3rd quarter update

3rd Quarter Brandon Market Update

The Brandon Real Estate market has shifted, we all know that…or at least you should unless you have had you head in the sand(or snow).  Prices have dropped, and so has the market activity.  But is it really as bad as people seem to think it is?

 

Are people still buying houses in Brandon?

Are prices falling through the floor?

Is our market crashing?

 

These are some of the questions I am asked regularly when I am out in the community at events, or even while sipping on my coffee while watching the boys play hockey.  Lets answer these 3 questions in more detail, and help you paint more accurate picture of what is happening in our market.

 

Are people still buying houses in Brandon?

People are definitely still buying houses in Brandon. There are still SOLD signs going up on a regular basis, and for Jenn and myself we are putting them up more often than in years past.  But the market as a whole is seeing fewer sold signs year to date, then in recent years past. We recently had a very interesting conversation with Chris Turcotte, President of CENTUM financial.  He shared with us that the number of new buyers and applications for pre-approval is trending to be up in 2018 in Brandon.  WOW, you read that right!  There are more buyers looking to enter the Brandon real estate market that in years past.  Just how many new buyers you ask?  In 2017 CENTUM submitted and pre-approved 777 new buyer applications, as of Sept 21, 2018 they had already submitted and pre-approved 668 new buyer applications.  This is a 16% rise in new applications and new buyers in our market. So what exactly does this mean? Does this mean your house has a greater chance of selling?  Maybe, but there are way to many factors in that questions to answer with a simple Yes or a No.  The best advice we can give when it comes to capturing these buyers is to have the right plan with your agent. A plan that gets your house in front of these new potential buyers in a way that allows them to connect to your home.  New buyers means opportunity for our market, but only if we see it as an opportunity to connect with each other.

 

Are prices falling through the floor?

So if there are still many new buyers coming into the market why are prices falling and houses sitting on the market for so long?  Each price range in Brandon is so different than the next.  The $400,000 and above priced homes are in different demand than the houses priced between $200,000 and $300,000.  So we see changes in pricing happening at different rates.  The average house price in Brandon is down in 2018 compared to 2017, at this point in 2017 the average price was $283,333 for a single family home where as in 2018 the average price is down to $276,682, a decrease of 2.34%.  This is not a huge change but when our market has been used to steady growth over the past years any change to the negative seems that much greater.  One thing to keep in mind with this number is  it represents our market as a whole, it is not price range specific.  The market activity for houses priced $400,000 and above has changed, there are fewer buyers and more inventory in this price range which equals an overall decreased in average sale price.

 

Is our market crashing?

The national news is often discussing a market crash. It is important to remember they are mainly referring to big city markets like Vancouver, Toronto and Calgary.  But when you are actively in the market for yourself here in Brandon this naturally raises questions locally.  The Brandon Real Estate market is down this year. We are projecting 2018 to be the slowest year for transactions in the past 4 years.  In 2017 there were 607 transactions in Brandon, 2018 is trending to be 13% down for a total of 538 transactions before end of this year.  This is a significant drop in transactions, so what is causing this?  There are a few theories on this, but the major factor I see (and what we work to help our sellers to understand) is technology is changing the way buyers view properties and make decisions.  There has never been a time in our real estate market that buyers have as much information available to them as they do now.  Buyers are taking their time to research their purchase, compare each property and decide value on each house based on the information they can access on the internet.  The ability of buyers to get this information is a game changer in our market.  Other factors also come into play with market activity and pricing. In 2016 the government changed mortgage qualification rules for buyers with a downpayment less than 20%. This had a significant impact on our “entry” level market until these buyers adjusted to the changes.  The rise of interest rates is another factor playing a role in our changing market, the higher the rates climb the less purchasing power buyers have. So although our average sale price, and transactions will be down in 2018 I feel our market is definitely experiencing a correction or shift, but do not think this is a market crash. The increase in mortgage pre approvals, therefore potential Buyers, indicates that our market will continue to see activity and sales.

 

To learn more about how The Shields Group has grown our market share in 2018 by helping more families buy and sell their homes, give us a call and let us take you for coffee or click here to download our Home Buyers Package or Home Sellers Guide.