2023. A look back at yet another entertaining year.
Sure, the concept of what qualifies as entertaining is fully subjective, but no matter how you slice it, 2023 kept the streak of wacky, roller-coaster years alive. It’s hard to believe that 2023 was the 4th year since COVID and all that it introduced to our lives, the least of which was a real estate market that bordered on illogical.
2020 was “shock & awe” followed by a hyperactive spring market that took place in the fall and winter. Half of the population was hiding in their recroom in their jam-jam pants while the other half were moving.
2021 was a record year, with activity reaching levels we may never see again. It was a year where Realtors exceeded their annual kilometer allowance on their car lease before labour day. Time was a blur, and we did our best to control the daily chaos.
2022 was a whiplash year. It started out at a blistering pace with prices and decision making at a level of mayhem unlike anything we had seen. Asking price $799,900? Sure, let’s give them $950,000. It was wild until it wasn’t. Rate hikes kicked the door down on the party and everyone scattered.
2023 started out bruised from the end of the previous year, but optimism started to show up. We moved into spring with a “hey, we might be ok afterall!” feeling. And then the Bank of Canada showed up and said, “not so fast…”. Rate hikes sent the optimistic few running for the hills.
The reality is 2023 is going to set some dubious records.
- The first year with a negative average sale price year over year since the Blue Jays won the World Series? Check.
- The lowest (or very close to the lowest) annual sales on record this millennium? Check.
- Highest number of active listings since 2014? Check.
But there is another way to look at those market factoids…
- Early 2022 was so lopsided that the first 4- or 5-months average sale price was $850,000 +/- while the last 6 or 7 months of the year was around $700,000. So, maybe 2023 wasn’t so bad afterall?
- Annual sales were at record lows but all things considered, not that far off what was normal before the market chaos we’ve had in recent years.
- All those active listings mean there are a lot of people out there who are trying to transact in this market. How many of those active listings are sellers who would also be willing buyers if the market freed them up to do so?
All things considered, you could argue that the market showed resilience in the face of increasing interest rates and decreasing consumer confidence.
And finally, 2024...
What happens to that consumer confidence once rates start to decrease? Everyone has theories and opinions with regards to the future market. We’ve heard everything from rates decreasing in May or the summer or by end of the year. Prices stagnant, or up 5.5% or who really knows.
The fact is that no one knows. But here is our theory. The market can only drag along for so long. In fact, it is already showing small degrees of recovery (sales have improved in comparison to the 10-yr average for example).
We're looking at 2024 as a year where we might, just might, be pleasantly surprised.
If you or someone you know is contemplating a move or sale in 2024, it’s going to be a year of change and as things change, timely insight and skill will be more necessary than ever.
We’re here and ready to help anytime.