When the Canadian Real Estate Association predicts a spring boom because of;

• Pent-up demand.
• Lower borrowing costs.
• Typical spring flurry of sales.

What do they mean? Are they missing any key predictors that may cause a change in real estate over the next few months? Let’s take a look.

Pent-up demand: I think we all know what this means. However, how does it apply to our market? From 2020 to 2023, Canada absorbed 1.3 million permanent residents and foreign students. With the market pausing in mid-2022, a large group of these residents are eager to buy. Everyone needs a roof over their heads, and they will find a way into the market. 

Lower borrowing costs: We saw 5 Bank of Canada rate reductions last and a prediction of the lending rate reducing to 2.5% by the summer. The average cost of carrying a home in the Durham Region has come down by over $1,000 per month since 2022.

Typical spring flurry of sales: The spring market traditionally begins in late January and lasts until April. May is the first month when Sellers decide en mass to list their homes for sale, causing a slowdown in the spring boom. 

I spend my days reviewing the inventory and sales, looking for trends in the marketplace, and early this year, several trends are starting to emerge. One is a lack of inventory. In September 2024, 927 detached homes were sold from Whitby to Clarington. By the end of the year, that number had dropped to 446. We started this year with an inventory deficit, and in turn, the number of sales this year has been less than the same 3 weeks in 2024. The sales in the first 3 weeks of last year were 157 compared to 99 this year. It would make sense that when inventory drops, Buyers would be out in force, causing bidding contests; however, many of the best properties have sold, leaving less attractive homes on the market.

Political distractions: Since mid-December, Canada and the USA have been politically in turmoil. Political turmoil surfaces as uncertainty, and when Buyers and Sellers see uncertainty in the market, they tend to fence-sit and observe how things play out. This seems to be at play over the past month, further dampening sales.

With the distractions beginning to fade, realtors are beginning to hold offer presentations to date to raise bid prices. Over the past 48 hours in Oshawa, Whitby and Clarington, 20% of all new listings were holding off on offers and in the past week, in the same areas, over a third of the homes sold for full price or over asking,

We are heading into a spring market, which will be typical of the spring cycles we have seen during balanced markets. Buyers begin the cycle by snapping homes up and driving prices up, which in turn causes Sellers to place their homes for sale. Expect some stunning homes to hit the market and values to spike over the next few months. 
If you have questions about how to secure the best-priced property or how to sell at top value, I can be reached at lindsay@buyselllove.ca or 905-743-5555.

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