Warning signs for sellers
The elected leaders argue that all politics is local. The same is true for real estate.
Cities and neighborhoods on demand have always bucked broad national trends. Things like quality schools, livability and access to cultural amenities will always help home sellers get top dollar.
But the latest numbers are hard to ignore.
According to the latest statistics from the Canadian Real Estate Association, national home prices fell 5.3 per cent month over month in July and the national median home price was $629,971 – down 5% from last year.
Buyers and sellers seem to be waiting to see if and when the market stabilizes before making any moves. The number of homes listed also fell by 5.3%, indicating that homeowners are not so quick to put their homes up for sale.
However, it is a good time to sell
Although many leading indicators may indicate that we have entered a cool phase, a few critical factors make now a good time to sell – you’re ready to list.
Demand: Homes may be on the market for a long time, but demand is relatively high, and housing inventory is low compared to years past. Canada’s east coast continues to see rising home prices, and the same is true across the Prairies.
All-Cash: If you live in a low-inventory market and buyers are outselling their properties, sellers can expect to make money — sometimes literally. The all-cash market is hot right now, which is great news for sellers because cash offers often speed up the closing process. You can even get discounts that aren’t based on reviews, guaranteeing you receive the discount price.
Rate hikes: While rising interest rates may work against sellers — higher rates mean bigger monthly mortgages — the looming increase may cause some buyers to lock in rates now. The average rate on a five-year fixed mortgage is now around 4.85%, more than 2 percentage points higher than rates a year ago.
A good time to wait
There are good reasons to sell. But there are as many as they hold fast.
Your own plan: What happens if your home sells quickly? Do you have a plan for the income from the sale? Need to start hunting for your new place?
Your new mortgage: If you’re selling because you need a bigger home, this jump may not work, especially if you’re looking in a popular neighborhood or city. A new, larger property can absorb the profit on the property that was just sold and still carry a larger monthly mortgage payment.
Rate hikes (again): Those Canadian bank rate hikes can work against you as a seller. It reduces the pool of buyers by making it difficult for typical mortgage buyers to purchase your property.
Get good advice
A great real estate transaction – whether as a buyer or seller – begins with a thorough self-investigation. Why buy or sell and why now? Take these answers to an experienced agent who knows your area.
An agent is usually your best compass for what your city or neighborhood is asking or paying.
You are 5 minutes away from the best loan
Finding the perfect mortgage doesn’t have to be difficult.
Homewise is a completely free online broker that negotiates on your behalf with over 30 major banks and other lenders, and it only takes five minutes to apply.
If you’re in the market for a new loan or looking to refinance before interest rates rise again, head over to Homewise now and answer a few simple questions to get started.