Are you worried about the real estate market? Do you believe the headlines that say a crash is coming? Let’s take a few minutes and look at what exactly is happening in the Kingston real estate market. For the first six months of 2022 sales activity remains strong last year, partially due to the pandemic market demand was at an all-time high this year. We’re seeing a return to the normal seasonality of the Kingston market. In addition, changes to interest rates mean that some home buyers are putting their plans on hold. Last year there was a high peak of activity and this year we’re returning to normal rates.
Conversely, new listings have increased. So a number of homeowners have been kind of sitting back and saying, I don’t know if I want to list my home right now. But in May and June, we saw more homes on the market than we saw previously last year. That’s a shift from what we’ve seen since the beginning of the pandemic. Months of inventory: For the last two years, we’ve been talking about the fact that there’s not enough inventory and that’s driving prices higher. In June, we’re at 1.9 months of inventory. It’s important to remember that a balanced market is still four to six months. So while things are getting better from a buyer perspective, it still remains a seller’s market in Kingston.
During the last two years, there’s been the frenetic buying. You’ve heard about offers way over listing price, with no conditions. It seemed like a for sale sign went up and the sold sign was up three days later when they were holding offers. Now we’re seeing a reduction in that practice of holding offers and more and more acceptance of conditional offers. What that’s doing is increasing the number of days on market. It’s great news for buyers, and it just means that sellers need to alter their expectations. Your home may be on the market a little bit longer, so it’s really important to have a strategic price and a solid marketing plan. We talked about the “over asking.” You’ll recall a few months ago when a house listed at 399,000 would sell for 650,000. It was great for those sellers but so frustrating for buyers. This activity really peaked in February and March, as buyers were racing to secure homes before interest rates went up. In June, the average selling price was 2.2% above asking. What that means is when you see a home listed now, chances are that the asking price is very close to what the seller’s expectations are.
That crash that we keep hearing about. You can see that since that peak in February and March, the average price in Kingston has declined slightly. No big drop there, but we remain 10.6% over last year. Comparing back to June 2020 at the beginning of the pandemic, prices on average are still 39.6% higher in the Kingston market. So home sellers out there that are worried that they’ve missed the boat, you haven’t.
What’s the bottom line? It continues to be a seller’s market in Kingston, but the competition is slowing. There are fewer bidding wars, less “holding offers”, which certainly gives some comfort to buyers. There are more conditional offers being accepted, which eliminates some of the risk that buyers were taking over the last couple of years. Homes are still selling, but it may take longer. There is another interest rate announcement expected in July. We’re waiting to see what that does and what impact that has on the market. And right now, more than ever, it’s important that you choose a REALTOR® that has experience and expertise to help you buy and sell.
Watch the mid year market update
Date Source: MLS®️ Systems, CREA
