No panic, despite numbers
Posted Jul 16, 2010 03:35:37 AM.
This article is more than 5 years old.
We may be reading too much into supposed signs of a real estate slowdown. The Canadian Real Estate Association is reporting home resale’s fell by 8.2 per cent in June compared to May, the second consecutive month of major sales declines. In May, sales were 9.5 per cent lower than they were in April. On an annual basis, last month’s sales declined by 19.7 per cent compared to June 2009, while prices were 4.9 per cent higher.
But Ted Scharf, President of the K-W Real Estate Board, says the comparisons are like apples to oranges. “We had really good months last year in May and June because we were just coming out of that recession and there was a lull in the spring market.”
Scharf says while May and June of 2010 did not compare to last year’s numbers in Waterloo Region, they were still “very good months.” He also says we have to keep the big picture in focus. “Year to date, our sales are up 16% over last year and our average price is up 13%,” Scharf explains. “Our prices are stronger than the national average and while we feel for those areas of Canada where prices are down, we have to look at each real estate market individually.”
Scharf credits the region’s diverse economy featuring strong high tech, insurance and education sectors as factors making this an attractive area to re-locate. Despite reduced home resale’s, he hesitates to call this a buyer’s market. “For every house that’s for sale, there’s a seller that’s going to buy another property,” he says. In some cases, there can be two buyers as former spouses go in different directions. And there are also cases where couples are headed into retirement and add a cottage or resort property to their existing home ownership.
Scharf believes talk of a slowdown may be a little pessimistic. “For the most part, I don’t see any slowdown whatsoever,” he insists. “The slower volume over the past two months is being compared to two great months from last year. Plus, there’s typically a summer lull because people take time for vacations and spend less time thinking about real estate.”
