If you want to know what is really happening in today's real estate market, you might have to wait at least a month to read about it in the papers. The Real Estate Board will release last month's statistics, and then the Media will begin to interpret the information and write about it - sometimes without the proper analytical methods.
Based on the statistics that I have collected of the homes that have sold over the past 30 days in Mississauga, 60 percent of them sold within two weeks. 40 percent of all homes sold in 7 days or less. The remainder of homes that are on the market are often considered to be stale. They have been on the market for over two weeks and the probability of them selling is considerably lower. These homes make up around 60 per cent of today's inventory. What we can conclude from these statistics, and what we are experiencing as real estate professionals, is that the new homes that come onto the market disappear quickly. The homes that linger around longer have sellers that are testing the market, hoping that someone will buy their home for a higher price than is warranted in today's market.
We are seeing more activity. Reasonably priced properties in appropriate conditions are being sold quickly. Buyers are actively purchasing and we are anticipating even more activity and a stronger market. There are already many properties being sold in multiple offers once again. 27 per cent of homes sold, sold for 100 per cent of asking or above asking price. We may be in for a strong spring market.
A few years ago when we had a normal market, we would typically be in a seasonal transition stage at this time. The real estate market has typically been seasonal. It would be slow in the winter; spring would be the most active time of the year; summer would be calm as families are enjoying the sun, while others are packing and moving from their purchase in the spring; in the fall activity picks up as kids go back to school and parents go house hunting; and finally a few weeks before Christmas the market come to a slow pace. It has only been in the last few years that we have had a "spring market" all year long. A stronger spring market is anticipated, hopefully, we will go back to a healthier real estate cycle as we had experienced in the past as opposed to full-on bidding wars of the last few years.
I have found a few well-written articles well providing some additional insight in regards to what is happening in the market locally as well as in surrounding markets.
I recommend reading these two articles as they paint a good overall picture:
What’s Driving Housing Prices in Mississauga?
Here’s Exactly How Much it Costs to Buy a House Right Now in Mississauga
Here are some excerpts from other news articles:
“When TREB released its Outlook for 2018, the forecast anticipated a slow start to the year compared to the historically high sales count reported in the winter and early spring of 2017. Prospective home buyers are still coming to terms with the psychological impact of the Fair Housing Plan, and some have also had to reevaluate their plans due to the new OFSI-mandated mortgage stress test guidelines and generally higher borrowing costs,” said Mr. Syrianos.
“As we move further into the spring and summer months, growth in sales and selling prices is expected to pick up relative to last year. Expect stronger price growth to continue in the comparatively more affordable townhouse and condominium apartment segments. This being said, listings supply will likely remain below average in many neighbourhoods in the GTA, which, over the long-term, could further hamper affordability,” said Jason Mercer, TREB’s Director of Market Analysis.
Inventory slump has real estate markets in a slumber across Ontario
Ira Jelinek, an agent with Harvey Kalles Real Estate Ltd., is spending most of his time dealing with clients trying to buy. Detached houses, semi-detached houses and condo units are all selling in competition, he says. The roster of new properties is thin. When they do arrive on the market, they sell quickly.
"I'm frustrated dealing with multiple offers," he says. "The listings take care of themselves."
Mr. Jelinek recently represented some buyers who made an offer on a semi-detached house in the family-friendly Leaside area. The house had an asking price of $1.489-million and received five offers.
Mr. Jelinek's clients lost when another bidder placed an offer for $1.66-million – or $171,000 above asking – on the table. "We weren't willing to pay above ask. It was on the high end for a semi-detached."
He believes the scarcity of listings is pushing up prices and recommends that homeowners who are thinking about listing in the 416 area code do so now, despite the line-up of holidays in March.
"I would tell them now – I would get ahead of the rush," he says. "Chances are there wouldn't be a house like their's in the neighbourhood or on the street."
What are the Canadian housing markets to watch this month? Here’s what the experts are saying
“Notably, Ontario’s Greater Golden Horseshoe is one of the fastest growing regions in North America, expecting to grow 13.5 million people and 6.3 million jobs in the next 23 years,” reads the report.
Vancouver’s prices are headed skywards
Vancouver’s housing market is only getting hotter, with the benchmark price of a home rising 17 per cent year-over-year to $1,071,800 in February.
“The sales-to-new listings ratio, which is usually a pretty good gauge of tensions in the market shows that sellers continue to have the upper hand in setting prices,” RBC senior economist Robert Hogue told BuzzBuzzNews.
Hogue expects that the condo segment will do particularly well in the next few months, due to its relative affordability. He also adds that if interest rates continue to rise this year, Metro Vancouver’s housing affordability challenges “will become even more acute.”
We won't see a repeat of last year's real estate craziness, but it's still a seller's market
And like spring itself, there are certain signs that this season is shaping up to be a busy one.
"I hate to say it but it's almost like sellers' revenge."
- Robert DiLoreto
"The biggest sign is when you have so many buyers looking for houses," said Michelle Wright, a London realtor with Nu Vista Premiere Real Estate. "When I take a buyer to a house and there's a line up of agents with their clients trying to get in the house it makes it known it's a busy market"
Wright said she often encounters multiple offers on homes because there are so many buyers and so few sellers.
In fact, the number of homes for sale is well below the five-year average, according to data from the London St Thomas Association of realtors.
Last month, there were a mere 1,013 active listings on the Multiple Listings Service for London and St Thomas, which is 1.5 times below the five-year average for the month.
Robert DiLoreto, a London real estate broker with more than three decades in the business, said aside from Christmas, the market never really went into a winter slumber.
"It's been going on now since the first week, second week of January, continuing on from last year," DiLoreto said. "I consider it a supply and demand issue right, where the number of listings is really down, which is great for the sellers."
According to data from ReMax, 64 per cent of the homes sold in February had multiple offers and sold, on average $24,000 above asking price.
Ottawa could be heading into a seller's market
"Right now just about every agent in the city has somebody looking to buy, but we can't find what they're looking for because our inventories are low," said OREB president Ralph Shaw
"There is no doubt our sales numbers would have been much higher if we had more properties available for sale. This is creating a supply issue in the Ottawa real estate market," said Shaw.
"If this trend continues, the market will move to favour sellers, and buyers will find themselves competing for a limited number of listings."
Bidding wars and scant supply: Ottawa's housing market finds itself 'listings-starved'
Ottawa’s real-estate market is becoming so tight that many homeowners are refusing to put their properties up for sale until they can be assured they’ve got someplace else to go.
“I’ve been in real estate since 2004,” said Paul Rushforth, principal of the firm that bears his name, “and I’ve never seen such a listings-starved market.”
How starved? The Ottawa Real Estate Board reported Monday that there were just 3,028 residential properties for sale at the end of February, along with 1,064 condominiums. That was down 21 per cent and 26 per cent, respectively, from a year earlier. Board data draws upon sales made by more than 3,000 sales representatives and real estate brokers. It does not include purchases of brand new homes.
Rushforth estimates that roughly half of his firm’s sales are the product of bidding wars. He cites the recent example of a Barrhaven townhouse that received 30 offers before it finally sold at $33,000 over the $299,000 asking price.
Toronto Neighbourhoods Where House Prices Are Rising [INFOGRAPHIC]
But are house prices truly softening in the 416? While the aggregate data indicates a plunge, the reality is real estate price conditions are extremely local, especially in Canada’s largest city. In fact, recent month-over-month data indicates that, by all measures, the city is in for a robust spring market, with multi-offer and bidding war situations once again the norm.
“There’s a lot of excitement at the moment and the buyers are out,” said Lauren Haw, Zoocasa Realty’s Broker of Record, of the February data. “There are pockets of the GTA, especially certain neighbourhoods in Toronto, where we’re seeing fierce bidding wars – and other parts where conditions are more balanced.”