It’s mid-March and in a “typical” year this is the time Sellers begin to place their homes on the market. In fact, the surge of properties starts in the third week of February with March being one of the busiest months for Seller’s to get their homes on the market. It may seem odd, listing a home for sale when we are in minus crazy cold temps and a foot of snow on the ground, however when you think of a home hitting the market in March, with a 30-day market time until sold and a 2-month closing, the closing would be in June. Buyers love to plan moving dates in June, July and August. So, what gives?
The last years considered “typical” would be 2018 and 2019. Here is what our inventory and sales look like compared to 2018 and 2019:
| Year | Homes for Sale | Homes Sold |
| 2018 | 814 | 376 |
| 2019 | 928 | 366 |
| 2023 | 498 | 384 |
It is easy to see that the number of homes for sale is dramatically lower than in both of the earlier years. The difference between 2019 and last month is the most shocking with about half of the number of homes for sale. The part that is mystifying is that more sales are taking place in 2023. Let me bring up that old law of “supply and demand;” that with high demand and low supply, the results are bidding wars and escalating prices. For context, in the past week, 60% of all homes sold in Oshawa sold for full price or more than asking. In fact, with all sales, the average home sold for 6% over the asking price.
So herein lies the problem Houston – this trend, if it continues will create the messy market we saw from 2020 – 2022, where prices spiked monthly and bidding contests happened on almost every home. Over the past week, Oshawa has had 28 detached homes sell and the average price was $875,000. This means that homes are selling on average for $37,000 more than at the end of February. This is the result of a market with too few homes for sale.
If one would have the opportunity to speak with Galan Weston and could get past his smirk after netting in millions more over the past few years, he would say a common rule when you are ordering inventory is called the “absorption” principle. What this means is if Kool-aid is selling at 50 boxes a month, and you have 20 boxes in inventory at the end of a particular month, you would need to order 30 more to meet demand. In Real Estate terms we look at the same principle. Currently, in Oshawa (all homes) we have an inventory level that would last for 1.5 months. A good visual is if no more homes were listed in Oshawa we would have nothing for sale in 6 weeks. Whitby has a 5 week supply and for all of Durham Region, we would be sold out in 5 weeks! This is a problem. It is a current problem, however, if the Bank of Canada decides to increase rates again, we may seek falling prices and a reversal of low inventory.
The past few years had illustrated how quickly the market can change month to month, and currently, the market is favouring Sellers. If you are mulling over a move, it is simple – get your home on the market. I could not imagine a more perfect time to sell a home than this current market. Prices are rising, inventory is low, and the Buyers have not stopped buying. If you read the current forecasts, you would think that all over our province the housing story is doom and gloom, however here in Durham Region, we are in a very brisk Sellers market. However, a month from now the “nay-sayers” may be predicted correctly. For the time being, the market loves Sellers.
If you are interested in exploring the market either as a Buyer or a Seller, I can be reached at lindsay@buyselllove.ca