It’s time for our summer market update here in Barrie. Like much of the country, Barrie has seen some changes in its real estate market over the past few months. 2022 has been a year of shifting housing trends for buyers, sellers, and homeowners. If you have questions about what’s going on today, you’re likely not alone. Here are some things to know about Barrie’s housing market right now!
Interest rates
Since the start of the year, we have seen three interest rate increases from the Bank of Canada. The overnight rate now sits at 1.5 per cent, which of course is a big rise from the 0.25 per cent we had gotten used to during the pandemic. As a result, interest rates have increased for mortgages. Buyers entering the market now will experience higher starting rates than they may have encountered one year ago. The goal of these rate increases is to cool down the housing market and bring inflation down. So, has the bank accomplished this?
Supply and demand
Since rate hikes began in Canada, the housing market has shown definite signs of cooling. At its height, housing markets in Barrie and across the country were sky-high. There was almost no supply, and prices went through the roof of the few homes that were for sale. Now, the data is showing a big boost in supply. According to Zolo, there have been over 1,000 new listings in the Barrie area over the past four weeks, with 206 homes sold. This shows a definite increase in supply. Homes are also spending a bit more time on the market with an average of 13 days, an increase from the eight day average we saw one year ago. This shows demand is a bit lower and there’s less urgency in the market, while supply is increasing. Buyers could be experiencing a better market this year than they have since before the pandemic.
Prices
Prices in the Barrie housing market are decreasing. Now, it’s important to remember how high prices reached, meaning even though they may be lowering now, they are still quite inflated. According to Zolo, the average sold price of a home across all housing types is currently $872K. This is a two per cent monthly decrease, and an 8.9 per cent quarterly decrease. Year over year, however, this is still a 17 per cent increase compared to prices at this point last year. As the market continues to settle, we are likely to see this gap start to close. To break things down further, the average price of a detached home is $956K, a townhome is $723K, and a condo is $598K. All of these numbers show decreases from the price stats of three months ago.
Is it a good time to refinance?
During the height of the pandemic, many people were eager to refinance to secure a lower interest rate. Now that rates are on the rise and most people are expecting more hikes from the Bank of Canada, does it still make sense to refinance? The decision to refinance shouldn’t depend on rates alone, even if they have a fairly large impact. If you’re in a position where your current terms aren’t working for you anymore, it may be a good time to discuss a refinance with a mortgage professional. Maybe you want to shorten your amortization period, or refinance to access equity to take on home renovations, both of which are perfectly good reasons to refinance. In many cases, borrowers can still refinance to a lower rate too. It’s worth checking in with your broker to see how this move might affect you right now.
Looking to buy or sell?
If you’re hoping to buy a home this summer, or within the next few months, it’s likely the market will continue to cool and prices will decrease. Supply may also keep rising, giving you more options. While it’s good that extra supply means less competition and lower prices, keep in mind interest rate hikes will affect your mortgage. It will be a bit pricier to borrow money and get a mortgage approval, and you will be looking at higher rates and monthly payments. Talk with your broker to determine what is achievable for you in this market before you proceed.
If you want to sell your home, you might be worrying it will suddenly be impossible to do so with the influx of supply we are seeing. Odds are, you will still be able to sell your home for a good price, even if it’s not as high as it would have been one year ago. It’s important to price your home wisely, which is when a real estate agent comes in handy. You should also expect to spend a bit more time with your home on the market. If you have a professional on your side to help you list your home and prepare it for selling, you will still have a good chance of selling your home at a price you’re satisfied with.
Hopefully this summer market update can shine some light on what’s happening in the Barrie housing market right now. If you have questions about how these trends might affect you, I encourage you to reach out to a mortgage professional. We can help you understand your current position, and what actions, if any, you should take in today’s market.
If you want to get started on buying a home or updating your mortgage, get in touch with me!