Can you imagine a financial advisor getting you into an investment — say, a mutual fund — and telling you not to ask about it, or even check on its performance, for the next five years? You would likely balk at such a suggestion and insist that you’d be able to review your investment at least once a year, or even more frequently.
Now, I’m not a financial advisor, I’m a real estate agent. Yet, the same principles apply when owning a home. You don’t want to have five years go by — or even one year — without checking in on your “investment” and seeing how it’s doing for you.
Indeed, it’s important to regularly ask questions like:
- “Is our home still meeting our needs?”
- “What is the current market value of our property?”
- “Does our property and neighbourhood still fit well with the lifestyle we want?”
- “What kind of new home do we qualify for?”
Getting answers to those questions is crucial to managing what may be your most valuable investment: your home.
How often should you do this? I recommend a review once a year.
And, the good news is, you don’t need to go through this process on your own. I can help. When it’s time to review your property investment, give me a call. I can give you the answers and advice you need using the latest market data and information.
As I’m sure you’re aware, The Bank of Canada held rates last week. Rather than focusing on this I’d rather let you know what I am seeing out in the field. As always, folks still need to buy and folks still need to sell. The market is still active out there so I’m seeing some of my buyers get really good deals on properties even with multiple offers! I was successful in an 8 offer situation without having to go astronomically over the asking price like we’ve seen in the past. In fact, buyers of mine were even able to win a multiple offer situation and were still $47,0000 below asking. There still isn’t a ton of inventory so supply issues remain. One the selling side it’s evident that homes priced where they should be are still moving. That being said, I am definitely noticing that any properties listed too high are sitting on the makret. They are not receiving any offers even if they are still getting the odd showing booked. An effective listing strategy and list price are as important as ever.
I wanted to end off by saying that I hope you had a fantastic summer and wish you all the best as we head into the Fall season!
The Numbers Are In (August 2023)
Real Estate Market Stalls in August, Supply Challenges Persist
Members of the Ottawa Real Estate Board (OREB) sold 1,196 residential properties in August through the Board’s Multiple Listing Service® (MLS®) System, compared with 1,130 in August 2022, an increase of 6%. August’s sales included 903 in the freehold-property class, up 7% from a year ago, and 293 in the condominium-property category, a 2% increase from August 2022. The five-year average for total unit sales in August is 1,525.
“Sales activity was up marginally on a year-over-year basis in August but remained well below the historical average for this time of year,” says Ken Dekker, OREB President. “There is no shortage of demand given increased immigration and the large Canadian population cohort entering the market. The lack of suitable, affordable housing is a hindrance. High borrowing costs and economic uncertainty are impacting both sellers and buyers, which we expect will continue to result in further market fluctuations.”
Janice Myers, OREB CEO, highlights that these latest figures coincide with the City of Ottawa’s allocation of $110 million for affordable housing. “Even if interest rates were to drop and the economy stabilized, housing will remain out of reach for many Ottawa residents. Collaboration among all levels of government and stakeholders is vital to improving affordability for homeowners and tenants alike. And we need to expand provincial regulations, allowing four or more residential dwelling units on serviced lots, to promote higher-density housing.”
By the Numbers
- The average sale price for a freehold-class property in August was $709,739, an increase of 0.5% from 2022, and a 5.6% decrease over July 2023 prices.
- The average sale price for a condominium-class property was $425,968 an increase of 1% from a year ago, although 1.4% lower than July 2023 prices.
- With year-to-date average sale prices at $732,220 for freeholds and $432,571 for condos, these values represent an 8% decrease over 2022 for freehold-class properties and a 5.5% decrease for condominium-class properties.
Inventory & New Listings:
- August’s new listings (2,228) increased 7% over August 2022 (2,090) and were on par with last month (2,234). The 5-year average for new listings in August is 2,177.
- Months of Inventory for the freehold-class properties has increased to 3 months from 2.9 months in August 2022 and 2.7 months in July 2023.
- Months of Inventory for condominium-class properties remains on par with August 2022 at 2.2 months, a slight decrease from 2.3 months in July 2023.
- Days on market (DOM) for freeholds have increased to 31 days from 25 days in August 2022 and 26 days in July 2023.
- Days on market (DOM) for condos have increased to 29 days from 28 days in August 2022 and 28 days in July 2023.
* Ottawa Real Estate Board
How to Decide if a Neighbourhood is Right for You
Say you’ve found a house for sale in an area that’s unfamiliar to you. How do you figure out if it’s going to be the ideal neighbourhood?
|The first step is to take a walk. Stroll the neighbourhood and explore. If you get the chance, chat with homeowners and get their opinions of the area. Ask what they love about it. Also ask what they don’t like.
Next, determine how the neighbourhood is going to fit with your lifestyle. You’ll want to consider things like commuting routes, local amenities, schools, parks, shopping, etc. Google Maps is a great tool for this. Just turn on the satellite view and get a bird’s eye view of the area and its features.
Finally, get the latest data on neighbourhood characteristics such as noise, demographics, crime rates, and more. You’ll be surprised by how much data is available, and the valuable insights you can gain about what it’s going to be like to live there.
If the neighbourhood turns out to be a good fit, consider making an offer on that house!
When a Buyer Makes an Offer, What Happens Next?
Imagine you’re selling your home and an offer from a buyer comes in. You’re excited. Your home might soon be sold!
What happens next?
Typically, we will review the offer together. There will likely be several things about the offer that need to be carefully considered. The most common are:
- The offer price.
- Evidence the buyer is financially able to purchase the property.
- Conditions on the offer, if any.
If the offer price is far less than you anticipated, there might be an opportunity to counter-offer at a higher price. This is part of the art of negotiation, which is an important step in selling your home successfully.
The buyer’s ability to afford your property is also important. Ideally, you’ll want to see a Pre-Arranged Mortgage Certificate from the buyer’s lender, or some other evidence that there won’t be any financial problems closing the transaction. The amount of the deposit is also key.
Finally, you’ll want to look at conditions. The most popular condition requires that your property pass a home inspection, but there may be others. Obviously, an offer with no conditions is ideal.
Considering Contractor Factors
At some point, every home needs to be upgraded to become more functional for the family members who live there – or for resale. However, a major renovation can be frustrating, unless you’re working with a reliable, knowledgeable general contractor. Here are some suggestions to help make your project go smoothly:
|1. First, do your homework in advance. Identify needs and wants, such as design features and style, with an open mind about costs, timing and resale value.
2. Ask reliable sources for recommendations, but don’t make commitments without meeting a number of contractors. Ask about adherence to budget and timing as well as advice on expectations. Ensure each contractor is registered in good standing with your municipality, and can adhere to building codes, secure permits and provide liability protection.
3. Interview at least three qualified contractors. Find out about their choices for architectural drawings or plans, subcontractors, suppliers and materials. Confirm the product and labour warranties they provide. Once satisfied, request that these and other details be included in a quotation with costs, completion dates, payment schedules for workers and materials, plus allowances for changes.
4. Meet on-site regularly, keep a journal and get receipts for purchases. Don’t pay cash, or hand over your credit card. If necessary, ask your bank to issue a new card with strict limitations.