Two interesting opposing views of the market:
1) A local realtor makes an online post this past week about how her client lost out several times on properties they loved only to be caught up in multiple offers.
2) CMHC releases a report predicting values will drop by 9 to 18 per cent in 2020.
Real estate predictions are based on a combination of breaking down market statistics/trends and using intuition formed around experiences. Rather than get my crystal ball out (it is rarely accurate) let’s look at where we are at the end of May and compare the activity to a year ago. This will give us some valuable information on where the market might be heading.
In May 2019, Oshawa had 470 detached homes on the market for sale. At the end of last month, we had 203 homes for sale. This is a drop of 55 per cent. Sales for May 2019 were 204 and at the end of last month we sold a total of 166 a drop of 20 per cent. In the past when sellers are reluctant to place their homes on the market, and buyers are still active it causes values to increase and multiple offers to return. This lack of inventory has caused the average price for a detached home in Oshawa to increase from $567,100 at the end of April to $590,240 by the end of May. Sellers putting their plans off seem to be a trend as we saw fewer homes listed for sale in Oshawa last week than in the past three weeks.
To answer the question about our spring market starting in June, the trending, if continuing, indicates that June to August will be our spring market. Buyers buy out of necessity and opportunity. In a “typical” year, buyers are active February to May hoping to be settled by end of summer, in many cases, to have their children settled before school starts. That is the necessity part of the mix. The opportunity sales happen if buyers feel that by holding off, they may pay higher prices for their property or higher borrowing costs if mortgage rates increase. This speeds up the buying timeline for many concerned about losing out. The school year ending in March brought the market to a halt and ended a very active spring market. Pent up demand is heating up and week by week we seem to be entering into an overheated sellers market. Our economy appears to be opening up and I am seeing more and more people heading back to work. As things return to whatever normal looks like the buyers will restart their searches for a new home.
Sellers and buyers act when they feel a sense pf certainty in the real estate market. It is challenging to make decisions when you see media sharing “shocking” national stories such as the one above from CMHC. The best place for gathering info on your neighbourhood real estate market is over your kitchen table with a local agent, by reading local resources like The Oshawa Express or gazing into a crystal ball. I have never had luck with a crystal ball so best practices are local; realtors and The Oshawa Express.
These are uncertain times filled with many conflicting messaging and stories. If you have questions or see a real estate emergency on the horizon, I can be reached at firstname.lastname@example.org
Lindsay Smith Broker
Keller Williams Energy Brokerage