Normally this blog post is my market update for the previous month, and I will touch on February results in this update shortly. However, I have had a lot of questions from clients about how the coronavirus crisis is going to affect our local real estate market. With any investment it is common to have concerns with the situation our current global economy is facing, however, real estate being one of our largest investments brings much more concerns. Although, real estate and bonds are some of the safest investments, at this time of crisis, uncertainty is the only certainty.
I believe that we are going to experience temporary, but significant impacts. The fear of infection is affecting consumers behaviours, and this was evident with the onslaught of panic purchases and hoarding that was witnessed in grocery stores everywhere the last few days. There is also extreme fear of uncertainty and volatility in the stock market with is also affecting consumer behaviours.
We are seeing historical lows on interest rates, and there are pros and cons to these rate reductions. Those with variable rate mortgages will see their interest rates fall by 0.5%, which means more of your monthly payment will now go towards your principal rather than interest. That’s good news as you’ll now pay off your mortgage in a shorter time.
However, housing prices could rise as interest rates are inextricably linked with real estate costs as it will increase buyers purchasing power. (If your borrowing rate is lower today than it was yesterday then you can now buy more house with the same amount of money.) So many people are worried about how these rate cuts will impact an already overheated real estate market.
There are ways you can respond to the coronavirus crisis as a home buyer or seller. If you are sick, quarantined, have travelled internationally of late, or if there is a possibility of COVID-19 exposure – stay home. This is an obvious one but it does need to be said. Sometimes people think, “I’m fine” but during such a crisis, there should never be a ‘roll the dice’ attitude. Take the time to ensure you are educated on whether or not you could be at risk, and follow these basic guidelines – for your health and for the health of others around you. With real estate we are seeing open house cancellations and in person showing reductions. As your realtor, I can assist you with virtual tours or video tours in order to be able to have that viewing without risking your or your family health by leaving home.
Now, we need to take a quick look at how February fared in light of the co-vid crisis. Listing activity, sales activity, and prices continued to increase as the real estate market gathered momentum into latter part of winter in Wellington County.
The year-over-year sales volume year is up by 35.71% over 2019 numbers, where 2020 sales volume rose to $297M at end of last month over February 2019 YTD sales volume of $219M. The unit sales were up to 488 for the county which is 24.17% over February 2019 YTD numbers of 393.
Click here for Market review video for end of February 2020 in Wellington County.
February’s unit sales were up 35.19% compared to previous months sales, with 292 units sold, over February 2019’s unit sales of 216. Further, with 372 new listings up 10.06%, and a 78.49% sales/listing ratio up 14.59%, the market was rocking the month.
The year-over-year median sales price at end of February 2020 is up 11.26% over 2019 numbers. It rose from $490,225 in February 2019 to $545,423 at close of February 2020 for Wellington County. And year-to-date average sales price continued that trend increasing 9.1% over 2019 resulting in an average sales price of $605,055 at end of February 2020 vs. $554,590 just a year ago.
During 2019, we saw a trend of homes staying on the market slightly longer than the previous year, however, with average days on market at 28.5 days at end of February 2020 versus 38 days at February 2019, looks like homes are still moving a bit quicker on the market as we ramp up into this Spring.
The first couple months of 2020 has been a healthy robust start for the real estate market and the average year to date sales prices in Wellington county are listed below for each type freehold vs. condominium:
Freehold Homes: $665,825 (Average sales price at end of Feb 2020)
Condominium homes: $443,111 (Average sales price at end of Feb 2020)
Vacant land sales: $442,261 (Average sales price at end of Feb 2020)
Like the proverb says March comes “In like a lion, out like a lamb”, with us going into the month in winter and by the end has cleared up. Hoping that the same holds true with this coronavirus crisis and it has cleared up by the end of this month as well.
Keep healthy and stay safe!
If you’re considering a move, or purchasing a home in the Guelph area, let’s chat! You can reach me at 519-824-9050 ext. 235 or email me.
Alternatively, you can connect with me here for more information or click here to view detailed market reports for each of the areas in Wellington County.
CONNECT WITH FRANCES:
Frances Snider is a Guelph based real estate agent that is committed to providing ongoing value & service to her clients. She focuses on nurturing lifelong relationships built on a foundation of experience, market knowledge and trust.