WHAT TO BELIEVE?

I was recently reading a monthly report on a local internet news site about house prices in the Durham Region. It got me to thinking. I read those as do thousands of others, but what are we really to believe? Reason I ask is I have mentioned this before in a piece I called Tell Your Numbers To Shut Up in October. And it made me wonder. What DO people believe? Many of the Real Estate boards would have you believe that what they speak is the gospel truth. And I think some couldn’t care less. They put it out there and you can believe or not. Up to you – whatever. Thing is, how is someone not familiar with deciphering data able to read actual numbers? And what do those numbers really mean. Well here goes. Months of Inventory basically means how many months would it take to sell ALL of the current listings. So if you see 3.6 for example that means it would take just over 3 and 1/2 months to sell all of the listings that are up currently. That number would also be a clear indicator for just how hot or cold the current market is. The norm has mostly been (historically speaking) 3-4 months to clear inventory. The craze in the pre-pandemic and pandemic market skewed numbers out of control. Homes were selling in days, weeks (hours?) for goofy prices in bidding wars. That event screwed up conventional thinking based on long term trends. Sellers were now expecting their homes to be sold in hours, days and weeks. The Days on Market number is also one that has been played with over time. This is obviously exactly what it says. How many days was the house listed before it actually sold? Again those numbers in a balanced market would be anywhere from 60-90 days. In the pandemic mania those numbers dropped to almost zero. Meaning, of course we were in a seller’s market. These days those numbers are actually back to the normal range and in many cases longer than normal. That’s where the market gets confusing. It leaks into a buyer’s market again. And that seems to be what the boards are pushing. They want that. The good old FOMO. Gets things moving again. Except it’s not the norm. Most places these days sit for weeks before any action. In some specific instances they would take less time, but we are definitely nowhere near what was happening 5 years ago. Thank goodness for that. Hopefully, for the buyer’s sake, we won’t get there any time soon. One more thing. When you see after a home has been sold and it shows it was 36 days on the market, check to see if this listing had been posted previously under a different price. Agents will often cancel a listing and re-list at lower price so the listing is “Fresh”. If it is re-listed at a more reasonable price and sells soon that is the stat that gets recorded. So the numbers can lie. Just be able to read between the lines. It will help you make a qualified decision when it comes time to buy or sell.

Feel free to check out this story and more on my blog site at: https://slackie14.wixsite.com/buy-sell-and-more