I find it interesting to watch the stories about real estate in the news (reputable news sources, that is). I have noticed in my years working in this industry that sometimes a real estate related news story might capture a macro level ‘snapshot’ of what is happening in general that isn’t necessarily reflective of what is going on at the micro community level. That has never been truer than right now amidst CoVid19. Add to the already variable messages people ingest about real estate, and CoVid19 is creating a rapidly changing and organic environment within which consumers need to be more discerning about who they trust to interpret that messaging nationally, provincially, and at the community level.
Remember the real estate market of 2017? Remember how the market changed between April 30 of that year and May 10-14 when everyone flooded the market listing their home for sale after they saw how much their neighbours were getting for their properties? Within a two-week period, we saw multiple offers morph into a climate in which homes simply weren’t selling because suddenly supply was ubiquitous! We were telling our clients at that time that the normally 2- month period our Value Analyses were ‘good for’ had actually changed to two weeks. Yes, in a nutshell, we knew at that time that our market was so capricious that what we recommended our seller’s home was worth one week could conceivably be worth something significantly different two weeks later.
Enter CoVid19 and all of the new protocols we now adhere to as an essential service conducting business (mostly) from a distance to keep our clients and ourselves safe, and it is likely you want to know what is happening? If you think you might want or have to buy or sell in 2020, Please note that what I interpret and convey today in Durham on May 1 2020 may be different than what is happening in the middle of May. I qualify the following information is a snapshot of what is going on in Durham Region 7 weeks into our stay at home reality.
While the NUMBER of homes that have sold in Durham has decreased since Mar 12, 2020, there are four communities where this is NOT the case. These four areas have seen an increase in the number of homes sold over that seen since Mar 12 of 2019: The McLaughlin, Northglen, and Donevan communities of Oshawa, and the South West community of Ajax.
Take a look at this graph of the average sale prices in all of Durham Region (excluding Brock) with each year since 2016 depicted in a different colour:
The news story that you might hear based on a graph like this might sound something like this - ‘average sale prices plummet in Durham Region.’ If you didn’t have a Realtor that you know and trust and that knows how to break down the sales data at the micro level, you might hear this and think – ‘wow – that means I really shouldn’t sell this year.’ While that may be true if you live in 23 communities in Durham Region, it is NOT currently true if you live in the other 32.
If we look at the average sale prices in Durham since Mar 12 this year to April 25 compared to the same time period in 2019, there are 32 catchment communities (out of 55) in our Region that have seen an increase in average sale prices (excluding Brock). So, this essentially means that there has been an increase in averages sale prices in 58% of the catchments in Durham Region DURING A PANDEMIC compared to the same period of time in 2019. That may be a little bit of a surprise to some or many, but just like analyzing the course of a pandemic, data analytics are key to knowing what is going on in real time. The graph of average sale prices in Durham above with that downward purple line for 2020 looks dire! However, upon closer inspection, the micro data not so much. The other 23 catchment areas combined seem to be bringing the overall average of the other 32 down regionally but until we look at the percentage of the region experiencing a decrease in value, the graph is actually kind of deceiving.
The reality is that there may be many residents of our region that have to sell in 2020. The fact that the listing inventory has stalled may be acting as a bit of a buffer to keep values stable at least in the short term.
Here are those communities (and what percentage they have increased from Mar 12-April 25, 2020 over the same period compared to 2019). What community do you live in?
I’m no Theresa Tam or Anthony Fauci, but the message is simple – data alone is not enough – enlisting the expertise of a proficient interpreter of that data is just as critical whether it is to flatten the curve, or to prevent yourself from losing tens of thousands of dollars (or more) executing the most important financial transaction of your life. This is especially true amidst these uncertain times: choose your compass wisely.