So here we are! One week into the changes to the stress test. Has it all come crashing down? Let's take a look at the stats and check it out for ourselves!
In the month of June so far we have seen the number of sales increase 137.25% and the number of active listings increases 11.20% from the same time in June last year.
Prices have also increased with the median increasing 2.87% and the average price increasing 6.07%.
A couple of different factors that were in place in June of last year include:
Lower stress test and interest rates
In the middle of the pandemic without any plans of reopening
Mortgage deferrals were still in place
The market was still recovering from the March and April complete shutdown
Compared to now, where we have:
Significant declines in inventory and purchasing at recent highs
Higher stress test and interest rates
Job creation in industries outside of oil and gas
Stage 1 reopening with Stage 2 planned shortly.
A significant amount of changes have happened in a year in our real estate market, but the question remains, should we expect to see this trend continue. As we get into the summer months, my goal will be to keep you informed about how things shape up.
But for now, let's focus on how June is doing.
If we were to do a very simple forecast based on the average number of sales and new listings in June 2021, we would have the following anticipated numbers for the month:
Sales will decline to 2,651 sales, which is an 11.3% drop in sales.
New listings will decline to 4,143 listings, which is a 9.22% drop.
If these predictions were to hold true, we should expect the price to remain steady. However, as we get further into June we have the following factors on the market to consider.
Reopening to stage 2
Lower infection numbers
Seasonality of the market
Even though our market has been a wild one this year, it does still follow the seasonal trends we have in our market. Namely, into the summer months, we do normally see a declining amount of inventory due to people out and about enjoying the weather and not placing their homes for sale. We should continue to see this trend if not more so with reopenings this summer.
Sales will continue to surge, but only at a pace that is allowed by inventory levels. If the same buyers are interested in the same listings, and those same listings aren't coming to the market fast enough, the sales side will suffer as those buyers will be forced to wait or purchase another type of home, like a townhouse, or apartment.
With Stage 2 reopening upon us, we as realtors will be allowed to start holding open houses once again, which will allow us to market properties faster and for some of us that leverage a coming soon program, we can potentially sell the property prior to it hitting the MLS market. I would expect to see sales continue to happen but not be 100% reports on the MLS.
Finally, the last part to consider is how the rest of the country is playing out. Sales are continuing to happen in the bigger, more expensive markets, with little evidence of slowing down. We should expect the same to happen here as our pricing is still one of the most competitive price points in the country. And now with being one of the first provinces to reopen, more job growth, we can expect the month to shape up and continue to perform like the previous months, if not better.
In summary, June looks to be a month that still has a few questions about its performance in the area. Hopefully in two weeks we can take a look once again and gain an better understanding of where things sit in our market.
If you are a buyer or seller, feel free to reach to me at any time to chat about the market or to learn about your options. My email is email@example.com
Take care, talk soon!