Thursday, March 24, 2016

It's a Sellers Market Out There !

Well folks, here we are approaching Easter weekend and the market is insane.  Buyers are fighting to win their Dream Home in multiples almost every night of the week.  Many people think that this is only happening in Toronto and I can tell you that is simply not true.  Durham Region real estate is a hot commodity right now.

Recently had on home in Ajax, 21 offers and sold almost 120K over asking.  Is
Welcome to Multiple Offers !
that unusual?   Not right now.  It seems to be becoming the norm.  But how far will it go?   We need inventory to balance this market out.   Yes, interest rates are low.  The demand is high but the supply just doesn't seem to be there.  A minute a home is listed, it seems to sell within a week or less.

Agents are waiving inspections and financing conditions just to WIN.   If you are the listing agent or the Seller, this is great times but if you are on the other side, it can be rather frustrating.   People ask me all the time, "will this continue?" and the trust to the question is, I simply don't know.   I don't see it slowing down any time soon.

We are getting buyers from Overseas, buyers from Toronto who can now sell their house there for $1M and move to Durham and buy for less money but not necessarily buy down in size.  It is driving our house prices through the roof.

I think the important thing to focus on here is know your market.  Buyers should have an agent from the market they are buying in.  It doesn't matter where you buy but make sure you agent knows the area, schools, market values, past sales, etc.

This is important.  Your agent when you are a Buyer is there to PROTECT your
interests.   Please keep this in mind as I see Buyers going to Open Houses now and thinking if they use the Listing Agent, they will get a deal... NEWS FLASH - there are no deals right now !!!   This is a strong market... Highest and Best Offer wins... but at least if you have your own Agent you know they are working in your best interests.

If they tell you, that's high enough - listen !   Don't buy with your emotions.  Listen to reason.   We have been doing this a long time.  

Back in 1989/1990 a similar market happened, interest rates were higher (12 to 14%) and home prices were much more reasonable but it corrected itself in a matter of weeks.   It took years for those homes to rally back to the prices Buyers paid for them.

I am not trying to scare anyone out of buying real estate.  It is your biggest and best investment.  I am just trying to educate both Buyers and Sellers.  If you are thinking of selling and are sitting on the fence, don't wait too long... you never know what can happen and if you are buying now, use an experience agent who knows your market you are buying.  Just because they are your family or a friend, that doesn't necessarily mean they know what works in that particular neighbourhood.

I can honestly say, from what I have seen lately, the offer price needs to be at least 5 to 10K for each offer over asking FIRM to win.   So it depends on how many offers and which neighbourhood and price point you are buying in.

The good news is ... we have a healthy real estate market right now which is good for the economy.   Good luck in your home search and play your poker hand right.  Keep your cards close to your chest.  Share your numbers with your agent so you can strategize together the best way to attack the situation and come out on the winning side.  

Have a wonderful holiday weekend everyone and happy house hunting !!! 
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