Seeing as I didn't do an update in July, I wanted to jump on and give you a brief update of what the market is doing. So in July we saw 47.4% decline in sales compared to the same month in 2021 and prices were 1.2% higher than the same time a year earlier. The gains of the past year were wiped out with the the 3 Bank of Canada rate hikes. So we are basically back to summer of 2021 prices. Not necessarily a bad thing unless you bought in February of 2022.
August saw very little change from July. Av Sale Price for August was $1,079,500 vs. $1,074,754 in July. What is changing is the mindset. Earlier this year, Sellers were buying first and getting multiple offers on their properties when they went to list. This is not happening anymore unless the property is listed well below market value.
The plus side to this now is that Sellers are listing first without the pressure of having bought firm in multiple offers. They are now selling and then going shopping for their next home. Pickering in the month of August only had 45 detached home sale, Ajax had 71, Whitby had 98, Oshawa had 161 and Clarington had 112. So homes are selling and obviously by the looks of this the further east you travel, the more sales. Most of this has to do with affordability. Pickering is more expensive to purchase in than Oshawa. Hence, those who cannot afford Pickering prices, will travel further east to purchase.
The biggest concern moving forward is another interest rate hike coming September 7th. It is projected to be another .75 bps. to 1%. This will impact many buyers purchasing power if they are in need of financing. If you are looking and haven't locked in a rate, I suggest you do so. It may save you a few hundred dollars a month in payments.
I truly believe that the higher borrowing costs have impacted many purchasers decisions and they are waiting on the sidelines. No one wants to catch a falling knife. So to give you an example of average prices and what has happened since February 2022:
We are seeing it stabilize a bit now - but after this week, we will probably see another price correction. But if you are buying and selling, it is a bit of a wash. You are selling lower and buying lower as well. If have an existing mortgage on your property, find out what the penalities are should you sell (if any) or if you can port the mortgage to your new property.
The average days on market is 34 right now and for many buyers, we are getting home inspections in our offers as well as conditions on financing (which was unheard of 5 months ago)... so all is not bad. :)
If you would like to see the full Market Watch for August 2022 - https://www.slideshare.net/MichelleMakos/august-market-watch-2022
To read more about what is expected from Bank of Canada next week - https://www.reuters.com/article/canada-cenbank-idCAKBN2Q23SM
I am sure everyone is excited this is the last official weekend of summer and all the kids are going back to school ... it's an exciting time for everyone. I just wanted to wish you all a wonderful September and to keep me in mind if you have any real estate questions or needs. I am always a phone/text or email away - 416-300-3004