Then vs. now
The pandemic effect: A three-year retrospective on London real estate
OUR FIRST PANDEMIC summers we were entombed in our homes, washing our groceries and venturing out to bang pots during the shift change in support of our front-line heroes.
While cocooned away, the blood sport was to monitor Realtor.ca, because if you weren’t “playing” the real estate game you were missing out. Real estate was an “essential service” and the irrational exuberance made for full-scale drama. Prices at the beginning of 2021 were basically the same as they are now, at the beginning of 2024.
That first pandemic year, prices increased by almost 50 per cent in just eight months! As mentioned, we ended that year about equal to where the average price is today. In that year of 2021, prices continued to climb, rising another 30 per cent over the next 12 months. Now, as we settle into 2024, it is perhaps appropriate to contrast the market conditions this month as compared to January 2021.
Key stats for January 2021: about 400 homes for sale representing two weeks inventory; homes selling for about 10 per cent above the asking price; homes selling within seven days.
Now let us compare January 2024: about 1,600 homes for sale representing 12 weeks inventory; homes selling for about 5 per cent less than asking price; homes selling in about 33 days.
“My advice: don’t try to time the market; it has stabilized and is unlikely to see significant change in this calendar year. Live your life, sell your home when you’re ready, buy the home you’ve always wanted”
The uber seller’s market of 2021 was unprecedented ― huge demand, almost no supply, multiple bidding wars, homes being sold well above the asking price and selling almost immediately. Contrast that to the buyer’s market today ― limited demand, generous supply, rare multiple offer situations, homes being sold well below the asking price and taking over a month to sell.
As we enter 2024, we shouldn’t expect any exuberance, let alone anything irrational. This is a very different market, in a very different time. The London real estate market has stabilized. Affordability is dramatically reduced today as compared to three years ago. Inflation is still being tamed. Political uncertainty exists in much of the developed world. The world struggles to respond to geopolitical challenges on every continent. Our changing climate teaches us increasingly difficult lessons every year.
So, as we wrap up this January as opposed to three years ago, we should stop imagining a “potential” decline in the bank rate is going to fuel a significant change in the real estate market.
If by chance buyers are attracted back to the market by a signalling bank rate cut in March, it will also mean a flood of new offsetting listings. Supply will keep pace with demand, and the uncertainty in the world around us won’t have resolved. My advice: don’t try to time the market; it has stabilized and is unlikely to see significant change in this calendar year. Live your life, sell your home when you’re ready, buy the home you’ve always wanted. In the long run, real estate is still the best play, but it shouldn’t be something we gamble on ― as so many of us did in the not-too-distant past.
Market analysis provided by Marcus Plowright, Sales Representative, A Team London. Marcus can be reached at 519-872-8326 or [email protected].
High- and low-priced real estate listings around town this week
London East
Low
Address: 206-563 Mornington Avenue
MLS number: 40502105
List price: $159,900
Days on market: 12
Size: 1 bedroom, 1 bathroom, 683 square feet
Listing agent: Scott Vannoord, Realtor, Sutton Group – Sutton Select Realty Inc. Brokerage
High
Address: 1117 The Parkway
MLS number: 40527868
List price: $1,990,000
Days on market: 20
Size: 5 bedrooms, 5 bathrooms, 3,834 square feet
Listing agent: Raven Mullen Sales Representative, Sutton Group – Select Realty Inc
London North
Low
Address: 317-511 Gainsborough Road
MLS number: 40509124
List price: $239,900
Days on market: 84
Size: 2 bedroom, 1 bathroom, 885 square feet
Listing agent: Robert Di Loreto, Broker of Record, Royal LePage Triland Robert DiLoreto Realty, Brokerage
High
Address: 82 Northumberland Road
MLS number: 40523141
List price: $2,599,900
Days on market: 15
Size: 7 bedrooms, 5 bathrooms, 5,150 square feet
Listing agent: Paula Hodgson, Broker of Record, Sutton Group – Hodgson Realty Inc. Brokerage
London South & West
Low
Address: 79-198 Springbank Drive
MLS number: 40524940
List price: $199,000
Days on market: 27
Size: 2 bedroom, 1 bathroom, 1,020 square feet
Listing agent: Karen Greason, Broker, Re/Max Centre City Realty Inc.
High
Address: 467 Commissioners Road East
MLS number: 40522839
List price: $2,300,000
Days on market: 43
Size: 5 bedrooms, 5 bathrooms, 5.505 square feet
Listing agent: Kristen Clowry, Broker, Real Broker Ontario, Ltd.
Disclaimer: London Inc. does not guarantee the accuracy of the statistical data on this page. The data does not represent the listings of any one agent or agency but represents the activity of the real estate community in the area. Any real estate agent’s ad appearing is separate from the statistical data provided, which is in no way a part of their advertisement.