NOT BUSINESS AS USUAL
We’re starting today’s blog at the end today — with the numbers.
The week in review:
As expected, sales have dropped off dramatically, with a ninety percent reduction in sales this past week versus the same week last year.
I’ll let that sink in for a moment.
Normally in this paragraph I’d talk about the median home sold, but with six sales the resulting stats don’t carry a lot of significance. The reduction in activity is the first of what I expect to be a number of dramatic changes that will appear over the next few weeks.
The median sales price for a Guelph home has dropped 2.75% from the end of February to the end of March. The bulk of that drop occurred in the last week of March, just as we were on track to set a new record for sales numbers and prices in March. That is until the Guelph real estate market came down with the virus.
Interestingly enough we looked at the weekly sales within the region. The Waterloo sales numbers were the same as Guelph, with 6 properties sold. Cambridge and Kitchener both reported weekly sales of 25 and 27 — significantly reduced from 2019, but still not as severe as in Guelph and Waterloo. A total of 74 properties sold in the region during a time where I would have expected that much production from the Guelph market alone.
The real estate market is in crisis, no doubt about it. The majority of Realtors, and many homeowners for that matter, have never experienced a market in crisis like this before.
In the almost 35 years I’ve been in organized real estate, I’ve witnessed and experienced a few markets like what we are starting to see. Each one of these experiences has molded me in some way. I’ve come out of these events a little stronger, tougher and hopefully smarter.
When I entered this business in the late 1980’s, mortgage rates were running between 13-18% — yes, credit card rates — and people were turning up at the bank and handing in the keys (much like the US market meltdown in 2008). Times were tough trying to sell a home where the owner owed more than the house was worth. Buyers were non-existent and the banks really weren’t interested in lending money to help.
Fast forward to 2001 and the events in September that rocked the world and set our economy on its butt again. We were lucky in Guelph to escape 2008 with little more than a 6 month blip.
The Guelph housing market has seen its share of crisis, and each time it's like a bad horror movie where nobody knows how or when it will end.
Each of these crises has had a profound impact on the market and our community, and each speaks loudly about the people that make up this business.
There are the heroes and vultures. There are some who rise to the occasion and show their best side. In tough times, the best of us reach out, support each other and act with empathy.
The Vultures also make an appearance. Looking at the crisis as an opportunity for self gain and aggrandizement. That’s part of the dichotomy of humanity.
We’ve seen plenty of examples of both over the past five weeks, both inside and outside the real estate industry. We’ve seen the outreach to seniors and the less fortunate, the neighbours checking in on each other, and the support to our front line workers, often under appreciated. Local companies like Dixon’s and Linamar re-tooling to fill gaps in critical supplies. I’ve watched Realtors step up to help clients and neighbours ensure they have food and supplies to self isolate with.
The vultures have been there as well. Some take advantage of supplies to drive prices up, others take to social media to be critical of others while singing their own praises. The “opportunists” looking for distressed properties. The Realtors looking to show properties without taking proper precautions or using alarming marketing materials to scare people into dealing with them.
There are going to be plenty of lessons to be learned from the 2020 pandemic.
I know that as a brokerage and as an individual, we’re already looking at what we’ve learned during this pause. We’re looking at what we want to carry forward into our post-pandemic life and what we plan on leaving behind.
Moving forward, I know that personally I want to spend more time with people that really matter to me and help lift me up. I’m looking forward to a simpler lifestyle with fewer distractions and more meaningful relationships. A pipe-dream? Perhaps, but one I’m willing to spend considerable time to develop.
Our brokerage and industry will see some significant changes. We were already virtually a paperless office and had embraced technologies to help facilitate the purchase and sale of homes. Post-pandemic, our investments in technology and more importantly in training and education will endure and pay dividends, as many Realtors and brokerages will go back to business as usual.
A few weeks ago we introduced a weekly webinar/podcast that we’ve called as Talking With the Experts. We started with real estate lawyers and mortgage brokers. This week was a conversation with Mayor Cam Guthrie. We look for leaders and experts in various fields to help inform and educate you about real estate and the community in general.
This coming Wednesday morning we’ll be sitting down with a local emergency room physician and get an in-depth and personal take on what COVID-19 is doing to our community, and how we can continue to do our part.
To close — right now is a time of reckoning. I’m grateful for this time and opportunity to hit that reset button, define who and what we will be in the future, and set that course to move forward.
Thank you for reading and being part of our journey.
Paul
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