So says the super-smart, ever-inciteful Seth Godin in his most recent blog post... and which I think sums up the Spring Market we've just had, perfectly.
We've seen a tremendous jump in home prices in the first half of 2015, and only time will tell where we'll finish up at, come the end of the year.
From the June/15 Bulletin of the Durham Region Association of REALTORS® (DRAR):
" The average price of a detached home in Durham
Region reached $502,079 in May 2015. In May
2014, detached homes sold for an average of
$428,914, which demonstrates a year-over-year
increase of over 17 per cent. The average price
for all home types in Durham was $449,837 last
month, an increase of 15.1 per cent compared to
the same period last year. "
The general consensus seems to be that this is the
"new normal" here in the Durham region.
We currently have a population of aprox 600 thousand across the region but that is set to rise to 1.3 million by 2030. It's an anticipated population explosion that we've never seen before, nor will we probably ever see again. Combine that with the fact that there is no more land that is "ready to go" (developed, serviced, etc.) beyond the projects that are currently on the books, and so that will keep the pressure on the re-sale market for the long term.
I've said it before and I'm saying it again, it's been a tough time for Buyers. Sadly some have gotten priced right out of the markets they're seeking to enter when it comes to location & type of home. For the lucky few who are able to get an accepted offer on their next, if not dream home, there's still one more hurdle!
And that's where we're finding a disconnect in the process...the ultra-conservative appraising and lending practices. We've seen a number of deals fall apart (some just before closing, creating a domino effect of messes for Buyers & Sellers alike!) because the appraisals are not supporting the purchase prices and the lenders (of course) will only lend up to the appraised price. Check out my post just on Appraisals HERE
I understand that it's all about risk management, and being conservative is not necessarily a bad thing, but maybe the lending side of the equation needs to look at better aligning itself with the realities of the current market. Because remember...Everything's Overpriced, Until It's Not.
Have a fabulous day!
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