Will Sellers Get Less for Their Home during COVID-19 in Ontario?
When the COVID-19 pandemic hit at the start of real estate’s hottest season – the spring market – many active home sellers and buyers were left wondering where that would leave them. Sellers who could wait held off listing their home, worried that they would receive less traction and ultimately less profit if they sold during the pandemic. Some buyers, on the other hand, ramped up their searches taking advantage of less competition in the market and hoping to find a “deal”, and they were willing to trade physical showings for virtual tours in order to buy. So, can a seller expect to receive less for their home during the pandemic? Let’s look at the numbers around two common misconceptions: home prices and average days on market.
Misconception: Home Prices have Plummeted
Fact: A drop in sales activity does not mean there has been a drop in home prices. It means that there has been a decrease in new listings in markets across Ontario, resulting in a decrease in sales. But, as we track market activity during the pandemic, at time of writing, year-over-year home prices have remained steady throughout.
While there may have been slight month-over-month price decreases at the height of the pandemic in April, markets that already had year-over-year increases continued to. By May, many markets in Ontario already saw the return of month-over-month price increases and new listings and sales activity improved drastically compared to April.
Because supply is lower than it normally would be at this time of year, what we’re seeing is many homes in hot markets continuing to receive multiple offers, sometimes even in the double digits, and selling above asking in a matter of days, like these two recently sold Purplebricks listings in Orléans, Ontario.
22 offers received and sold for well over asking in less than 5 days! Plus, the sellers saved $16,000† in commission using our service.
20 offers received and sold for well over asking in less than 4 days! Plus, the sellers saved thousands in commission using our service.
In short, selling during COVID-19 does not necessarily mean you will receive less for your home. Like always, what your home sells for is largely dependent on the activity and demand in your area, the condition of your home, and, mostly importantly, if your home is priced at market value.
Misconception: Homes Will Take Longer to Sell
Fact: Average days on market figures have remained largely unchanged in many markets. For example, in the Niagara region, the Niagara Association of REALTORS® reports1 Lincoln, Ontario seeing a decrease in average days on market from 41 in May 2019 to 17 average days on market in May 2020, and Welland, Ontario saw a year-over-year decrease in average days on market from 42 in May 2019 to 34 in May 2020. Overall, the average days on market for all cities in the Niagara region remained the same year-over-year at 41.
Other markets are seeing a similar story, like the Kitchener-Waterloo region2 where average days on market is 20 days, compared to 19 days at the same time last year, and in Hamilton it is taking homes only 3-4 days longer3 to sell on average compared to May 2019.
Overall, there has been no evidence of drastic increases in average days on market during COVID-19, despite health measures being taken to ensure the safety of homeowners, buyers and REALTORS®.
City: London, ON
7 offers received and sold for well over asking in less than 24 hours! Plus, the sellers saved $20,000† in commission using our service.
City: Windsor, ON
Sold for well over asking in less than 48 hours! Plus, the sellers saved $15,000† in commission using our service.
If you need to sell your home, do so with confidence knowing that, at this time, the value of your home hasn’t likely decreased year-over-year and that the average days on market in your area hasn’t likely increased drastically, and may even have decreased year-over-year.
Rest assured that a REALTOR® can help you navigate these murky waters. Purplebricks is here to support Canadians by providing them full-service real estate while saving them thousands in commission when selling their home. As for homebuyers, we share the commission by giving buyers $2,000 in cash back* when they buy a home with us. Call 1-855-999-9740 for more information.