It seems hard to believe we are well into September with warm days still, but the coolness in the air at night is a sure sign of Fall. I don’t know about you, but this is my favourite time of year! I am ready to wear stylish blazers, jaunty scarves, and enjoy the colourful leaves and pumpkin spice latte.
If you’ve been following the real estate market this year, you know that it’s been quite the ride. After two years of 18% annual price growth and hearty competition amongst buyers, we see conditions change dramatically and in real-time. This will likely continue with yet another Bank of Canada rate hike in October, on top of the September rate hike we’ve just had.
The interest rate hikes are already dragging down inflation and economists predict we may see the inflation rate decrease to 3% sometime in late Spring 2023. With that said, we haven’t seen a super heavy retraction in housing prices. The average sold price in July was still 0.9% higher year-over-year.
We found that ‘upsizing’ buyers are the main purchasers right now as they have built-up equity in their existing homes. They are less susceptible to a loss in purchasing power. These are the buyers who are taking advantage of the market conditions right now. August sales activity spiked and it’s been the best we’ve seen in months – it’s an early start to the Fall market.
What’s the silver lining in a post-pandemic real estate market?
The beauty of this market is balance, time and more choice for buyers. Sellers are adjusting their expectations and buyers are more selective. We’re seeing buyers who took a wait-and-see approach last April restart their search. Why? Because rents are going up and life goes on. People need homes that suit their changing lives.
Are you ready to jump into the market?