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Buyers are returning to the market despite higher rates

Buyers are returning to the market despite higher rates

Don’t read the news! Seriously, don’t read the news. Some news articles are saying market is rebounding but other articles are saying sales are still slow. They are both right but they are both wrong. 

Are you confused? Confused as to what is actually happening? Confused about what steps you should take, for your primary home or for your investment portfolio? 

Let me give you some “word on the street” and “boots on the ground” kind of insights and hopefully it will clear things up a bit.

For the past 7-8 years, we’ve seen an uptick of activities around mid/late January all the way through to late March/mid April. The reason is, with the cold weather coming soon to an end, many buyers are getting ready to start their housing plan for the year.

As the Winter thaws and buyers are starting to come out of winter hibernation, the number of monthly sales is starting to increase. 4,783 homes sold in February up over 50% from January’s 3,094 sales.

After two months of sales, the average price of properties sold is $1,073,128. While down from 2021’s average price of $1,095,475, (2022 was an anomaly year), this does not really reflect the market. The greatest impact to the “average price” is the fact that with the increase in borrowing costs, more homes are selling in the lower price ranges. A good example of this is that in February of 2023, 57% of homes sold were under $1,000,000 vs 38% in February 2022.

You see, whether the market is great or mediocre, it all depends on the product, location and condition. Good properties at a lower price brackets in good locations are getting 100+ showings in a week. Resulting in 20-30+ offers. Those that are at the high price point will see less traffic and longer days on the market.

The greatest challenge to the Toronto market continues to be supply. There are just not enough homes for sale to satisfy demand. There are only 9,643 homes available for sale, and prices are poised to increase as those buyers committed to purchase will find themselves in bidding wars.

Wait, aren’t we in a bad market? Haven’t high interest rates killed sales? As you can see from my numbers, the answer is a resounding NO! Sales are occurring in all price ranges. Some buyers have had to adjust their price range or the location of their choice, but buyers are buying and more of them will enter the market as the year progresses.

My best advice is, get in the market as quickly as possible. As the old saying goes,” have you bought your land yet, we are not making any more”!

This is a great time to “trade up”, buy the next level home for you and your family. With our population set to explode, and rental rates up, it’s a great time to buy an investment property as well.

Today, most people are getting their real estate information from someone getting paid minimum wage, sitting in front of a computer screen, wearing a jacket and tie (sometimes no pants, LOL) and purporting to know the market. Do not be fooled, they do NOT know!

It’s a time of opportunity if one knows where to find it. Let me use my knowledge and experience to help you and your family. Give me a call, let’s talk!

Your friend in real estate,

Stephen Sun, Real Estate Broker
Direct: 416.617.9997

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