Weekly Wrap Up...Market slow down may have things getting worse for buyers

As school are in full swing and summer is getting further and further behind us; it seems like the fear of a second COVID wave across Ontario is a real thing. I heard that the provincial government has actually changed their response to COVID tests, trying to ration tests in case they have a spike in demand due to a second wave!

This week also brought the Throne Speech for Trudeau this week. The summary being that the $380+ BILLION in debt was merely a starting point to what is coming. There is no end in sight for short-term rates which will further encourage lending for mortgages. With cheap childcare, 1% mortgages and universal pharmacare on the horizon, clearly the Libs are gearing up for the next election. Who’s going to pay for the spending spree, the 1%-ers of course, with a new tax bracket coming. Interesting times on the political landscape across Canada.

Things picked up again over last week's 'very average week' (almost mirroring our average stats post-COVID). We had more sales, more accepted offers and way more multiple offers...oh and fewer listings. It appears the market slow down may have things getting worse for buyers before it gets better.

With sales and accepted offers both above the averages, and both up over last week, all while new listings are falling. This is putting more pressure on the # of listings available and the overall market selection (bad news for buyers). 

Multiple offers were again off-the-chart this week, and looking at the sale values behind the numbers, WOW there were some big prices above asking. I feel as though when I saw the market starting to slow, the rest of the province didn’t experience the same (unless you were a condo-owner in DT Toronto); and the media has been trumpeting the fact that the housing market continues to go crazy. This may have put some fuel on the fire locally and encouraged buyers to continue with the strong offers.

We are seeing a push back to a pattern of agents under-pricing homes which is very frustrating for buyers. Buyers see a listing that may be priced in their range and get very excited about it (especially when it shows so much better than anything else in the price range). This is a friendly reminder to have the chat with your Realtor about listing prices versus what we think is market value. The conversation I like to have with a lot of my buyers is what would I have listed the house at if I would have taken the listing. We have seen a 50K+ price difference this week in the list to sale prices, and this type of situation can be extremely frustrating for buyers. Just because we as agents think it's worth a certain amount doesn't mean that we will talk you out of seeing it or putting an offer for what you feel the value is; as we don’t have a crystal ball. Ultimately we are here to provide advice and guidance and the buyer is in the driver's seat to make offers they feel comfortable with.

We have had a few agents in our office chat about getting into multiple offers on fixer-upper properties. The comment I made to them is that this is typically when we see the contractors looking for their winter projects; it may be different this year but it seems like the contractors who are working are busier than ever, they will no doubt be a number of them looking for a winter project to keep their crew busy during any downtime; especially when we add to that the sales growth we’ve seen in the market over the last little bit. This will make it more frustrating for first-time buyers who are looking at the entry point to a lot of the marketplace.

As I feel like the market does shift; getting busier for sellers (and power shifting away from buyers), it feels like the available homes that are coming out are actually giving buyers some options of great homes to pick from. This seems like good news for buyers, even though the stats don’t match what the overall feeling is in the market. Maybe this is a leading indicator of the market and will be a sign that things will slow down in the future.

I know some of my weekly observations are a bit contradictory. The numbers show we hit a bottom and are getting busier and shifting more power towards sellers; although the day-to-day business, it feels like the additional listings especially in a few key areas that have been in a listing drought make it seem like buyers are getting some selection. It’s a good sign that more listings are available, but I did comment a few weeks ago how getting back into routines would be a positive and we would most likely see an increase in listings and sales as we get kids back to school and get back into a bit more structured life. This could shift again with the second wave of COVID and we have already seen an order to basically stop open houses (after COVID cases were traced back to that Toronto open house). Ultimately we are in the market I don’t expect to see signification shifts with now until the weather changes and buyers put off the idea of moving during a snow storm.

For now, I hope you are staying safe and enjoying the fall weather before the leaves are gone and the snow and shovelling get started!