Why This Summer is the 2020 Real Estate Season - June 11, 2020
Ian Walterhouse
Thursday, June 11, 2020
Why This Summer is the 2020 Real Estate Season
With stay-at-home orders starting to gradually lift throughout parts of the country, data indicates homebuyers are jumping back into the market. After many families put their plans on hold due to the COVID-19 pandemic, what we once called the busy spring real estate season is shifting into the summer. In 2020, summer is the new spring for real estate. While numbers are not yet available in Canada, Joel Kan, Economist at The Mortgage Bankers Association (MBA) in the United States notes:
“Applications for home purchases continue to recover from April’s sizable drop and have now increased for five consecutive weeks...which is an encouraging turnaround after the weakness seen over the past two months.”
The Government of Canada’s mortgage loans report for the Bank of Canada shows that quarter over quarter since Q1 2019 shows that the total number of mortgages continues to increase.Additionally, according to Google Trends which scores search terms online, searches for real estate in Canada increased from 57 points the week of March 15th to 100 points last week. As we can see, more potential homebuyers are looking for homes virtually.
What’s the Opportunity for Buyers?
Another reason buyers are coming back to the market, even with forced unemployment and stay-at-home orders, is historically low mortgage rates. Canada’s key lending rate is currently at 0.25% following the 150 basis points in interest rates cuts the Bank delivered in March. In his final press conference in late May, before stepping down as Bank of Canada Governor, Stephen Poloz said,
“I’m relatively optimistic….compared with what the talk is.” He suggested rates will remain historically low for the foreseeable future by indicating that: “We are in an era where interest rates are probably going to stay low, for demographic reasons and economic growth reasons.”
With mortgage rates at such low levels and states gradually beginning to reopen, there’s more incentive than ever to buy a home this summer. What’s the Opportunity for Sellers?Finding a home to buy however, is still a challenge as this spring sellers removed many listings from the market. Though more people are now putting their houses up for sale this month as compared to last month, current inventory is still well below last year’s level.
According to recent statistics from the Toronto Real Estate Board, the monthly inventory showed growth from April 2020 to May 2020 by 68%. However, the inventory is currently sitting at 50% of the May 2019 inventory numbers.
If you’re thinking of selling your house this summer, now maybe your best opportunity. WIth so few homes on the market for buyers to purchase, this season may be the time for your house to stand out from the crowd. Trusted real estate professionals can help you list safely and effectively, keeping your family’s needs top of mind. Buyers are looking, and your house may be at the top of their list.
Bottom Line
If you’re thinking of selling, many buyers may be eager to find a home just like yours. Let’s connect today to make sure you can get your house in on the action this summer. Give one of our experts a call at 416-522-1112.
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