I woke up to frost in the backyard this morning.
Despite having grown up in northern Ontario, I really dislike winter and any sign that it’s just around the corner depresses me. That said, it’s a good reminder that the craziness of the fall real estate market has started to slow down and that’s good news for Buyers. If you’ve been intimidated by the bidding war madness of the past few months, take heart: November and December can be some of the best months to be a Buyer. Here’s why:
1. For the first time in a long time, there’s inventory. From nicely renovated houses to authentic loft conversions to well-priced condos, there’s a decent selection out there for Buyers. While Sellers still control the market, at least there are options for Buyers and everyone isn’t converging on that one house for sale. Good houses are still getting multiple offers, but we’re seeing 2-3 people at the negotiating table instead of 10 or 12. (Case in point: 96 of 196 houses sold in the downtown core in October sold over-asking; but the median sold price as a percentage of asking price was 100%.)
2. Buyers get distracted at this time of year, and that means less competition. And no, I’m not talking about the distractions caused by our drug-addled buffoon of a mayor. Late fall market Buyers tend to take more time to make a decision and there’s nothing like a cold day to keep everyone home from an open house. November can mean finding the house of your dreams because everyone else stayed home. Yippee!
3. Prices. The fall market continued to see prices increasing, but November and December tend to be calmer months. With more properties to choose from and fewer motivated Buyers, there may be opportunities to negotiate. Sellers who didn’t successfully sell in the prime autumn market months may be more than happy to negotiate in order to sell their property before winter settles in.
4. Interest rates are still nice and low. Contrary to what some of us expected, interest rates continue to be extremely low. A client of ours got a 2.65% variable rate mortgage just last week. Low interest rates mean you can buy more property for your money (or spend less, of course). For example: just a few years ago, we locked in the mortgage on our house at 3.99% (the rates really seemed phenomenal at the time, but yea, I’m kind of embarrassed about it now). The difference between payments on a $300,000 at 3.99% and one at 2.65% is $210 a month. Ouch.
So is now the right time for you to buy? Deciding when to buy isn’t just about knowing what’s happening in the market and in the economy…it’s a personal financial and lifestyle choice. Not sure what to do? As always, we’d be happy to help you work through the pros and cons of buying now vs waiting.