Fall Market Update
September 1st – November 30th
By: John Wiebe
The number one question realtors get asked is: “How’s the market?”. We’re hoping this post will shed some light on this very loaded question. In the past 2 years or so the local real estate market has been a whirlwind of bidding wars and homes flying off the shelves as soon as they become available. This “Sellers Market” had continually rising house prices resulting from record low interest rates and abundant buyers for very few listings.
During a Sellers Market being a buyer was incredibly stressful. You checked websites and social media daily hoping you wouldn’t miss out on any new listings. When a listing came up that was somewhat close to what you’re interested in, you immediately booked a showing. You were allotted a 30-minute time slot to go and look at a home (which may be your most valuable purchase of your life) and were required to make an almost immediate decision. During these times, a frequently asked question was: “how much more than list price are we going to have to bid?”. A question that in most cases was almost impossible to answer. Times have officially changed.
“This is the best time to buy a house in the next 5 years.” World renown finance guru and real estate investor Dave Ramsey said this on his radio show recently. We agree, and here is why.
Despite the negativity circling those changes (rising interest rates, inflation, etc.) if you’re a buyer, things are turning in your favour. Yes, interest rates are substantially higher than they were even 1 year ago. However, in the past 20 years when we’ve seen the Bank of Canada raise their lending rate even higher than it currently is, it has never lasted more than 2 years. As long as you don’t lock in your mortgage rate for a long term, when interest rates drop you can refinance and reduce your payments.
The current market is transitioning from a balanced market to a buyers market (especially in higher price point homes). This allows buyers to pick and choose the house that’s right for them, take some time to think about their decision, and then negotiate a favourable price – all things that buyers did not have the luxury of doing for the past 2 years in most cases.
Another frequently asked question is, “Have house prices dropped?” At this point, the prices have plateaued with the exception of a few homes where specific circumstances have caused them to sell for less than anticipated. Below is a graph showing how close sellers are getting to their asking price.
MLS stats are from residential sales within 15kms of Winkler.
As you can see, sellers are still getting very close to their asking price. However, their asking price may have to be slightly more competitive than the past 2 years due to the reduce buyer motivation.
The old real estate adage is still true today, “the best time to buy real estate was 5 years ago, the second-best time is today”. If you have any questions about the changing market feel free to contact me, John Wiebe or your Choice Realty agent and we’d be happy to help you out.
John Wiebe 204.362.2745 john@choicerealtyltd.com
