To make the most informed decision when buying a house, you must have all the facts at your disposal. We know that's easier said than done, especially for something as puzzling as the housing market.
If the whole process leaves you scratching your head instead of moving forward with buying or selling your home, then don't worry. We've compiled this guide to the current real estate market in the Niagara region to give you an insight into what it may look like when buying or selling your home in 2022.
We don't need to tell you that the housing market has been quite a turbulent few years, with the pandemic making house prices jump by a whopping 34% from March 2020. While we expect this as economies worldwide felt the pinch, it doesn't soften the blow to many first-time buyers and hopefuls.
So, how has the pandemic left the real estate market?
The most significant factor would be the decline in house sales year-to-year, and 2022 is no different.
While a trend of low-interest rates has been a lifesaver for the market, the Niagara region favors sellers instead of buyers, with an over 15% decline in total house sales across the entire Niagara region.
While we experienced this plummet in sales, the region saw a record-breaking surge in average house prices. Take the Niagara Falls area; the current average house sale price stands at $814,513, a 26.8% increase from January to February 2021.
Houses are also experiencing a decrease in the amount of time they're on the market. As it stands, the average home within the Falls region has dropped from 27 to 23 days on the market.
We hate to disappoint you if you think the Niagara Falls region appears to be a fluke. The Grimsby region has taken first place in one of the most significant price surges in the area. The current average sale price stands at $1,022,865, a little under a 34% increase in the region alone.
Most trends at the end of 2021 predicted that this year would see buyers looking to smaller cities and towns to fight the increase in prices. Still, the housing market's current state supports the seller over the buyer.
With surprises around every corner in recent years, it's no surprise that the Niagara real estate market is shifting to a new era. The region has benefited from low-interest rates, which has kept the market afloat. But, as inflation increases, we expect that period to end pretty soon.
At the beginning of this year, experts predicted that there would be a significant hike in the current interest rates of the region as the cost of other necessities like food and bills increase. The Bank of Canada increased its key interest rate by 0.5% in the first of what is expected to be many hikes in the near future. While this is done to cool off inflation, it may have an impact on how we buy our homes, specifically those looking into mortgages.
With this shift, it's only natural to wonder whether this significantly impacts those looking to buy in 2022. Considering the current decrease in the supply of houses going to sell, the increase in interest rates, inflation, and the trends over the last few years, it's likely we won't see a drop in real estate prices across the Niagara region.
Experts suggest that we're likely to see significant hikes in real estate prices until late 2023. This is outside of the norm, as we would expect to see such bubbles in price burst eventually, but this isn't the case.
While we aren't likely to see a downturn in prices until early 2023, buyers may have more headroom in less densely packed areas of the Niagara region. The market is still, of course, set to be dominated by sellers in 2022. Still, Niagara offers buyers a myriad of housing options, so if affordability is on your mind this year, you may be able to get a bargain in the current climate.
Are you a seller? Are you feeling emboldened by the forecast? Given the circumstances, you'll want to know how long you should wait before selling your house. Every situation is different, and the length of time you should wait before selling your home depends on your mortgage and your finances. It's also important not to rush the selling process, as houses aren't staying on the market for very long.
You should wait around five years to stay in your property before thinking of selling it. This is because you need to make sure you can make up for mortgage interest rate costs, real estate agent costs, and closing costs. Doing this ensures you get much more for your money.
As interest rates are likely to increase further, with inflation looking to follow the same pattern, it's expected that the inflated housing price bubble will stay intact for a while, so you can take some comfort that time is on your side.
Selling your home can be stressful, and as we know, moving is one of the most stressful life events you can confront. We would like to share some advice to help make the process as stress-free as possible.
1. Research is everything
Although this year is a seller's market, if the last few years have taught us anything, it's to expect the unexpected. Ensure that you keep a keen eye on the current state of the real estate market in the Niagara area, particularly on how much house prices are increasing in the area.
Be sure to note whether the supply of homes has increased, as this can impact how much your home sells. It would be best to get in touch with a reputable real estate valuer to get you the best estimate based on your area and your property's assets.
2. Take care of any quick fixes before the sale.
There might be a temptation to down price if there are issues with the property, but if you can quickly take care of things, then do so. This can significantly increase the amount you bring away at the end of the sale by increasing the property's value.
3. Disclose any damage.
As is common after a particularly snowy, cold winter and spring, some homes in the area start to feel the effects of water damage from flooding after a big thaw. You should disclose any other elements that could render the property unsafe to your real estate agent.
If you're feeling disheartened by some of the current real estate markets, don't worry, there are several things you can take away from the forecasts and what we've learned over the last few years. To help you, we've compiled some advice for buyers to navigate this confusing yet exciting time:
1. Consider your budget
As we've mentioned a few times, prices are soaring, and with the rise in the cost of living, prices are unlikely to come down for a while. With that in mind, you need to assess your budget. We recommend that you use insights from your salary and the help of mortgage calculators to figure out what you can reasonably afford.
Doing this can help you decide which areas are most affordable and realistic for your budget and lifestyle. Make sure you have a good idea of where your money is going. Knowing where the money is going can give you a better chance when dealing with a credit analyst and mortgage lender!
2. Think about less densely populated areas.
As our report suggests, the less densely populated area has the most budget-friendly options in Niagara real-estate currency; consider smaller cities and towns when searching for a house. You should also consider whether searching for homes in smaller cities and towns can be kinder to your wallet.
3. Find a good Niagara Region Real Estate Agent.
Finally, we can't stress enough how important it is to find a good Niagara realtor when house hunting. We recommend you get in touch with a Niagara Region Real Estate Agent who can assess your needs and desires and help you make the most informed decision for you and your family.
While we're not fortune tellers, the real estate forecast for the remainder of 2022 is transparent. To give you a quick and easy guide to what the rest of this year may look like, here is a list of our projections you can use, to make the most informed decision about selling your home or buying a property: