June, July and August were remarkably similar in terms of the real estate market and how historically yikes-worthy it was.
Record high listing inventory, sales dragging their feet and asking prices stubbornly high.
Here are the Top 5 Things To Know Right Now:
#1 – For Sale Signs:
August 2024 marked the fifth consecutive month to have record-high active listings. Late spring to early summer is typically an active time of year in terms of overall activity; however with weak sales, there is a significant portion of the available inventory that continues to languish on the market. The 10-year average for monthly active listings in the summer is typically in the 2,000 range. May through August 2024 averaged between 2,950 and 3,200 active listings per month, which was 54-58% higher than normal. What is causing this pile-up of “For Sale” signs? Keep reading to learn more...
#2 – Why So Many Listings:
With active listings in 2024 running at record highs, the question is: why? Here are a few quick facts: There are currently 3,044 homes actively for sale in Niagara. Of those, 1,036 (34%) are vacant. Those vacant homes are feeding the supply side, but not the demand side which further tips the imbalance we’ve been seeing. Also, the data clearly shows that there is a gap between asking prices and what is actually selling. For example, looking at detached homes in St.Catharines, under $1 million, the average asking price is $687,000 while the average sale price for sales over the last 30 days was $591,000.
#3 – Are Homes Selling:
While homes are selling, we’re still seeing monthly sales across Niagara lagging well behind normal. June through August 2024 produced 1,660 sales in Niagara. That is the second-lowest total, with 2022 holding down last place with 1,433 sales.
What do those two years have in common? The initial shock of the interest rate increases in 2022 froze the market while 2024 showed more of a resigned “wait and see what the BoC does” approach. On an annual basis, Niagara averages 7,500-7,800 sales. 2024 is likely going to settle very close to 2023 with just over 6,000 annual sales.
Demand will return. When? We shall see.
#4 – House Price Trends:
In a changing market, getting a handle on pricing can be elusive. If you look at the price trends for average, median, or HPI benchmark over the past 5 years, there is a very clear trend related to the impacts of COVID. After the explosion in pricing through 2020 and 2021, volatility has reigned supreme over the past 3 years. With available listings running 55% above normal while sales were 25-30% below, the fact that prices have maintained some semblance of order is remarkable. With a mild pullback in the past 60 days, we have seen the demand focus on the lower end of the market, which has pulled overall pricing metrics down. The balance of 2024 will be interesting.
#5 – Reasons for Positivity:
Real estate markets are like sandbars in a cottage-country lake. They change shape as the currents around them ebb and flow. Looking back over the past several years, we have seen a wide variety of markets. From the electric 2021 to the relatively placid 2012-2015 markets, one thing remains the same: Niagara is a highly desirable place to live and as part of the larger community of Southern Ontario, it will continue to be a jewel that draws a real estate crowd. So, while the current market may be confusing, it is temporary. After 2023 and 2024 post the lowest annual sales in modern times, we expect to see slow progress toward healthier market conditions as we head into 2025.
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Have questions?
The best path through a confusing market is found with the help of a highly skilled, full-time Realtor®. Whether you are looking to move this fall or just want to get your ducks in a row for a possible move in 2025, we are here to help anytime. Looking for a market value report for your home? Reach out, and we can take care of that for you when you’re ready. Thank you for reading. :)