PUBLIC OPINION
A significant improvement in sales being reported this week – whew! Finally, we are seeing some decent numbers. 52 homes were reported sold in Guelph and the surrounding townships this past week. Numbers were also up significantly in KW and Cambridge.
While 52 homes sold during what is still a state of emergency within Ontario, it does represent almost 60% of the sales (87 homes sold) we reported for the same week last year. A positive trend to say the least. Now for the good news, depending on which side of the transaction you are on: 46.15%, or 24 out of 52 homes, sold at or above list price this past week. The conditions for a strong seller’s market are still present and have a strong grip on the market. Last year we reported 44.83%, or 39 out of the 87 homes sold that week went at or above list.
Clearly this doesn’t square with the headlines and press releases from CMHC these last few weeks.
More on that in a bit.
Now, before we get carried away with the notion that this could mean the great COVID-19 real estate freeze is over, there are still a ton of variables that could reverse this process and see the numbers start to drop again. Certainly if we don’t keep to the social distancing protocols, the state of emergency will be extended and additional waves of COVID-19 cases will wash over the province. We’re all dancing on a thread. The nice weather, cabin fever and the desire to get on with life are all pushing us.
Real estate services are still an essential service and we will continue to be available for all of our clients. We have continued to refine our protocols for visiting properties and how we conduct business. Don’t expect things to return to what was normal a few months ago. Expect us to continue to do most of our business remotely, utilizing technology to meet online with clients and walk people through homes virtually before allowing in-person showings. We’ve been producing a weekly webinar called Talking With The Experts where we take a deep dive into how each of the services that are critical to successful real estate transactions are adapting and continuing to offer their services during the pandemic. If you missed this week’s episode on home renovations and staging, you can watch it below.
We’ve been fielding a lot of questions from sellers and buyers about where the market is going and what we predict will happen. There’s a lot of nervous energy in the market that is probably holding us back from getting closer to where the market should be. Next Thursday, June 4th we’ll be hosting a webinar to address the Top 10 Questions Homeowners Have About Selling During COVID-19. Stay tuned for more information and our sign up form. If you’re a seller in this market, you won’t want to miss this information packed session!
Earlier this week I sat in on a webinar put on by the Toronto Real Estate Board. This hour-long session reviewed a poll conducted on behalf of TRREB by IPSOS polling.
One of the highlights from this poll is that confidence in our politicians is high, regarding their management of the crisis – with Doug Ford surprising everyone with his skill in leading Ontario. However, even as Ontario starts the reopening process, comfort levels are still quite low regarding engaging in public activities and travel. 83% of those polled agree that we need the ability and capacity to test widely for COVID-19 before opening up businesses and society again, and 64% believed that we need the ability to actually vaccinate against COVID-19 prior to opening up.
From a housing perspective, interest in buying a home has remained relatively unchanged from the 5 year trend, with 27% of people expressing intentions of buying in the GTA. Of those not looking to buy in the next year, 16% cited the pandemic was influencing their decision to stay put. The bulk 62% stated they were not planning to buy simply because they like their current home and location.
For homeowners, selling intentions are down, with 17% likely to sell in the next 12 months (compared to 39% in the Fall of 2019). When asked why they aren’t planning to sell, 80% of respondents said they like their current home and location, while 22% indicate they won’t sell because of factors related to COVID-19.
Of those planning to sell, 40% said that they already had plans to sell before the pandemic and were committed to continuing with their plan. One third of respondents said that their financial situation has now changed and they must sell as a result.
It seems GTA residents believe that the pandemic will slow the market – that fewer buyers will be looking for homes and fewer homeowners listing their properties – which they think will ultimately lead to softer prices.
Interesting observations, and many will translate to our local markets as consumer sentiments are similar in both markets.
Depending on the numbers of buyers that remain on the sidelines and the number of homeowners that step back from selling, I’m not sure I expect to see a significant drop in house prices. Despite the 50%+ reduction in sales activity over the past 2.5 months, our median sales price is still higher than 2019. While we likely won’t see the peak we did in early March, I still believe we will finish 2020 with a higher median sales price over 2019.
You can be confident that we are watching this closely and will be advising you on any trends as we see them develop.
If you have any questions please reach out to me or any of the HGR team. We would be honoured to have an in-depth conversation with you on any of these topics.
If you are looking for detailed information on the sale of your home, or your purchasing intentions, we are always available for a no-obligation consultation.
Stay safe and enjoy the weekend.
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