Now sellers don't despair, there are still lots of buyers out there ready to pay a fair price for a good property, though admittedly the top of the market in the short term was likely in late March or early April. That being said just this evening I sold one of my listings, a great downtown condo with two offers and we pushed the price up $5800... so I'm pleased to have another happy seller. I sold another listing last week, could potentially sell another tomorrow and the traffic has generally been good at all but one of my listings.
Buyers..the time has finally arrived where you don't necessarily have to duke it out to get a great property for a fair price. Last night, for the first time in quite a while I had a buyer actually purchase a property without competing and we negotiated almost $15,000 off the list price. A refreshing change from what otherwise seemed like a steady diet of multiple offers and competition. I have definitely noticed a lot of good properties with offer dates that didn't receive offers on the anointed date. This is a clear sign that buyers are regaining some of the negotiating leverage. I do hope this continues for the foreseeable future.
For those of you who already own and plan to stay, or have been thinking about moving to a new property this shift is good for you as well. The market has climbed a lot in a very short time. I believe this climb is all based on good fundamentals and is in large part a recovery from the recession and thanks to the excellent interest rate policies of the Bank of Canada. If we continued at the pace we have been on a real estate bubble could very well have formed which then risks another real estate downturn. Many analysts have been sounding the alarm bell on this front, but generally I think the current shift will reduce the risk of too much too fast. This balancing out will moderate price appreciation, make it easier for people to buy, and yet sellers can still sell their properties with healthy demand. I expect that the next 6 months or more will be steady and measured which is good for the market overall.
So just what is happening out there? Ignore the noise on the HST and rising interest rates, yes these have some impact but the real story is Inventory and the supply and demand curve, which is so influential on market behaviour and direction... Essentially the inventory has finally rebounded to take some of the steam out of the sellers market. The Toronto Real Estate Board (TREB) reported that a stunning 20,683 new listings came on the market in April, this represents a 59% increase in available listings. This is nearly 10,000 more new listings than properties sold. This dramatic increase in listings has shifted the balance in the market from one that clearly favoured the seller, to one that is more measured between buyers and sellers.
At right is a chart from one of the many TREB Districts that I follow closely for my clients. I chart a wide variety of market statistics to understand where we have come from to identify trends and emerging trends. Quality data helps to inform decis
ions and improve outcomes. This chart compares listing statistics for 2010 to those in 2009. Essential we see whether solds, new listings and available listings are higher or lower than the year before period, and this is charted by month so we can identify market trends and directions. From this graphic, which looks very similar for many TREB districts we see that sales have remained generally higher than 2009 from January through to April, but not dramatically so. The inventory of available homes on the other hand remained substantially below last year levels and only in the past two months has the volume of new listings increased to well above last years levels ultimately bringing the overall inventory of homes higher as well.In conclusion the market has shifted and this is good for all players - sellers can still sell, buyers have more choice and value should be protected with a steady market for the balance of the year.
