Happy New Year! I hope that you had a great holidays and that your 2023 is off to a great start.  This newsletter is going to be a little long as there is a lot to talk about heading into the year. The Real Estate market has changed dramatically over the last 6 months across Canada and in Kingston.

In Kingston we have seen the average house price drop from $708,000 in February to $520,000 in December that is a 26% percent drop. Many economists are predicting a further drop between 10-25% by as early as the second quarter.

Homes are no longer receiving multiple offers and selling over asking the first week they are listed. There are a lot of homes that have been sitting on the market for months with a few price reductions. I expect this trend to continue for the short term at least.

The reason the prices are coming down is because of the rates are so high. When the rates are high prices come down and when the rates are low, like they were for the last few years, prices go up!

For some people the current conditions may seem like bad news but for others it is a major opportunity. People still need to move! Life doesn’t stop. Jobs change, families grow out of homes, some people need to downsize. In every market there is opportunity and there are always ways to navigate tough market conditions. It is important that you have a conversation with a professional to discuss your situation so they can best advise you.

For Buyers

• You have an opportunity to purchase a home at a much lower price with a much smaller down payment. Surely the market will eventually recover and when it does you will benefit from the increase in property value.
• If you’re upsizing, even though you aren’t selling for as high as you would have sold your home for months ago, you are buying for way less. It is way better to lose 20% on your sale and purchase the more expensive home for 20% less, then it is to sell your home for 20% higher then it currently is then have to pay a 20% premium on the home you are upsizing to!
• The main hiccup for buyers is the rates! However, there are ways to get around this to. A lot of lenders are advising to just take a 1 year term to take advantage of the low entry price, then re-evaluate in a year to see where the rates are. I even have a lender who is willing to do a 40 year amortization on a 1 year rate bringing your monthly payment down to what it would have been when the rates were lower last year. You can do this until the rates come down.

There are options, like I said it’s important to talk to a professional and not just listen to what you hear in the media or from your friends, family, co-workers who aren’t in the industry.

For Sellers

• If you are sitting on a Nest Egg and are planning to sell in the next 2 years to move to a place that you plan on renting or downsizing to less expensive home. Then I would be selling sooner rather then later. I would not be risking losing another 15-25% of equity in my home should we enter a recession.

• You should expect your home to be on the market for a few weeks/months. This means how your home shows is super important. You need your home to stand out from similar homes in its price range. Pricing your property will also be super important. You want to price it competitively within 3% of the sale price. The longer it stays on the market the more low ball offers you will get and the less attractive it will look.

Should you sell then Buy or Buy then sell?

In the last few months, it has been pretty common to see Buyers making offers on properties with it being conditional on selling their own property. We went 3 years without ever seeing this condition being accepted on properties, but the market has shifted so it is possible to include this condition on some homes. The longer a seller has had there home listed the more likely they are to agree to this. Some builders will also consider it.

Selling your home first definitely has its benefits but is not for everyone. The benefit is that you know exactly how much money you are working with when you go to purchase, and you are more likely to negotiate more favorable terms and price on your purchase because your offer is a lot cleaner.

Everyones situation is different and there are a number of factors that come into play when deciding what is the right way to go about this for you. It’s important that you talk to professionals and develop the right strategy together.

I can certainly help you put a proper strategy in place for your Real Estate goals in 2023. I would love to have a discussion with you about your situation and help you develop a plan for your sale or purchase.

Here are 4 ways I can help you right now

1)Simply reach out to me via text, phone, or email to strike up a dialog and tell me about your situation.

2)Book a home evaluation to find out what your home is worth. I can even do these virtually now over Facetime or Zoom. Let me know a few details about your home and we will go from there.

3) Lock in your mortgage rate for the next 4 months while you shop around. If rates go up, you still get the best rate! All I need is your name, phone number and email! 

4) Ask for my free 26-page pre-listing package filled with a number of tips to help your home show like a model home and a 30 day plan to get your home ready for the market.

I would love to hear from you ! Reach out to me anytime to chat Real Estate!