Resilient York Region Real Estate Market Defying Odds

As we wrap up week one of York Region heading into Phase 2 of the COVID-19 Return To Normal Procedures, we're starting to see the effects this has had on the Real Estate Market. 

Lots of rumours and predictions from "market experts" over the past few weeks. These economists have placed their odds on the market taking a double digit hit post covid-19.  Let's take a look at sales by week.  Sales are bouncing back due to pent up demand and buyer confidence returning.  

By breaking through the 300 sales per week mark for the second week in a row, we've hit level we have not seen since the pandemic shutdowns began.  Now, let's take a look at the key contributing factors.  Interest rates are lower now then they were pre-pandemic.  Some buyers are trying to beat the July 1st Deadline that CMHC has imposed on their rule changes.  Pent up demand has buyers flooding the market, looking to scoop their next home.  

How is Inventory holding up?  The largest contributor to bidding wars and higher than average appreciation is our lack of inventory.  

We are starting to see more listings hit the market, as per the above chart.  Here's the issue ... There are three types of markets:  1. A sellers' market (0-4 months of inventory). 2.  A balanced market (4-6 months of inventory)   3.  A buyers' market (over 6 months of inventory).  Looking what new listings vs sales, we are still in the 2-2.5 months of inventory range, which remains a strong sellers' market.  This will continue to put upwards pressure on price and bidding wars will continue.

 What happens to the Ask to Sell ratio in a market like this?  With more buyers coming out to purchase homes, and inventory as limited as it is, bidding wars will continue to be a key factor and drive pricing up.  Since the restrictions were eased for York Region, we have seen a return to homes selling for over asking becoming the norm.  

Unless we have an influx of inventory on the horizon, look for this trend to continue.  The problem with the economists that are forecasting huge price drops is that they don't understand the dynamics of the market.  By setting false expectations of a price drop, they are actually costing buyers much of their buying power.  

Let's look at average price and how that has faired for York Region over the last 12 weeks.  

The average price has remained strong through the pandemic restrictions and now we are seeing prices increase beyond where they were prior to the pandemic hitting.  This is going to continue through the next couple of months and we may see a softening if we get hit with a second wave.  However, the price growth in between then and now will be consistent and we will close off the year on a positive note.  

York Region Real Estate doesn't seem to care about what people think, it's marching to it's own beat and creating its own path. In short, York Region Real Estate is fighting mad and sending a clear message, it's back!  For an accurate read on what your area is doing, ask a Realtor.  For York Region South call 905-554-5522, York Region North call 905-478-1101.  We've got you covered.