By Lindsay Smith
One of the things about selling real estate locally for three decades is that year after year, in regular markets, the timing of when homes sell is predictable. Many of the clients I work with are making their last move, so a question I get asked on a pretty regular basis is: “What month is the best time to sell that will give me the highest selling price?”
In a regular market, the answer is not only simple, but the selling months rarely change year after year. I would respond: “Get your home on the market in late January. February, March, and April as they are the busiest selling months of the year.”
This makes perfect sense, given that when homes sell in these months the closing dates come in June, July, and August, right in time for kids to get settled prior to the school year beginning.
However, 2020 has been anything but a “regular market.” We started the year off with a brisk spring market. From January and February into mid-March we saw increases in values, multiple bids on homes and a shrinking inventory. Once the “stay at home” orders were put in place on March 17, our real estate market went into shock mode with activity coming to a dead stop overnight. This interrupted the natural curve of the spring market, with activity being challenged until the beginning of June. I did some research on a typical spring market (2015) and here we see one compared to spring 2020;
Spring 2020 Spring 2015
Sales Homes for Sale Sales Homes for Sale
January 182 216 143 161
February 295 228 175 193
March 314 297 275 230
April 152 300 323 248
As you can see, we had a robust market lasting until March. What this does not show is that most of the sales in March were prior to the emergency orders. In 2015, which represents a regular spring cycle, the home sales more than doubled from January to March steadily building month by month. April is commonly a super strong month, however in 2020, we sold fewer homes in April than we did in January.
To add to the confusion, in September, we sold a total of 411 homes. I have mentioned on many occasions that my crystal ball is not overly accurate, and with these springs it may be easier to predict the American election than to forecast what the next few months will look like in real estate.
This column was sparked by a conversation I had answering online inquiries on a townhome I recently sold in Brooklin. Some of the comments indicated that the buyers were waiting for the market to calm down, and the prices to drop. Others commented that the townhome was priced far above market value and one mentioned they sold in the spring and are renting, waiting for things to turn around. The townhome sold to the first buyer who toured the property and it sold for the highest price on record in Brooklin for a townhome.
Bizarre as it appears, the spring market is really happening in the fall in 2020.
Being in contact with people eager to understand the real estate market, I get asked constantly what my feelings are on how sales will play out for the next quarter. My current feelings are: if you are planning on selling a property that you own, we know the market is unbelievably strong. In Oshawa last week, 86 per cent of all homes sold for full price or over asking.
My response is that we know the market is amazingly brisk right now and that mortgage rates are at record lows. Holding off, as some of the commenters on my advertising expressed, may turn out to be a costly mistake. Prices in Oshawa have spiked dramatically since May. In fact, semi-detached homes in January sold on average for $426,500 and as of the end of October were averaging $553,000. Most people simply cannot outsave the market.
Will the market calm or drop in value? I have learned that we know what is happening today, and tomorrow is a mystery. As the spring has revealed. anything is possible.
However, if I polish up my crystal ball my intuition is telling me that at the end of spring 2021, the market will be much higher than it is today. Again, that is my intuition, we need to get through the second wave, a rocky stock market and the instability south of Lake Ontario.
If you have any questions about the above information, or if you see a real estate emergency on the horizon, I can be reached at email@example.com.