As a Real Estate agent I get asked, “How is the market?” a few times a day. I guess its people’s way of trying to gage how it can affect them or to figure out how the economy is going. Its an interesting question and answer because everybody is looking for a different answer to suit them. A person who is looking for an investment property is looking for me to say its slow and to buy now. A person who is looking to sell their house is looking for me to say that houses are flying off the shelves, sell your house now! The person asking me already has their answer they are just looking for me to corroborate what they heard on the news. The news is always bad anyway and its funny how people will buy and sell Real Estate based on what CTV says.
When the news says its a slow market people go house hunting, when people hear houses are going fast they go outside with a marker and write on their garage for sale.
The truth is that the market has a macro environment because of interest rates, unemployment rate, and inflation rates etc. The market also has a micro environment of specific areas, demographics and different neighborhoods which are just as important to gage how the Real Estate market is. If you ask an agent that works in a hot neighborhood during a supposed slow period yes the sales overall will be slow but an area could be turning around. Certain “chic” condos downtown and in the suburbs will have lineups to buy units for Investors even during slow periods.
Here is a list of reasons why people think the market is slow but are misguided by the news and other misguided opinions:
Misguide #1 No bidding war: Most people from my experience believe that if houses are not in bidding wars and selling within a few weeks that the market is slow. In a normal market you could see a bidding war but it is not common like we saw a few months ago.
Misguide #2 Agents bad opinion: Most agents have not witnessed an economic downturn like in the early 90’s and 80’s. An agent has to have the skills to actually sell your house and showcase their selling skills this is not uncommon. Following up with buyers, open houses, making calls, advertising and marketing is not a reason for a slow market.
Misguide #3: For Sale By Owner doesn’t work: People who to try to sell their house on their own cannot sell because they do not know how to. In a overwhelming sellers market there is not inventory. People who must move will move even into something they do not like because they have no choice. People will settle or do renovations. Then a year later they move out. In a overwhelming sellers market anybody can sell a house, even your pet turtle. The key here is what happens when the market slows down. You have to work. That is the reason for an agent to do a job. When FSBO’s do not sell they’re house they tell everybody the market is slow. No its not you just can’t sell a house, your an Accountant not a Real Estate agent!
Misguide #4 The NEWs: The news is here to sell news. They are here to get ratings, sell airtime and get you to stay tuned. If they tell you that the market is a little up or down then you will stay tuned. If they tell you that the statistics show that it is normal for the market to go up and down every year they will not sell any commercials and will not get viewers and you will tune out. If they exaggerate the news of a slow period they will get you hooked to watch tomorrow and you will because you are worried how it will go next week when you put your house for sale.
Misguide #5 Your neighbor: Everybody knows that person that thinks they know something about Real Estate. Somebody who has bought and sold property or had a recent bad experience. As an agent there are all types of experiences out there. Some are good and some are bad. People always go on and on about negative experiences. They like to speak about what they heard from the people around the corner. “Don’t sell your house now, its a slow market I heard.” “They had a hard time selling!” In reality who knows what the situation was, maybe they priced the house too high or their house had a lot of bad things associated with it. Maybe the house was dirty or smelled. Maybe there was too many renovations to do.
The overall market has slowed down but that doesn’t mean people are not buying Real Estate? The best thing to do is find your local statistics and you could see that your neighborhood might not be in a buyers market it might be the direct opposite.
So the next time you ask me how the market is, remember what answers are you looking for me to tell you?