Today we are going to look at what is happening in our real estate market. Check back later for a video on this topic as well! So let’s just hop right into it.
For March, we saw 191 new listings come on the board and there were 173 sales. Finally we are seeing more listings than sales, but I think the new lockdown for April will affect the numbers again. I think lockdowns are causing sellers to hold off on listing their homes (hence why February was so hot), but buyers either cannot or will not wait, driving up prices. Now is typically the time when we see the most houses on the market. Total listings so far this year are down 3.07% but total sales are up 15.68%.
For prices, we saw a bit of drop in March from February, but remember I had a bit of a caveat about the prices in February because of the pent up demand from January’s lockdown, as well as some high prices sales that sold in the month. This month, we have a median price of $460,000 (compared to $470,000 in February). This is a little lower but honestly it could just be based on one or two sales. Year-to-date the median is $458,000 compared to $446,012 at the end of February, so overall I think prices are still going up. Average price is now at $500,998 which is again slightly lower than February, but I think it is because of those high sales. Comparing month to month is useful for some things, but let’s look at the big picture. The year over year numbers are still fantastic! Median and average sale prices are up 31.47% and 34.74% respectfully.
These small ups and downs happen all the time in the real estate industry, and I think we are going to continue to see it rise for the rest of the year at least. I will post a full post and video about the proposed changes to the stress test, and how it will affect the market, but the short answer is that it might have an effect, but if it does, it will be short term. In 2017, when the stress test first was introduced, it had relatively little effect on the market in Sarnia-Lambton because house prices were relatively low compared to other areas. What may happen is that we could see more competition for the lower half of the market, as those who were looking in the $400,000 range now will look in the $350,000 range, pushing those prices higher. Overall, I wouldn’t be worried about it because it seems unlikely to me that the small increase (proposed changes would bring stress test levels from 4.79% to 5.25%, or 2% over market rate whichever is higher. Honestly, if it does have an effect, that would be a good thing to bring some more balance to the market, but I highly doubt it will.
I will also write a blog and do a video about what has to happen for prices to decrease and you will find it here when it is ready.
Overall, the market is still red hot and I believe it will continue that way for the foreseeable future. Unless there are major changes to real interest rates, or people decide after COVID that they don’t want houses anymore and want to go spend their money on other things, we are going to continue to see increases in price, strong demand and lack of supply.
Thanks for reading and let me know if you have any questions or comments!