As hard as it is to believe, we’re already approaching the end of summer! For some, it’s a relief to know we might catch a break from the heat soon. For hardcore sun lovers, this might come as a disappointment. In any case, the real estate market tends to change with the seasons. Before we move into fall, it’s time for a final summer market update, including a review of supply and demand, and options for buyers and sellers.
What’s happening with supply and demand?
Let’s start with supply and demand in the Barrie market. In general, Canadians are seeing a slowdown in real estate activity across the country, including here in Barrie. Demand has dropped off a bit and more listings are coming up, hinting that the market may have already reached its highest point. Of course, the market still seems busy compared to this point in previous years, but we have seen a definite cooling off over the last several months. Buyer fatigue has helped reduce this crazy demand, which has slowed down price increases. Let’s explore how prices are shifting between different housing markets.
How are different housing types impacted?
Barrie’s condo market saw amazing growth over the first half of 2021. In the first half of 2020, the average sale price of a condominium unit (apartments and townhouses) was $383,778, with units selling for 98.5 percent of their list price. By the end of June 2021, that average price increased to $492,550. Units were selling for 104.5 percent of their list price. This was a big period of growth, as buyers who couldn’t purchase a detached house flooded into the condo market. However, this insane condo apartment market is finally slowing down a bit. Fewer units are being sold, condos are staying on the market longer, and most units are no longer selling for over list price. This puts buyers in a better place for negotiating as they feel more confident in the market. Sellers need to be careful about their asking prices moving forward.
However, this summer market update shows that the condo townhouse market is still going strong. Units are continuing to sell above asking price, and are staying on the market for a shorter time. Condo townhouses have some benefits over condo apartments that could be giving them more of a selling advantage. They generally have more space, are more pet-friendly, and have lower maintenance costs.
As for detached houses? Prices are still increasing, but more slowly. The current average price of a detached house is around $831,000. This is an increase from three months ago, when the average sat near $829,000. However, these gains are much smaller than those from six months and one year ago, when the average prices were $805,000 and $635,000 respectively. As you can see, the end of the summer market update shows price increases are slowing down. You can also examine this graphic from the Barrie & District Association of Realtors, which shows a 12.4 percent decrease in the number of detached homes sold from June 2020 to June 2021.
If you plan to buy
Buyers will be happy to know housing prices aren’t rising quite so quickly anymore, but the fact is, they are still going up. Much of Canada is experiencing these conditions, not just Barrie, so Barrie is not disproportionately affected. In fact, buying conditions are likely better now than they were six months ago. This might be a good time to buy, but you should still prepare for high prices and some competition. We probably won’t see housing prices return to pre-COVID levels, so buyers will have to accept a higher average selling price.
If you plan to sell
In general, the summer market update has shown we’re still in a seller’s market. However, it’s important to not rely on this too much if you plan on selling your home. The Canadian Real Estate Association has noted a slowdown in the market. This means we can expect to see a decrease in bidding wars. This is as a result of vaccinations, reopenings, and general economic recovery. Selling now is still a good bet, because supply hasn’t caught up with demand yet. However, since interest has declined a bit, you should know it might take longer to sell now than it would have six months ago.
Current homeowner options
If you don’t plan on moving, you might still benefit from a refinance! Here are some questions you can ask yourself if you’re considering a refinance. This move heavily depends on your financial situation, current rates, and future plans for your home. It’s important to consult a broker before taking any action to ensure you have the best plan going forward!
There’s a lot going on in the real estate market. With constant fluctuations in housing prices, supply, and demand, it’s easy to feel a little lost. The biggest takeaway here is to evaluate your own situation and goals, and to contact a mortgage professional before taking action. Everyone’s experience in this market is different, and brokers specialize in helping you find the best plan for your needs.
If you have any questions about this summer market update here in Barrie, or want to get involved in the market, I’m ready to help. Get in touch with me here!