The monthly stats are now in! Wow, what a month we had in July. The market has gone crazy with loads of people coming out to buy houses as things calm down a little bit from COVID. Things are for sure not back to normal yet, and they shouldn’t be treated as such, but as things get closer to normal and cases dwindle we are seeing a huge surge of buyers who are ready to move. I am not sure if it is just pent up demand, or if people have become sick of their homes from being stuck inside all the time, but either way if you are looking to sell, now is a good time to cash in on the market.
As released today from the Sarnia-Lambton Real Estate Board, the average price is way up! For the month of July, the average sale price was $414,453. That is an increase of 16.06% over last July. Year to date the total number of sales is down from last year by 6.34%, which I am pretty surprised by due to the fact that total sales dropped significantly during the latter half of March and through April. It seems like the buyers have all come back, leading to 189 sales in July 2020 compared to 166 in July 2019.
So now that we know that total sales are up, why does the price continue to grow at such a rapid pace? The answer, as usual for the past few years, is lack of inventory. We have so few listings coming on the market that they are almost all selling. It used to be common to have a house sit on the market for a couple months to find the right buyer for it. With a lack of listings (193 in July 2020 compared to 217 last year), and increased demand (189 sales compared to 166 in July 2019), it is easy to see that the competition to buy houses is causing people to increase the amount they are willing to spend. With roughly one month of inventory on the market right now, there simply are not enough houses to keep up with the demand. A balanced market is typically 2-3 months of inventory at any given time.
Overall, we are seeing a really good year for house appreciation. If you are looking to sell, now is definitely a seller’s market. The amount of houses we are seeing that get multiple offers is on the rise, pushing values up even more. With low mortgage rates, money is very cheap to borrow right now and when you look at your total return on investment (provided prices continue in this direction, which I think they will), it is also a good time to buy in before prices rise even more.
If you have any questions, feel free to contact me. Hope you all are well and are staying safe!
-David Bratanek