With fewer listings for homes being put on the market amidst the COVID-19 pandemic, 2020 marks a noticeably hot housing market in Kingston.
Real estate brokers throughout Ontario say they don’t expect this hot housing market to change for the next twelve to eighteen months.
“I don’t see anything cooling, no,” says Matt Lee, a broker with Royal LePage. “I think that when you have a low-interest rate, which makes the payments smaller, and a shortage of listings, it drives this demand.”
Lee says that the interest rates in the area range from 1.7-1.8 per cent on a five-year fix.
These factors make Kingston and the province as a whole a seller’s market.
A seller’s market is when prices for a home are high because of the demand, there are multiple offers on a home, and sellers have negotiating powers, according to RBC.
The MLS® System of the Kingston and Area Real Estate Association says that in February 2021 the average price of homes sold was a record $597,427, a substantial increase of 36.7 per cent from February 2020. They also note that new listings saw a gain of 12.7 per cent from February 2020.
Competitive markets could be stressful or intimidating for first-time buyers, and so Lee makes some suggestions.
“When you’re in a first-time buyer’s situation, I think that talking to the financer first, and having things lined up is a good idea,” says Lee.
“This is a very new process, so I think talking to the realtor about having a home inspection maybe done in advance, if the homeowner will allow it. Just basically getting yourself ready because you want to make sure you’re not going into something with the unknown. But you want to make sure you’re in the position to have a competitive bid.”
Competitive bids happen when multiple people are gunning for the same home. With so few new listings on the market, a house can get nine to ten bids at a time.
There were 43 per cent fewer homes listed in February of this year than there were at the same time last year.
If more homes go on the market in the spring, the scales could be balanced, but Lee is among the experts that say that is unlikely.