With the current state of the real estate market, it is important to know how to properly prepare and navigate yourself to make sure you make the right decision. In this blog, we will be taking you through some recent data gathered on the current market, what type of market we are dealing with, and how to prepare yourself for making the best decisions for you and your future.
What is the Data Showing us?
The current housing market has changed quite a bit from its record-setting streak during the pandemic and peak in February 2022. It went from being red hot to ice cold within recent months. As the peak listings were only lasting a few days on the market, now a lot of properties seem to be sitting for a lot longer while also having to reduce their prices.
Additionally, due to the recent rise in interest rates the rental market has become a more popular market nationwide. Its popularity has unfortunately caused rent to become more expensive and given landlords in Ontario the opportunity to raise rent to the highest level seen in a decade. Check out some of the data and statistics we gathered for you.
Here are some eye-catching statistics gathered by the Canadian Real Estate Association.
- National home sales fell by 5.6% on a month-over-month basis in June.
- Monthly activity came in 23.9% below the June record set in 2021.
- The number of newly listed properties was up 4.1% month-over-month.
- The national sale price posted a 1.8% year-over-year decline in June.
Housing Market statistics are brought to you by CBC news.
- In the month of June, the average price of a Canadian home that was sold was going for $711,000, a steep drop of more than $100,000 in the past few months.
- It was also first reported by the CREA, that in the month of May, the volume of homes sold dropped by 20% compared to the exact same time a year ago in 2021.
Rent statistics are brought to you by the Toronto Regional Real Estate Board.
- The average one-bedroom condominium apartment rent increased by 17.8% to $2,145 in Q1 2022, from $1,820 in Q1 2021.
- The average two-bedroom rent was $2,867 in Q1 2022 – up by 17.2% year-over-year compared to the average of $2,446 in Q1 2021.
Buyers or Seller’s Market?
Based on this data and statistics, is it a buyer or seller’s market? All indications point towards a buyer’s market. This simply means there are more houses on the market than active buyers looking for new homes.
Which can help potential buyers in many ways such as:
- More listing options: You have an abundance of options and styles to choose from compared to a seller’s market where there are limited listings, and everything seems to sell and move a lot faster.
- An advantage in negotiations: Buyers have a lot more room to negotiate with sellers when it comes to a specific listing. Due to the surplus of listings, houses will tend to sit on the market longer compared to a seller’s market. Which in turn will only give the buyer more negotiation leverage.
- Time: Compared to being in a seller’s market, you will have more time to look over your options and the opportunity to talk and negotiate with sellers compared to a seller’s market, where all these things are the complete opposite and things are more chaotic.
What Are Most People Looking for in This Market?
In the current real estate market, the most popular trend has become renting properties. Buying properties is still common but not even close to the rate at which they were a few months ago. With the rise of inflation, high-interest rates, and an unstable market, people are hesitant to buy property. Which in turn has led to the popularity of renting. Unfortunately, there have been some downsides to this rising popularity. The renting property market has become so popular it has led to a limited supply of options which then raises the price of any property that is available. As well as raising the rent for current renters across Canada.
How Should I Prepare for this Market?
It depends on the situation you are in as a buyer, seller, or renter.
You have a lot of leverage when it comes to buying a property. You have a surplus of options to pick from and don’t have to settle on a property you aren’t entirely in love with. Negotiation leverage and more importantly time to decide.
You will have trouble getting the same amount of attention listings were getting a few months ago when some listings were barely on the market for a week. It may take some time to find the right buyer interested in your property and give the buyer an advantage in lowering the price at which you listed the property. Patience will be a key factor in dealing with this current market as a seller, if not, I would consider not listing your property in this current market.
The current market situation has made things a little bit more difficult than usual. When looking for a property to rent be prepared to see prices higher than expected in recent years. If you are already renting expect to see that the current rent raise is higher than expected. In some areas across the country, for example, in Ontario, landlords could raise rent to the highest this country has seen in over a decade.
Everybody’s situation is different, but we hope you keep this data and advice in mind when navigating the current real estate market. Hopefully, this guide has helped and made it easier for you to move forward.