In the last 12 months, the Simcoe County real estate market has seen a steady increase in home inventory due to a period of high interest rates. These rates made borrowing more expensive, limited affordability for many potential home buyers and led to an increase in home inventory. However, with interest rates beginning to decrease, the market is shifting, creating unique opportunities for sellers as more buyers start to re-enter the market.
Interest Rates & Housing Inventory
In August 2023 interest rates were higher than they are now, peaking at 5.00% for much of 2023. This steady increase in rates reduced buyer activity as they waited on the sidelines for affordability to increase. Beginning in June 2024, we’ve seen a positive shift, with the Bank of Canada announcing its first interest rate cut in more than 4 years. The good news continued into July with the Bank of Canada announcing a second 0.25% cut, bringing them now down to 4.50%.
As rates continue to decrease, borrowing has become more affordable again which will likely boost buyer activity in the coming months. For sellers, this presents a great opportunity to capitalize on the changing market, as we expect a busy market in late 2024, with many economists expecting an additional cut in September.
How Sellers Can Benefit
With more inventory on the market, sellers can still find success by leveraging these strategies:
Timing: With interest rates dropping, more buyers are re-entering the market, eager to take advantage of greater affordability. Listing your home during this period can help attract serious buyers who are ready to make a move.
Pricing: In a competitive market with increased inventory, pricing your home strategically is crucial, especially with home buyers just starting to re-enter the market. Homes that are priced right are going to attract more showings, offers and are more likely to sell quickly. Working with a knowledgeable real estate agent can help you determine where the market in your area is at and the best price to list your home at. If you want to get a rough idea of your home value, try our instant evaluation tool!
Presentation: To make your property stand out in a crowded market, work with a real estate team that provides staging, professional photography, and an effective marketing strategy. With most home buyers searching online, the photos are often the first showing of your home, and presenting it in a way that buyers can envision themselves living there is essential.
Patience: In a shifting market, patience can be a valuable asset. While interest rates have started to decrease, the market may take some time to adjust. It’s important to be patient as it could take time to find the right buyer for your home.
The Bottom Line
While increasing interest rates over the past year contributed to an increase in housing inventory, rate cuts are going to be bringing the buyers back out.
Sellers who adapt to these changing conditions by focusing on strategic pricing, working with a professional real estate team, and exercising patience can still achieve successful outcomes in this evolving market.
If you’ve been considering selling, reach out and we can discuss the best way to set you up for success!