What a crazy year for real estate.COVID certainly didn’t stop people from buying or selling.In fact we saw an 8% increase in sales over the previous year.I personally feel there were a few converging ideas.Some of them had to do with the trends which I addressed in Real Estate Trends 2020 but I also felt there was a large movement of single family investment properties.With record sale prices (15% over 2019) and with so much uncertainty with tenant rights during COVID, I think these types of investors are thinking its time to cash out while the going is good.
On the other side of the coin we are seeing multi-residential buildings flying off the table including places like Napanee and Gananoque. Toronto investors are swooping in and taking advantage of much lower pricing.
2020 was also the year we had a record number of house sales with multiple offers.My prediction is that 2021 will bring more of the same.Let’s hope I’m wrong!
As this year progresses, the real estate market remains unpredictable and crazy. As the COVID cases rise we may see a downward shift in sales activity this winter.I am personally seeing a bit of what I call “OFFER FATIGUE” from buyers.Some feeling a bit of hopelessness.Who would have thought it would be so hard to purchase a home.
But with so much economic turmoil, the question remains as to the effect this will have on the housing market in the coming months.There seems to be consensus that next year we will see a softening of the market.I’m not so certain this will happen in Kingston and Area as we continue to have a greater demand for single family homes, as well as a increasing portion of out-of-town cash buyers .
The impact of COVID-19 on the housing market is complex, and we believe it will lead to diverging price trends among regions and housing categories. The pandemic is affecting demand and supply of various market segments quite differently. It is cooling demand for and boosting supply of rentals in large urban areas. This, in turn, is reducing investor interest in condos. The pandemic is also altering the housing needs of many current owners who look for more spacious properties in less crowded settings. This is simultaneously shifting demand from condo apartments to single-detached homes and other low-rise categories, and increasing the supply of smaller condos in core urban areas. Work-from-home arrangements and the lesser appeal of big-city living (with reduced cultural and socializing opportunities during these times of social distancing) are increasingly driving buyers further away from downtown locations into suburbs, exurbs and even cottage country. We believe this trend will sustain strong demand in smaller markets, putting intense pressure on their housing stock. The bottom line is we expect condo prices to weaken in larger markets next year, while we see prices for single-detached homes remaining generally resilient—albeit increasing at a slower pace. “RBC
There continues to be a good percentage of homes which are going for over asking price.More people are now offering greater amounts of money to get a home.Recently a house priced at $259,000, sold for $350,000.It had 17 offers.The question is was this house actually only worth $259k or $350k to begin with?
Year to date we have seen a 14% increase over same period last year for the Kingston & Area market.September sales were higher and as you can see the days on market was significantly less for the month of September.
Despite being in the middle of a pandemic, Canada housing market shattered records in July. What the fall brings to the housing market will be anyone’s guess. There are still many uncertainties. Questions remain as to how the changes to the federal CERB program, which is due to change in October, and the mortgage deferral program, which is set to end around the same time, will effect Buyers & Sellers. Approx. 16% of mortgagors have deferred at least one payment. Has this put homeowners into a financial situation in which they will not recover from? I personally think there will absolutely be casualties which will result in mortgage defaults. The extent will not be known till later this year and perhaps into next.
Amongst these Canadians, are workers who have not yet been able to get back to work. The hybrid model for school reopening will leave parents without options for childcare.Those who can go work may be making difficult choices. And amongst all this chaos is whether there will be a resurgence of new cases. Let us not forget that the U.S.A. is in the middle of a presidential election!
As you can see… so many questions… not enough answers. Is it the right time to buy, sell, or hold? Will prices continue to go up or down? Each buyer or seller is unique and I’d be happy to discuss your situation in person or by phone.
If you know of someone thinking about buying or selling I’m always looking for more great people like yourself.Always here to help!
Last month I showed that the number of sales over the same period as last year was down by almost 20%.July’s sales were strong and the gap is closing-in with now recording only an 8% drop YTD.Still low based on history in the Kingston & area but it shows that despite COVID, people are still buying homes.
Average SOLD price YTD is slightly up over last month with a +11% change.
Average sold price for Kingston & area is now $435,696 with 45% of buyers this year in the $300 k – $450 kprice range.
We continue to see multiple offers on many properties and there appears to be a slight uptick in more aggressively priced offers over last month.But despite this, almost half of all sales were below or at asking price.
Many buyers have been discouraged but if they work with the right Realtor® that can provide guidance, their success in finding the right home will be greater.
COVID-19 and the subsequent lockdowns have certainly shifted our “spring” market. June has seen the flood gates open as Kingston and area went into Phase 2 of reopening. Although sellers have not completely embraced listing their homes at this time, we are seeing buyers out in full competitive force.
Our average SOLD price Year-To-Date 2020 has seen a 10% increase over the same period as last year . Prices prices have been affected by mainly the lack of inventory & the number of buyers. Listings are down 16% from the same period last year. To give you another perspective as well, Kingston and area has seen a sellers market for the last 4 years. So if we compare with the number of houses listed from 2015 (same period), inventory is down 46% from that time frame.
Recent CMHC rule changes which came into effect July 1st, in addition to mortgage companies increased scrutiny of the buyers employment records due to COVID, are going to make things tougher for buyers. We are just not seeing the effects of this in Kingston yet.
MULTIPLE OFFERS Buyer are increasing finding themselves in multiple offer situations in today’s market. This is discouraging to many. To buyers, it appears ALL houses are in “bidding wars” which in fact only 30% of sales sold over asking. How much over asking is another good question. This table shows 2019 vs 2020 $$ over ask price. As you can see the bulk of those which did sell over asking (the 30%), were distributed between $1 – $20,000 .
Without perspective, it would appear that there is lots to get discouraged over. I strongly encourage you to work with a Realtor® who has their pulse on what is going on in the market and to provide you with advise which will prepare you for what you need to do to BUY or SELL your home. Additional stress is not what we need right now and certainly not during your house hunting. This is suppose to be a time of joy.
I’m always here to answer your questions. Give me a call!