Ben Sage, Moving Woodstock
May 2016 Woodstock Ontario Residential Real Estate Market at a Glance
May 2016 Woodstock Residential Real Estate Market at a Glance
The trend being set so far this year has continued through the month of May 2016. To summarize, low supply and high demand. Many homes are selling in multiple offers, sometimes way over asking price. These purchases are made by frustrated buyers who have offered several times on other properties and have not been able to secure a home.
Here are some of the highlights:
The monthly average price for a Residential home in Woodstock once again is VERY close to breaking the $300,000 mark. $296,652. This was UP 17.4% from May of 2015.
The number of sales in May this year was 77, which was up 20% from May of 2015.
Once again, active inventory is the biggest issue facing the real estate market in 2016. At the end of May 2016, we had only 110 Residential properties for sale in the city of Woodstock, which is down 50% from 220 in May 2015.
Poor, Poor buyers…..
For the past three months, we have had “record setting” conditions for sellers. Most of the “seasoned” agents in Woodstock are saying that they have never seen it like this. Lineups of people waiting to get into fresh listings, people making cash offers with little regard for inspections or financing conditions, etc. The proof is in the numbers. According to Absorption Rate, which is a measure of supply relative to demand, the past three months have all shown tighter supply than any single month over the past three years.
Take a look at my absorption rate chart – Yes, this one is a bit messy to look at, but if you examine it, the trend is pretty clear. The green line represents the AVERAGE of the past five years. Red, and Yellow represent 2014 and 2015 respectively. You can see low supply relative to demand for May and June in 2014, and in July in 2015. What’s astonishing about this year is how early the spring supply shortage has hit. It’s been tight for a few months now, and showing no signs of letting up. The incomplete blue line represents 2016 so far. As you can see, the last three months represent a record low supply relative to demand. This is causing huge increases in prices across the woodstock market.
1. May 2016 represents the third consecutive month of extremely low supply relative to demand. Three consecutive months lower than ANY SINGLE PREVIOUS MONTH in the past five years.
2. In all cases of “new low” records over the past five years, the supply / demand situation improves within 2 months (restores balance, stabilizes pricing). This obviously hasn’t happened yet, and doesn’t seem to be showing any real signs of letting up.
Questions going forward:
1. When will balance return?
2. Toronto is showing some signs of slowing, is that going to happen here?
The reality is that so much of our demand is coming down the highway from the GTA. Toronto remains strong, and those sellers are cashing out and moving to Mississauga/Brampton. Those sellers are cashing out and moving down the highway to Guelph, Kitchener, Waterloo, Brantford, Cambridge. And guess what? Those homeowners are choosing Woodstock as their new homes.
Prices on the Rise
Prices keep going up. Month over Month, but trends point towards even more appreciation in prices in the short to mid term. The average price in Woodstock reached $296,652 in May 2016, which was up an incredible 17.4% from May of last year, and supply and demand continues to be the dominant force in our market at this point.
Look how the May average price in Woodstock has appreciated over the past five years:
I feel like a broken record. I really do. I’ve been saying this since at least October. If you have a house to sell, you are running out of time to capitalize on the hottest market I have seen in my 9 year Real Estate career.
Listing when there is high demand and low supply is a good thing for sellers! NOW IS THE TIME. Have we reached a new low in terms of demand vs. supply? Are we going to see the bounceback in inventory in the next two months?
Many buyers who have been shut out of the market in the last few months are still shopping, but inventory does not seem to be flooding onto the market at this point. If you are thinking of selling, it’s a madhouse out there. It has never been more important that all buyers and sellers hire a REALTOR® who understands the overall market trends at work, and can advise them on how to properly navigate the current marketplace.
I have been successful helping clients buy, sell, or lease residential, commercial, or investment properties in the Woodstock, Ontario area since August of 2007. With technical experience ... Read More...