Are you curious about the current real estate market temperature? Is it still a seller’s market or has it shifted to a buyers market?
As an active real estate agent, I have observed that the market has cooled down. However, it has not quite shifted to the buyer’s market just yet.
It is likely that we will see the market to be healthier and more balanced in 2019. We can expect an increase in the month’s supply within the next 4 to 6 months. Currently, the month’s supply is up by +16.1% YOY at 2.1. Homes in good neighborhood showed well with most homes receiving multiple offers. This isn’t the case for homes in less desirable neighborhood where listings stay longer in the market.
Sellers are still hopeful for their ideal price but were forced to reduce to respond to less demand and less competitive market. Not to forget that in the month of November we had an unfortunate fire in the north that brought the smoke into the city. This caused hazardous air quality thus deterred people to get out and visit homes.
Secondly, Thanksgiving is shortly after the smoke, people travelled and have one out of town.
I would be curious to see December stats. As a result of November’s data, the December stats are likely to show some slow down. That’s enough with my own observation, let’s take a look at the data.
Key Indicators in November
Median Sale Price
Median Sale Price for single-family home and condo decreased 3.5% and 3%, respectively.
The Median Sale Price is a key indicator to show where the market is heading.
November is the first month in 2018 that showed home and condo’s median sale price are down. We do not know if the downward trend will continue for 2019. This could be just the winter effect as less buyers are out hunting homes. However, we have to go with the data and wait to see what will happen in early 2019 to have a better image of the real estate market.
Month’s Supply
Month’s supply increased to 2.1 for single-family home.
It is still indicating that we are in the seller’s market as the month’s supply is still low. In a normal and balanced market, we should expect to see month’s supply to be up in the range of 4-6.
Active Listings
Active Listings increased to 387 listings up from 334.
This means that compared year over year there are more listings on the market . Since the beginning of spring 2018, the percent increase of active listings are quite consistent.
The impact of having more number of active listings would be the increase on number of days on market. Subsequently, the average listings will be on the market few more days (in some cases, weeks) before they get under contract.
All these indicators point out that the market has softened up. Would this trend continue in 2019? We don’t know yet. I think the more accurate trend will be clearer after Feb/Mar 2019 stats. However, this report is reason enough for buyers (who have been waiting on a sideline) to start thinking about getting into the market again. For sellers who have been thinking about moving closer to family, for jobs, or just simply downsize, there may be a small urgency to start putting their plans together.
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