In my annual review for 2017, I predicted that 2018 would see a return to a more balanced market in Northumberland; the same bidding frenzies and pure Seller’s market we saw in 2017 would not continue, and sellers would expect more conditions and more balanced negotiations. Well as many predicted we did see a pullback, but what was not anticipated was the severity of the market correction.
The first quarter of 2018 was a plodding start to the year. In Northumberland, sales volume was down by an average of 50%. Activity picked up a little bit through the spring and summer, but at the end of the year, the overall number of sales was down by 26%. The number of homes listed was slightly down by 8.4% in the County, and overall we saw a list to sale ratio of 60%, meaning that roughly a little over half the homes that were listed would result in a successful sale. This is more in line with previous years and indicative of a more balanced market than what we saw in 2017.
While transactions were down, there was a 4% increase in the average sale price to $410,000. We didn’t see the double-digit appreciation we saw in previous years, but overall the market continues to remain stable with a healthy recognition of value. In 2018 the average property sold for 98% of asking price, so although buyers could negotiate more favourable terms and conditions, most homes still are selling for relatively close to their asking price.
So what does this mean for 2019? Overall, the Northumberland market remains stable and is generally balanced between buyer and seller, and I believe that this will continue in 2019. Nationally, many Canadian cities are also in a ‘balanced’ position with low unemployment supporting the real estate market and rising interest rates slowing buying activity. The Canadian Real Estate Association is forecasting national price increases of only 1.7% for 2019. I suspect we will see a higher price increase in Northumberland but not by much more.
If you’re considering selling, it’s always important to remember that the prices are still up compared to previous years, but buyers are more selective. Effective marketing, competitive pricing, and smart negotiation will continue to be the difference between selling and not.
As always, you’re welcome to contact me anytime for a free market evaluation to find out what the current value of your property is.