The question every Realtor gets asked daily is “How’s the Market?” Well, the short answer is, it’s a buyer’s market. This means the housing supply exceeds demand, giving buyers negotiating advantage. Prices typically fall during this market and properties often have longer listing times. This gives buyers more time to compare properties, have multiple viewings and feel confident about including conditions without risking rejection. But the real question everyone wants to know is why did the market shift, is it normal and will it return to a more balanced market and when?
Economic decrease (trade disruptions/tariff unknowns, inflation, tighter credit, job losses and of course higher interest rates) is causing buyers to be more cautious. People are uncertain and hesitant to make a large purchase such as a home or increased rates make it financially out of reach. The federal government also passed The Prohibition of Purchase of Residential Property by Non-Canadians Act effective Jan 1, 2023- Jan 1-2027 to curb increasing home prices.
One of the most fundamental patterns in real estate history is that the housing market naturally cycles between buyer’s and seller’s conditions. In 1989 a boom collapsed after rate hikes, then it was a long buyer’s market through the early 1990’s. It was relatively balanced till 2000’s. 2015 – 2017 was a strong seller market with low inventory. 2018-2019 became balanced again followed by an extreme seller’s market in 2020-2021 before once again becoming balanced and now buyer’s market.
Real estate typically follows the stock market which is increasing plus interest rates are decreasing to help stimulate the economy. The provincial government just passed the removal of the 8% provincial portion of hst for first time home buyers on newly-built homes valued up to $1 million, meaning up to a $80 000 saving. All signs pointing to a more balanced market coming but having said that nobody has a crystal ball or knows what can happen or when. Starter homes and first-time homebuyers have historically been the “driver” of the housing market; they represent the entry point to the property ladder.
Looking to buy or sell in this market, I would love to help! Reach out at 226-232-4236 or il**************@***il.com