Get to know the Ontario Real Estate Markets before contacting a REALTOR®
Having a REALTOR® help navigate buyers and sellers through the process of the real estate market in Ontario can alleviate stress and help point people in the right direction. Even though buyers and sellers may have a professional in their corner, it's always good to become familiar with what has recently sold and is currently for sale in the local real estate markets before contacting a REALTOR®.
Homeowners don't have to learn everything about current market conditions, but having a little knowledge about real estate isn't bad. To understand the local markets more, consider allowing extra time in your day to research.
Employment
Despite more and more people working from home, the fact remains that there are still those who go to work at an office or any other location that isn't their home. Typically people want to live near those places of work to save on commuting times and spend more time relaxing at the end of their work day. Understanding the local real estate market means understanding employment rates. Has there been a sudden increase in the employment rate? That could translate into more people coming into the area, creating demand. Conversely, if there is a drop in employment rates, more people may leave their homes for other employment opportunities.
Supply and Affordability
The next tip to understanding the real estate market is to know the supply. Be aware of how many properties are on the market, what type of properties are on the market, the average price, and how high and low prices in the area are reaching.
Finally, learn the affordability of the local market. Review property prices, the average household income, and interest rates to do that. Don't forget property tax as well. Locals can typically find that information after municipal census results are shared.
Real Estate Market Reports
A real estate market report is a general overview and measure of real estate prices. These reports will provide market trends in a given area. Many organizations provide market reports, so buyers and sellers should find the one that captures the region that interests them. For example, the Canada Mortgage and Housing Corporation (CMHC) offers up-to-date housing market reports and supply reports. However, if buyers and sellers want to be more hands-on, then reviewing the real estate section in their local papers to follow trends is a great way to be aware of what's happening in their area.
Heated and Cooling Ontario Real Estate Markets
Hot markets usually mean sellers can sell their property faster and often above the asking price. Heated demand occurs when there aren't a lot of properties for sale, but many buyers are looking in that area. Suppose sellers find themselves in a hot market. In that case, there are certain things to do to help the process even more expediently, specifically having all the documentation ready to go, so it doesn't hold up the closing. Sellers should also prepare to move out of their selling house quickly and not leave packing to the last minute.
A cold market happens when there are more homes for sale than there are buyers to buy. During this time, houses typically spend more time on the market before selling. Therefore, sellers listing their properties when the real estate market is cold should anticipate more negotiations from the buyers.
The terms hot market, cold market, and neutral market refer to a seller's market (that's a hot market) and a buyer's market (that's a cold market) and a balanced market (the perfect balance between hot and cold). During a hot market, the seller will typically have several buyers to negotiate with as the housing supply is lower. During a cold market, there are fewer buyers, meaning the seller may have to be prepared to deal more than they would have preferred.
Understanding the differences between a hot, cold, and balanced real estate market will help you decide about buying or selling your home.
