the asking price just to have a shot at getting a home. It was frustrating and disheartening for all concerned.
How things have changed in a relatively short period of time! With higher interest rates, high cost of living and the pandemic mostly controlled, the real estate market has made a huge turn. Although not a total buyer’s market (it’s more balanced now), the days of “must put my offer in now” and offers well over asking price are for the most part gone. There is still a shortage of some types and styles of properties and we do see the occasional sale above asking price but these have become rare.
What is happening in the market today is that the value of a home has dropped considerably from what it was just a few months ago and the buyers are well aware of this. Now we are back to the way real estate was for many, many years. Set a realistic asking price, wait until the right buyer comes along and be prepared to negotiate. And, don’t expect firm offers. Financing and inspection conditions are the most common and we are seeing most offers with these and other conditions on a regular basis.
In summary, we are back to a more “normal” market. Sellers must go back to preparing their home properly for sale. Clean, repair and stage. Price appropriately and don’t panic if you have not sold in ten days. Thirty to sixty days was not unusual just a few short years ago. Stay informed on the market and adjust your expectations as it changes. We or your agent should be updating you on a regular basis.
For buyers, don’t get to cocky! Yes, the pendulum is swinging back the other way but there is still a shortage of good inventory. If you find a home that meets your needs, make the offer. You may not have to bid against other buyers and you may feel confident in putting in a conditional offer but don’t sit around a wait too long.
What our help with your real estate needs? email us at email@example.com
The real estate market in Ottawa and many other parts of the country, are in flux, changing, adapting and somewhat unpredictable. Average sale prices are high, number of homes sold are dropping and there is no quick fix in sight for the most important factor in these numbers; SUPPLY AND DEMAND!
Pure and simple. There are many more buyers than there are homes. This imbalance has been going on for about two years and for now is continuing. The only reason the number of homes sold and condos have dropped (down 12% for freehold and 10% for condos) is that there is not the supply.
This has all contributed to the rise in prices in March 2022 alone. 12.5% for freehold and 9.6% for condos as compared to prices in March of 2021. New rules regarding investment buying has so far done little to help but the rise in interest rates seems to be having an affect. We are seeing less offers on properties. Yes, there are some homes still attracting 10 or 15 offers but many more are now either just one offer or just two or three. Buyers are being more selective, taking more time and being more selective.
What does this mean for you? If you are a seller, it’s back to the days of making sure your home is ready to show. Think of it as if YOU were buying a used car. Would you buy the one that has just been waxed, had the interior totally cleaned and the engine tuned up or the one with mud splatter on the exterior, the brakes worn out and pet hair all over the seats? Well a house is a much larger investment so cleaning, fixing and shining your home is extremely important. We might have been able to get away with leaving a few things a little rough but not any more.
If your buying there is a little less pressure to jump on the first home that hits the market. Yes, the inventory is still too low but the number of qualified buyers has been reduced so there is a little less competition out there. But still be well prepared. Make sure to get you financial picture and mortgage qualifications all set up before going to see any homes. Know what type of closing date you want and need. Are you renting? How much notice do you have to give your landlord? What funds to you need for lawyer, mover, taxes and other expences over and above the purchase price?
In summary, we should follow that old Boy Scouts motto, Always be prepared!
While there are plenty of great resources available to help you narrow down what you’re looking for, and research the region or neighbourhood that may best suit your lifestyle, consider these benefits to hiring a real estate professional when buying your next home.
A REALTOR®1 will not only take the time to help you find the right property, but also assist you through the buying and closing process. By getting to know you they can make suggestions of similar properties in similar neighbourhoods that may be off your radar. They have their fingers on the pulse of communities across the region they cover. They will advise you through the offer process and once a bid is won, they can recommend trusted professionals to help you complete the transition.
Here are some benefits to consider:
ACCESS TO A LARGE NETWORK: A licensed real estate agent will have access to more available properties than the general public. Through their professional databases and relationships with other agents, a realtor knows what properties are coming on the market before they are posted, and may have other clients, or colleagues with clients, who are preparing to sell a home that fits your criteria. Some homes are sold prior to being listed and others are only publicly listed for a very short time. You could miss out on your perfect home.
NEGOTIATING: A realtor is a professional negotiator, and it is part of their job to get you the best possible deal on a property. They have insights into the local market, and with access to important data, they have a deep understanding of property values in a particular area at a given point in time.
NAVIGATING THE TRANSACTION: A real estate agent is an expert in their field, and having an experienced professional on your side will take the stress out of the critical paperwork that is necessary when purchasing a home. A realtor will guide you through one of the most significant and important transactions of your life.
ACCESS TO OTHER PROFESSIONALS: It’s always helpful to have referrals from friends and family when hiring a professional. Just as you may be referred to an agent, your agent can refer others to you. Real estate professionals have access to a large network of home inspectors, appraisers, contractors, financial advisors and mortgage brokers, and movers, to name a few. When you hire experienced experts, you get what you want the first time while saving time and money.
Want to know more about us and what we can do for you? You can email us at firstname.lastname@example.org and search through this website.
There’s that old carnival saying, “Round and Round she goes, were she stops, nobody knows”!
Well, that’s what the real estate market in Ottawa and many towns and cities across Canada is like. The number one question we get is “When will this end?”
The truth is nobody really knows. It could end when interest rates climb to a point that makes borrowing too expensive. One reason prices are getting so high is that it’s cheap to borrow money right now and lock that payment in for 5 or more years. We know of several people who were not selling or buying but re-financed their homes, payed a penalty for an early discharge of their present mortgage and still came out ahead because the new mortgage rate was so much lower than their existing rate.
Buyers have been able to get mortgage rates as low as 1.65%. They are creeping up a bit but even at 2 or 2.5% it is still very affordable to borrow money. And with COVID and the economy suffering because of it, interest rates should not jump too much higher.
There may be a time in the future that buyers start to push back against these high prices and tough multiple offer situations. We are seeing a bit of this right now as we right this blog. The stats from March are impressive. Number of transaction are up by 50% compared to last March. Average residential sale prices are up by 35% in the Ottawa area over last March and condo prices are up almost 18% March over March.
The number of offers on individual homes seems to be dropping. Less and less we are seeing 20 or more offers on a home but the majority of sales still involve multiple offers.
So, what do you do? If you’re buying and selling it’s not a huge issue except to find the right home to buy. Financially your home may be worth a lot more than it used to be but so is what you want to buy. If you’re a first time buyer, buckle up! For the reasonable future there will still be plenty of bidding wars, over asking price sales and not enough homes. Number one is get your financial picture in order. Speak to your lender about a pre-approval or call us and we’ll set you up with some of our great mortgage people.
Of course we will help you though every step and try to make the sale and or purchase as easy as we can.
Stay health and safe!
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It’s early February. COVID-19 is still present and accounted for with newer more contagious strains growing in numbers. Some areas are just starting to relax some of the strictest lockdown measures we have seen.
All of this and the Ottawa real estate market is booming. Both the rise in value and number of units have risen dramatically. The average house price in Ottawa is now over $677,197 up 31.2% over last January and units sold were up 21% over last January.
The stats are a little bit misleading as there was an unusual number of $1,000,000+ homes sold in January but even eliminating those home, the rise in value is still substantial.
Condos have not fared as well but have still had decent increases in value. These properties has increased a modest 12.8% to an average price of $380,366. However, the number of units sold has increased dramatically by 31.2% over last January. There has been lots of condos on the market which has kept the increase in value down but as the stats show, they are stating to get bought up and this can only lead to higher values.
We’re here to help with all your real estate needs so if you want to know what your home is worth simply write of call.