COVID-19, Real Estate & Click-Bait

These past several weeks there have been countless headlines about the real estate market decreasing, expecting it to decrease, speculation of a crash... and while many first time home buyers are probably hoping this is their chance, many homeowners are fearful of losing a major investment. But is any of it true?

This week I saw a headline that stated the housing market is down 69% ... have you ever heard of click bait? Dramatic and misleading headlines trying to capture a readers interest so they click on that article.. When I think of click bait, I think “YOU WON”T BELIEVE WHAT ANGELINA JOLIE WORE?” Only to read the article and discover, it’s a nice dress - she wore a nice dress... what was so dramatic about that? But they got me to click, and more clicks = more advertising revenue. Click bait isn’t just for celebrity gossip. Any headline is click bait. They have to be, when you are scrolling through the endless void of twitter and facebook - they need to capture your attention, a little drama helps the cause. 

So what’s the problem, well the average person scrolling through twitter or facebook sees that headline, but never reads the article...all they know is “the real estate market is down 69%” and now they think the prices of homes have dropped 69%, or that the market is crashing. Here’s the thing , that article, which is actually very informative, tells you it really isn’t some crazy once in a lifetime opportunity to buy a house in Toronto for Owen Sound prices... because everything is actually steady.

Yes, 69% fewer houses sold in Toronto in April of this year, than April of 2019, because, there was 64% fewer homes on the market. That sounds scary,  but during the height of COVID-19 there was a decrease in houses being listed. In Toronto many condominiums were not even allowing viewings. If you didn’t have to have strangers through your home, why not wait it out and sell your home later? Good news though, houses still sold for 98% of the asking price and many over ask. Houses are being listed only 2-5% lower than this time last year, and that is just Toronto. Remember our market update from April for Orangeville and Caledon? Prices were up from this time in 2019 (friendly reminder to follow us on social media @thesawatskys)!  It is still a sellers market, prices have not severely dropped. Furthermore - things seem to be bouncing back - the number of house showings is bouncing back. Flowers are popping up in our gardens, and for sale signs are on front lawns. 

So is this good news or bad news? Good news: real estate is still a solid investment and mortgage rates are low. Bad news: sorry first time home buyers, but chances are you are still in for a bidding war. Don’t worry though, with us on your side, you’ll win one. 

So far, throughout the COVID-19 crisis, our real estate market has held steady, and at the moment appears to be picking up. What the future holds is always a question mark. Unemployment is high, and banks are offering mortgage deferments. We will continue to monitor the situation and update everyone as things change. As always, reach out with any questions. 

Just remember, don’t get caught up in a headline - read the article.