The market is still red hot, with sales and prices continuing to climb. Big banks have even sent out notices to brokerages asking for a full 10 business days for application approvals as they cannot keep up with buyer mortgage demand cross country.
This infographic and following statement were published last week by Liv Real Estate™. It really sums up what has been happening.
Our preliminary look at the real estate market has Edmonton setting new records for sales and prices! Sales of single-family homes hit a record level for March – they were up 70% over the 5-year average – and single-family home prices hit a new record level for March at $451,205. Get all the details on our blog with an update coming next week once the final numbers are released by the REALTORS® Association of Edmonton.
Oh the ground we are seeing what seemed highly priced a few weeks ago to be a good deal today. Now let me clarify this a little. I came across a For Sale By Owner on my Facebook feed this morning listed for $420K as a private sale. This Seller purchased for $350K in 2009. Looking at pictures from 2009 to today, the seller didn’t change much. So, in this example, $365K would seem high a few weeks ago and one would expect the home to sell in the 350s, but because of the market, it would easily sell for $365K. But to say $420K for the home in the neighbourhood would be inaccurate. When talking about average prices, and price increases we are talking about sales where both parties, the Buyer and the Seller have equal access to information and experience and are moving within the parameters of a regulated and transparent market.
With the number of sales rising and buyers negotiating power dwindling, often a “deal” is being able to submit an offer without it being bid up to way over list price in the span of hours. It is not uncommon for Sellers to list their home and have a set day to review offers. This gives all the buyers looking a chance to come through and an opportunity for the Seller to collect multiple offers and choose the best one. Enticing a Seller to sign an offer within hours of listing is possible if one is willing to read the room a bit and give the Seller what they want. Meeting a Seller that is willing to do that can be a blessing, especially in specific areas of the market.
What about the listings not selling? Edmonton still has a gap between demand and inventory, we still have inventory whereas most of the continent does not. What differentiates those who sell and those who do not in our marketplace? Price for sure, then location both in community, and then the lot, then to a lesser extent the home itself. I was a part of a multiple offer scenario in Inglewood where the roof of the home separated from the drywall depending on the season, the listing agent said the roof “breathed” as a matter of fact during a changing of the seasons. This home sold in multiple offers for well over 500K after sitting vacant for almost four months. So, the home is often less important than where it is. Where it is, and who is selling it. A novel could be written on this topic, but I can so for certain, trustworthy, transparent brokerages and their agents get a lot more for homes in a lot less time than their alternatives.
A few tidbits of experience from the past month.
Any home built previously to 1980 is likely to have clay or wax paper (no corrode) sewer lines. It is becoming commonplace to have sewer lines scoped as part of inspection, this is an invasive process, so permission is needed from the Seller. Quoting a line replacement is going to range anywhere from 3K to 15K for the exact same job. Seek companies with “excavation” in their company name. You will notice a big difference. Negotiating on a failing line can be difficult, because up until the last six years or so, many of us have not been having the sewer lines inspected during home inspection, so it can take Sellers by surprise.
Outbreak in a West Edmonton Condo Building was a thing yesterday, and people visiting the building were only notified through a Capital Health posting that read ” 10 Confirmed Cases of Covid-19 in the Building with Two Variants”. News spread through our office quickly that this was happening, people should now be getting better notice so agents and their clients can actually have a choice on whether they show in that building or not.
Real Property Reports on new infills. We ran into a headache on an infill property built too close to the property line and it wasn’t disclosed until closing. We figured because it had an occupancy permit from the city there were no issues. We went to close the file and move in and the home was out by 10 cm and therefore non-compliant with the City. I’m going to blog about this when the market cools off or I want a break, but in short, asking for an RPR with Compliance up front could have saved us some headache and heartache.
“Do not seek a foundation specialist for a second opinion” was muttered by a home inspector casting shade over someone’s home during inspection this month. Notes from the experience, by and large inspectors are unregulated and he owns his own company, he is free to say whatever he wants. Secondly, the buyer trusted a family friend who worked for one of two large foundation companies in the city, so the buyer did get professional advice despite the inspector. Thirdly, inspectors get paid per inspection, with this gentleman, it seems like he is aware of how he gets paid and uses the same tactics over and over and over to get repeated inspections from the same clients. So, when buying or selling, considering the source of criticism is huge. There are several ways to vet inspectors, qualifying questions, and short interviews before hiring one can be helpful. We have a list of said questions available to every buyer.
Ugh, that one gave me heartburn. I guess what really matters to people. Buyers, if you’re shopping, a mortgage broker will likely get you a better rate in a shorter amount of time than any of the big banks right now, so the trick is to find a broker that can provide that and exceptional service. I have a few of those .
When looking between $250K and $350K at townhomes and half duplexes, newer properties without condo fees are going to hold their value so much more. I ran this quick analysis for a client this past month. ( Note, they’re million dollar half duplexes in Windermere )
Selling and Buying?
If I need to Sell and then Buy. I am selling immediately because prices are so good and simultaneously looking for a home. Chances are, with a competent agency, my home will sell immediately for a good price and the challenge will be to be the first one in a good home to write an offer. Should the market shift and demand start to dwindle, at least I have captured a good price for my home and will have more selection moving forward. Sellers are compensating for the threat of homelessness risk right now with elongated possessions of 60-90 days while they go out shopping.
That’s a Wrap
It has been a busy six to eight weeks, most of which is thanks to people like yourselves, repeat and referral business, so thank you! I have officially exceeded last year’s production in the first three months of this year. Fingers crossed, this keeps moving forward and you all continue to see value in what I try to do here. Every client served is a big deal and I hope you know how much you are appreciated.
Thank you for taking the time to read this far, if you have any questions, I would love to hear from you. If you have received this in error, I’m happy to remove you.