In spite of the on-going Covid-19 pandemic the real estate market in Hamilton and Burlington area has been red hot over the past few months.
But can this HOT “Sellers Market” Continue? Whether you are actively paying attention or just watching from the sidelines it can be difficult to make sense of the real estate activity over the past few months in our local Hamilton/Burlington market.
A good place to start is to review the statists from September (the latest data available).
Some of the takeaways from the September statistics:
- Sales are up 37.7% over last month and up 53.9% over September of 2019 – WOW!
- The average price for residential properties was $721,354 which is up 19.8% from September of last year.
- Active listings available at the end of the month was 40.4% lower compared to the previous year
- 50% more sales in Hamilton with only 4.8% increase in listings compared to September of last year
- Following public health guidelines and best practices active Realtors such as myself continue to be able to safely list, market and show homes during these unprecedented times.
Why is the market so hot when times are so uncertain?
Before we answer this question it is important to review the key take aways from the roller coaster ride the 2020 market has been so far:
- From January through the middle of March the market was red hot. With extremely low listing inventory and ever increasing demand from buyers the market was reaching new heights.
- Both sale volume and average sale price were increasing week after week.
- Spring Lock Down brought great uncertainty and real concern for buyers and sellers alike. The lockdown resulted in a 5-6 week “slow down” for Real Estate. With few new listings hitting the market and lower than average sales volume
- However since lock-down the market has picked right back up and has surpassed the levels we were seeing earlier this year!
As the real estate market continues to be pushed forward by supply and demand, life does continue to move forward. Families grow larger, grow smaller, couples get together, couples separate, jobs change, people change – life does go on. The combination of very low listing inventory and high demand from buyers looking to move up the property latter or move in to our region is resulting in higher sales volume and higher average sale prices.
There is no doubt that peoples livelihood continue to be impacted by Covid-19. Most businesses are still struggling – the financial impact of Covid-19 is very real and very serious. So it can be confusing to see such a hot market while things are so uncertain. As the economy continues to shift and governments continue to invest more and more resources people are doing their best to adapt and adjust. This uncertainty combined with the end of some mortgage deferrals will lead to increase pressure on some home owners.
If some home homeowners are forced to sell, provided the market has not been flooded with listings, they should still be able to find their buyers. Whether buyers are coming from out of town looking to take advantage of everything Hamilton has to offer or buyers are currently living at home or renting – there are many eager buyers still looking to jump into the market.
But can this “Hot Sellers Market” continue?
Even as uncertainty is looming in our economy – the local real estate market appears stronger than ever. There are still many buyers looking from out of town. Buyers who can “cash out” and leave congested big cities and buy in our region where some listings are still great value (compared to Toronto prices). There are also lots of first-time home buyers who are tired of renting or living at home who are more than ready to dip their toes into the market.
The biggest concern for this market is if the market gets flooded with listings. As more and more sellers see their neighbours sell for higher and higher prices, they might think they too can “cash out” and sell high. If they do not take the time to properly prepare, price and market their home it may not sell – and we could see a saturation of new listings… listings sitting and not selling. The public doesn’t always see “price” as the main indicator as to why homes do not sell. If the public sees more and more properties on the market, the perception of a “Hot” market could shift quickly.
If active listing numbers continue to rise and there is a flood of listings on the market – this record high sellers market may soften.
If buyers find themselves in an exposed position (having bought a new property without being able to sell for what they thought they could) the market could shift quickly.
As always, In terms of future forecasting there is not a one size fits all answer. Keep in mind even in a more traditional, non-pandemic market, we as Realtors have never had the ability to guarantee any of our market predictions. They are educated best guesses.
Be informed and be cautious when buying and selling in this market – Use a professional and experienced Realtor.
One thing that remains constant is that I will always give you the best advice for your specific situation. And it will be fluid, it will be dynamic and it will be tailored to your criteria and timeline and will be educated and informed with the latest data we have available. This will be updated as we move forward along through the process. Just like it always should be.
Any questions, call anytime