As you know, the aggregate price of real estate is dropping.
Some real estate professionals and media outlets are very optimistic about the current market. We’ve heard things like,
“Now is the best time to buy!”
“Affordability isn’t affecting the market.”
“Pent up buyer demand will keep the market strong in early 2023.”
We disagree with all of the statements above. Through our research in our local markets, including Hamilton, Niagara, Toronto and Oxford County, we’ve come to three main conclusions:
- As interest rates increase, the median price of real estate decreases. Reduced affordability isaffecting the market.
- The price of real estate across the board has been reduced to the prices we were seeing in December, 2020 and January, 2021. That means the market has lost all of the gains it saw through 2021 and 2022.
- The current trends all point towards prices continuing to decrease. Inventory is the highest it’s been in years, and buyer demand is at its lowest.
Looking forward, there are three key factors in the inevitable growth of the real estate market:
- There is still a huge housing shortage in Canada, and specifically within the Golden Horseshoe (Oshawa to Niagara Falls).
- Immigration to Canada from around the world will continue to drive demand in the housing market.
- There will be a pent up buyer demand once we are on the other side of our current inflationary and affordability crisis. This will further exasperate the housing shortage and contribute to strong growth in the real estate market.
If you’re planning to buy your first home, your next home, or an investment property, when will be the best time to buy?
- While we expect home prices to keep declining during the next few months, they will likely begin to go up again during the last few months of this year.
- If you need to sell your home to buy your next one, pricing properly, staging and timing have all never been more important. We have you covered on all fronts!
First time home buyers – you should be planning to buy within the next few months, when we expect prices to be at their lowest.
Sellers, we’ll give you a strategy based on the current market conditions.
Investors, plan to leverage all of your cash and borrowing power within the next few months to buy investment properties with a great return on investment while maximizing your future appreciation potential on the property you purchase.
If you haven’t already, check out this video we released in November of last year.
Henk makes a bold prediction about real estate prices and walks you through all of the statistics in the Stoney Creek market. Spoiler alert: the trends we see in Stoney Creek are consistent with the trends we’ve seen in every other market in the Golden Horseshoe!
If you have any questions about the current market, we encourage you to reach out to us! Feel free to call, text or email.
Enjoy this cold January week, and remember, there is more and more daylight with each day that passes. Just as a real estate market bounce-back is inevitable, so is spring!
Emese Zaduban & Henk Vanden Beukel