Since April and the announcement of the Foreign Buyer’s Tax I have been reading and listening to many different commentaries from the media and been asked by many people (who have been fed information from the media) about whether the real estate market is “tanking” or going to burst.
I would like to offer a different perspective with some information that the media/banks/your neighbour may not have considered and which ultimately paints a might brighter picture than what they are reporting on (or passing along).
Here are some facts about the real estate market. Every year we see:
more listings in late Spring (usually after Easter at some point);
buyer fatigue – when buyers get tired and take a break from wanting to compete in multiple offers and often comes after a long period of buyers competing (which this season started in the late fall); and
a shift in how properties are priced (pricing it at market value vs. way below market value with an offer night.
As a buyer, here is how you could benefit from this seasonal shift:
As usual, this time of year we see more properties become available for sale. With more options, there are generally fewer people bidding on the same houses. The benefit to you: There is a bit more time to make a decision and fewer people competing for the same properties. The fewer people competing the higher the likelihood that you will be able to purchase the property AT market value vs above.
Fewer offer nights.
Since there is generally more inventory at this time of year, we tend to find more properties are priced at market value with the opportunity to make an offer to purchase at any point. Let’s face it: offer nights are stressful for everyone so it’s way more civilized to be able to submit an offer when you feel ready and have some options to negotiate.
School’s out for summer – well almost.
Many buyers with kids prefer to buy in the spring market so they can move over the summer vacation months. For this reason, many of them have already purchased and/or those that haven’t are usually busy with end of season dance recitals or sporting events. It’s a busy time for parents which translates to fewer buyers on the scene. AKA: less competition for you!
With all the misinformation being circulated around the foreign buyer’s tax some sellers are feeling more ‘keen’ to sell or cash out. Because of this, some sellers might be more willing to negotiate. I would like to add: while there are some opportunities to offer less than asking bringing a super low ball offers is not where things are at. Sellers are not desperate or dumb. And many will not sell if the offer isn’t right.
Overall here’s my take:
It won’t be long before we are back in a situation where there are low inventory levels, and demand will be high again. So while people take a second to pause and ponder what this tax means or how it affects the overall market: now’s the time for decisive people to take advantage of the opportunities listed above. Anytime you have the option to negotiate and not be in competition: that is a WIN and cost savings.
I am always happy to discuss in more detail. To chat more – just reach out.