Market Value Adjusts in November
There are a few interesting trends to note as we close out 2013. Overall year-to-date there is an increase in the number of homes selling over $350,000 however in the past two months there has been a reduction in the number of homes sold in this range compared to last November. According to Jason Yochim, Executive Officer with the Saskatoon Region Association of REALTORS®, "The median sales price over $400,000 has actually decreased over the past couple of months as we see more inventory, especially in new construction. Also, the spread between list and sell price tends to widen as you move up in prices." The sales to listing ratio, which compares the number of units listed to those sold for the period, is higher in the lower price ranges versus the higher end. This is again due to less inventory in the lower price range.
New number of new listings for 2013 is up 10% over last year however "many of these listings are previously listed properties that failed to sell as a result of being overpriced and have been relisted at a reduced price in order to bring them closer to market," adds Yochim. Further evidence to support this is a 2% increase in unit sales compared to 2012. The average selling price for the year is up 4% over last year which contributes to the overall sales volume pushing closer to 1.5 billion is Saskatoon.
Overall the market continues to be healthy with a strong demand for homes in the $300,000 to 500,000 price range. The surplus of inventory over $500,000 is due to a couple of factors such as unrealistic expectations when pricing as well as over 200 new home builders with product on the market. This does not mean that the "bubble has burst" and the market is falling headlong into a buyers' market, but rather a subtle reminder that although we are in growth mode, the growth and price increases have limitations.
The market will always determine the true value of homes through supply and demand and eventually the pricing must follow suit. "This is just a gentle reminder to sellers that regardless of what they feel their home is worth, they have to respond to what the buyer is telling them and price to market".
In a market where price trends change constantly, the best way to determine certainty of the value of residential or commercial real estate is to contact one of the more than 600 professionally licensed and trained REALTOR® members of the Saskatoon Region Association of REALTORS®. REALTORS® subscribe to a strict code of ethics and are dedicated to developing professional standards and continuing education in the real estate profession. **taken from the SRAR The View newsletter** volume 13, issue 10