I put together a listing presentation today for a potential seller living in beautiful Panorama Hills and noticed a variety of indicators that may very well be pointing us toward some interesting trends over the next little bit. At the time I wrote this blog there were 80 homes for sale in Panorama Hills.
From January to the end of May there were 137 sales in the community and
a whopping 36 (26%) were sold in May alone. So far this month (June 10th to be precise) there have been six firm
sales and there are 11 homes that have been posted as conditional sales. These
are all great indicators for us as a seller, it would certainly seem that the market
is in an upward trend.
Let’s look a little deeper at both the inventory as well as
sales so far this year. Of the homes that are currently active in the
community, 36% have been on the market for less than a month. 28% of the active listings
have been on the market for between one and two months and 31% have been on the
market over two months. It is interesting to see that so many homes have been
on the market for such a long period of time as we have seen an average of just
over 27 sales per month, pointing toward a fairly balanced market in the area. It would seem to me that a good portion of those homes that have been on
the market for such a significant amount of time need some major changes in
their listing strategy to get the job done.
I believe it is also paramount to point out the price breaks in relation to actual sales and active listings:
So far this year 32%
of the sales were under $450k whereas only 12% of the listings
are in this price category today;
27% of the sales were between $450k and $500k and
only 16% of the listings are within this range;
41% of the sales were over $500k and now over
70% of the listings are asking for this price range!
The real kicker here is where the sales are so far this month... there is one firm sale over $500k and four pending sales that could possibly be in that range (29%); there are possibly five sales between $450k-$500k (29%); and seven under $450k (41%). These numbers are deviating significantly from what we have seen up to this point this year.
With the numbers becoming so far apart between what a seller
would like to sell for, and what the typical buyer is looking for in the
community, we could be in for some very interesting times indeed! If the buyers cannot
afford any more than the previous sales are showing – perhaps they cannot
qualify for the higher mortgage – we can expect a variety of things to happen in the next few weeks… homes will stay
on the market longer and longer, and eventually we will see pricing slowly move
back to the ranges we have seen in the early part of the year. Alternatively,
buyers may need to re-qualify for a larger mortgage or find more cash to put
toward a purchase. In my experience, finding additional cash to close is quite
difficult, and unless mortgage regulations are altered, finding that higher
mortgage limit will also be difficult if not impossible.
I hope these observations within this micro market of Calgary are not indicators for the entire city, however, I would keep close attention to these ratios and sales figures.
Interestingly enough, the numbers I noticed a month ago are only getting further apart. There are now 71 homes for sale in Panorama Hills, down nine or about 11%. There were 34 sales in June, a couple short of the 36 sales in May. What is significant is how the sales are broken down. Ten were under $450k (29%) 11 were between $450k and $500k (32%) and 13 were over $500k (38%). So it would seem that the midrange is slowly increasing whereas the higher and lower ranges are decreasing. What is more disturbing is the fact that 77% of the active listings are now over that $500k model and each of the other categories each have 11% of the listings fall into their ranges.
ReplyDeleteThere have been about 12 sales per month on average so far this year over $500k. That would indicate that we have over four and a half months of inventory in this price range, definitely a “buyer’s market”. What I see here is that the Seller has to be extremely aggressive in their online presence, marketing and pricing. There is little room for error in pricing, so being accurate right off the bat is of prime importance. At this point there is nothing to be alarmed at, however, as the year moves further along, many sellers that have been on the market for some time may be tempted to lower their expectations and reduce their pricing in order to secure a sale. At the moment this micro market may be under most radars, now you and I are aware!