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    « Bronte Creek – August 7th Unveiling of Monarch Homes | Main | New Development in North Oakville at Neyagawa – Rosehaven and Starlane Homes »
    Monday
    Jul192010

    Why Buying in Oakville this Summer is a Good Idea

    Is there a “best” time of year to buy a home?  I’ve looked at the numbers every way imaginable and I can’t find a correlation between seasonality and housing opportunities.  I do however think that now is a good time to buy a home.  I say this after close examination of market trends, economic conditions and of course my own expert advice.  Here is my rationale...

    Market Trends:

    Many of us rely on the media to decide how the market is doing but often by the time the stats are published, the market has already shifted.  If you look at housing prices in 2009, prices rose a whooping 12% in January from their December 2008 lows.  By April, prices were up 20%.  In other words, a $500,000 home in December ‘08 was worth $560,000 a month later and $600,000 four months later.  If you waited for the media frenzy to start reporting on “a recovery in the market” as they did in the spring of ’09, you would have missed out on a $100,000 opportunity. 

    I say this really to illustrate one point and that is that the best time to buy isn’t necessarily after the media starts reporting on it.  It is kind of like saying the best time to buy a stock is when CNBC recommends a stock pick on national television. 

    If we look at market trends, we can however surmise a few things.  First let’s look at “days on market” (the average number of days it takes to sell a home).  In Oakville, “Days on market” has been on the rise for the past four months.  Last month alone, it jumped from 26 to 33 days.  Generally when prices fall, the length of time to sell a home increases.  This has somewhat of a lag effect as it takes a while for sellers and buyers to realize that the demand has dropped.  Prices were still near record highs in June so if my interpretation of the inverse relationship between days on market and price hold true, we should start to see prices drop slightly in July. 

    Economic Conditions:

    The GTA has managed to weather the global economic downturn quite well.  Canada’s banking industry remains one of the strongest in the world and manufacturing is on the rebound.  While the job market remains fairly stable, a recent consumer confidence report showed that Canadian’s confidence about the future strength of the economy slipped last month from a months’ long upward swing.  This makes sense given the economic uncertainty in Europe as well as the negative sentiment regarding the introduction of the HST. 

    The recent year-long upswing in the housing market also makes sense.  Reports on Canada’s economy outpacing other developed countries, Canada’s extremely strong banking industry, record low interest rates and of course, the huge upswing in the housing market all helped fuel this growth. 

    Sentiments such as these don’t last forever so it makes sense to me that consumer sentiment should shift back towards a more neutral state.  As consumers become more realistic with future growth opportunities, the real estate market will follow suit which is why I expect a more balanced (ie: neither a buyers nor sellers market) over the short to medium term.  This is a shift from the recent sellers market which has caused such a sharp rise in prices.

    Expert Advice (aka my observations as an Oakville Realtor):

    I am extremely active in the real estate industry in Oakville, particularly on the buying side.  In addition to my interpretation of market trends and economic conditions, everything I see on a daily basis working with my clients leads me to believe that now is a pretty good time to buy. 

    First off, buying now allows you to beat out other buyers who will inevitably wait until the fall.  In the summer, people would much rather be on vacation than stuck in Oakville shopping for a home.  The number of viewings on homes right now is much lower than it was a month or two ago.  Now is the time to look without feeling rushed.  There are absolute gems out on the market right now.  With fewer people walking through these homes, YOU have a better chance of picking one up.

    Interest rates should not be ignored.  Record low 90 day rate holds encouraged many people to buy this spring.  Most of these rate holds expired this past June/July, easing some of the pressure off the market.  Less pressure means less demand, means more negotiating power for buyers which in turn makes it a good time to buy.  While higher than their record lows of a few months ago, interest rates are still at reasonably low levels.  If you think the rates will rise slowly in the coming months, buying now could be a great investment (Studying the relationship between interest rates and housing prices is a topic I will leave for another day).

    With lowered demand this summer, buyers have more time to think over their decisions and are less likely to be faced with a bidding war.  This is something I find particularly attractive to clients who are first time buyers who may want more time and space to think over such a large decision.

    Bottom Line:

    My interpretation of market trends, economic conditions and industry observation all lead me to believe that now is a good time to buy.  When you actively work in the Oakville housing industry as I do, you can physically feel the shift in buyer and seller sentiment before market statistics come out.  One day, there are bidding wars for everything my clients’ want to see and the next we really do have the flexibility to negotiate.  Understanding the nuances of the shifts in the market and when they are going to happen can end up saving you thousands of dollars which is why I encourage anyone thinking of buying or selling to engage a realtor before making a decision.  If you are thinking of buying a home and would like to chat further on the subject, I would love to hear from you.  I can be reached at lindsay@remaxaboutowne.com or 905.484.5162.

    Regards,
    Lindsay

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    Reader Comments (2)

    Any update about the Mattmay north oakville project? Please let us know if you know anything.
    thanks

    June 9, 2011 | Unregistered CommenterJAY

    Hi Jay,

    I haven't heard anything lately regarding Mattamy's development in North Oakville but I am keeping my eyes and ears peeled for information. I will post something when I do have more information. In the meantime if there is anyone reading this who has information on the timing of any North Oakville development, I would love to hear from you. I can be reached at 905.484.5162 or emailed at lindsay@remaxaboutowne.com.

    Regards,
    Lindsay

    June 13, 2011 | Registered CommenterLindsay Walls

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