Since the start of the pandemic, the media has focused on two main events: COVID-19 and house prices.
So much in the housing market has changed over the past few years.
In the Hamilton area, we have experienced the most dynamic real estate market ever – driven primarily by basic economic theory of ‘supply and demand’.
The question to which Judy Marsales Real Estate Ltd. Brokerage is often confronted with is: “Why is there such a lack of supply? »
Although there is no simple answer, it is necessary to examine some of the basic factors affecting the market:
- Lowest mortgage interest rates in history.
- At the start of the pandemic, the Bank of Canada lowered the key interest rate to protect the economy, which helped reduce borrowing costs for variable rate mortgages.
- A demographic shift is underway.
- CMHC has identified that for the first time, ‘millennials’ outnumber the former dominant demographic group, ‘baby boomers’. However, boomers are less likely to downsize than any previous generation. Instead, they choose to “age in place”.
- Extreme increases in housing values in nearby cities like Toronto.
- The concept for young shoppers in these hot markets has turned into a “drive until you can afford to buy” mentality that has driven people away from Toronto’s high prices.
All of this has created a “Log Jam” market in that a homeowner cannot sell their home unless there is another place to move to.
For some buyers, this can be frustrating. They have this wonderful opportunity to benefit from the incredible increase in the value of their home while having fewer options to buy back on the market.
This is the time when one should review all their options in the future. For example, it is healthy to stay at home as you age, provided you have the support systems in place to enable a comfortable life.
Do you plan to share your home with other family members? Do you prefer to sell and rent as the market adjusts? So many questions!
All of these questions indicate that this is also the time when buyers and sellers need the best advice available. If you are considering making a change you may want to speak to your lawyer, accountant and real estate office.
Judy Marsales Real Estate Ltd. Brokerage can provide you with a free “value opinion” for your home so you can make smart plans.
Keep in mind that the market can change quickly, so you always want to have a “backup plan” in place, whether you’re looking for a home or considering selling. Judy Marsales Real Estate Ltd. Brokerage is there to provide the latest information – call, text or email. They are ready to help you make the best decisions in today’s fast-paced housing market.
Stay healthy, stay organized and enjoy life.