Market Update June 2022

What’s happening to prices and activity?

What's happening to prices?

Here’s my 2 cents for the week. If you don’t want to read all of it, jump ahead to the 3rd paragraph from the end.

The end of May – Usually this weekend marks the beginning of planting season. As the weather gets warmer we move outside and once again the raw beauty of the West Coast really sets in. It’s a great weekend here but temperatures are still lower than expected (or wanted) and it seems that the Real Estate market is towing the same line.

Here are a few of the items that the Bank of Canada, the Canadian Real Estate Assoc and other large organizations that have an understanding of the economic climate have said are impacting the Real Estate market right now.
Bank Rates – We saw the largest rate increase in more than 2 decades of .5%. Expectations are that it will increase until the BOC sees inflation come under control and get closer to the 2-3% it deems viable and sustainable. The 5 year rate is as low as 3.79 and up over 5% depending on the institution.

Some of the other factors are – COVID, Supply chain issues, The war in Ukranine and general rising worldwide tensions. On the plus side, the unemployment rate is currently at 5.3% and is the lowest it has been since comparable data became available in 1976

So… how does this really affect our local Real Estate market?
Reduced urgency by buyers to purchase
The appearance of a falling market
Price reductions at all price points
Fewer multiple offers
Most offers now come with subjects (financing, inspections and others)
Happier buyers as they can relax and spend more time reviewing their options (less urgency)
A longer selling timeline
And… the all important component to selling – “Pricing Properly” Here’s video on pricing and offers: https://youtu.be/wAFl4Rv3zNs

I would rather be turning down offers that are too low vs not getting any offers to work with.

Price solves everything and now, as we move from a Sellers market to a balanced and eventually a Buyers market, we need to be ahead of the curve. If you need to sell or just really want to sell, throw out the “my neighbour sold for x so I want x+2” and assess what is the number that you can afford to sell at.

Price your home literally as low as you can go. If it’s below market… we will generate multiple offers and yes, we are still getting these. Buyers are savvy and there are still lots of them out looking. What we don’t want to do is ‘chase’ the market down and be selling in 3 months below what we could have sold for today. Your home is still going to sell 30-50% higher than 2 years ago but not as high as 2 months ago.

On a personal level I had COVID and that’s now in the rear-view mirror. I still have a lingering cough but all in all feeling good. Lucky for me I have a rock solid team that keeps everything moving along, the weather is nice and I have a vacant basement suite to quarantine in. I just heard that Jimmy Kimmel just got Covid for the 2nd time in 3 weeks – Ouch! Fingers crossed that I dodge that bullet.

Every property is unique so do not hesitate to reach out to discuss your property and how I think the market has affected value.
Warm regards,
Martin

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