A Few Numbers For You

There were 28.9% fewer real estate listings in January than in the same month last year. And there were a whopping 71.7% fewer than in January 2020, which is really quite remarkable. It’s as if a stream has been dammed. Buyers and agents descend on any decent listing like vultures.

The average sale price in January was 27.2% higher than last year and 61.6% higher than in January 2020. (The average sale price is more than double what it was five years ago, and that, to be clear, is obscene.)

So is it a good time to sell? Well yes and no. If you’ve already got somewhere else to go, perhaps it is, yes. And if you’re leaving the country or moving into a rental, then sure. You’ll make out like a bandit. But if you have to buy something new for yourself then you need to be mighty careful. Prices are rising so fast that if you sell this week and don’t find your next home for a couple of months, you may well find that your buying power has been significantly diminished.

Doing things in the right order is vital. You should talk to your agent about the risks and benefits of making a move this year, and how to organize your search, because it’s not always as straightforward as it might seem. And Covid makes things more difficult. Viewing houses, or showing your own, is not something to be taken lightly.

And what about first-time buyers, trying desperately to pull together a downpayment before interest rates go up? Well for them, it’s a nasty, discouraging sort of market. And we think that prices will rise by at least another 10% this year. Getting in now, if you possibly can, is still the right move (if home ownership is a life goal). We just don’t see a contraction of any sort on the immediate horizon; Kingston’s real estate market is as protected and stable as any we know of. But we’ve had several clients give up their searches and resign themselves to renting for the foreseeable future.

And what’s causing all this? Well there are forces convulsing markets worldwide, but locally a lot of it has to do with all the agents from Toronto coming to town with their clients and paying preposterous amounts for housing. These agents have no experience in our market, no local expertise whatsoever (and so really shouldn’t be representing clients here in the first place), but their clients often have deep pockets and a desperate desire to swap the big city for a smallish town. The local market is being distorted by their inability to figure out true market value. They’re shopping with blindfolds. A lawyer last week told me that she does more business with lawyers from Toronto these days than she does with local colleagues.

Trouble is, we don’t see a balanced market returning any time soon. And by that we mean a market in which the number of buyers and sellers is roughly equal, supply meeting demand. When that does happen, buyers will be able to write offers that actually allow time for a building inspection, and a moment to properly sort out financing. Showings will be allowed to last more than the stupid 30 minutes on offer at the moment, and they won’t overlap with each other. There will be time to breathe, in other words, and we can’t wait. But in the meantime, we urge that you move cautiously, and seek out good counsel. 

Stay well out there.