Advice for Calgary Home Sellers: February 2023
This advice is for the sellers choosing to have their home on the market to start 2023 and all those just about to come.
The Calgary Real Estate Board released its January reports this week, and despite the significant year-over-year decrease in sales, January was a strong month compared to the long-term trends.
So my first point of advice for the sellers out there: Well, it is the same as my advice to those planning to buy & that is, Know Your Market.
If you were selling this time last year, the market was strong almost everywhere, and you could practically do no wrong. Within hours of being on the market, you likely had multiple offers and a price close to or over what you were asking.
This year, the overall market is very different, as each segment and price range is shifting at a different pace. The increase in interest rates has impacted overall demand, and in 2023 I expect to see a continued shift to more affordable product types.
Selling a townhome or an apartment will be different than a detached or semi-detached home, depending on the neighborhood and the price point, so know how your market is performing before you list your home.
Point 2 is about supply, which I have talked a lot about since the fall. Inventory levels started the year at historic lows, and in January, new listings fell to the lowest levels since the 90s. February will begin with about 2450 available homes for sale, a total 43% lower than long-term trends, so there isn’t a lot out there for a city of this size.
When you look one level deeper, there is a significant variation by price range and segment. Detached homes priced under $500,000 reported a year-over-year inventory decline of 30%, while inventory levels grew for homes priced above that. Inventory levels in the Townhome and apartment segments are close to 30% below last year.
So if you are thinking about selling, whether it is an apartment, townhome, or a detached home under $500,000, the environment of low inventory and strong demand are currently working in your favor.
And that brings us to Point 3: Sharpen your pencil regarding your list price. Even though conditions favor those selling, especially in those affordable product types, if your home isn’t priced right, it will end up sitting, and you risk it becoming stale. The increase in interest rates has created price sensitivity, so even an asking price slightly above market value can result in a lack of interest. In January, those priced at market value had a sale price of 97.5 to 99% of their asking price.
As we approach spring, sales don’t typically ramp up as quickly as inventory, so although inventory levels are low now, you can expect to see more competition in the months ahead.
So, in summary, even though sales are down year over year, you can still have success selling your home by knowing what your market is like before you list and by making intelligent pricing decisions.
You can watch the video here:
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