The countdown is on to the holidays and the end of 2022. It’s been another wild ride in real estate, and November has provided more of what we have seen over the last several months, a low number of new listings, low sales volumes, and declining prices. Expect this trend to continue into 2023.
The Month of November 2022
In November there were 42 homes listed for sale a 4.55% decrease from the 44 homes listed in November 2021. This figure is slightly below the ten-year average but is close to what is expected as we enter the slower winter months.
22 homes sold in November this is a 56.86% decrease from the 51 sales that occurred in the same period last year. This is a trend that has continued since the end of summer and decreased demand is due mainly to the fast increase in borrowing rates this year.
With 22 homes sold and 42 homes listed for sale, the Sales to New Listings Ratio (SNLR) was 52.38% in November 2022. The SNLR between 40% and 60% is generally considered to be a balanced market but as I have been saying here over the last several months the Orangeville real estate market is truly behaving like a buyer’s market.
The Average Sales Price for a home in Orangeville in November 2022 was $732,027, this is a 15.13% decrease from the average of $862,575 in November 2021. When comparing the Average Sales Price in November to the peak experienced in February there has been a decrease of $317,643 or 30.26% in the average selling price of a home in Orangeville.
The Average Sales Price to List Price Ratio for a home in Orangeville in November was 96% which remains very strong and is indicative of homes that are priced properly are continuing to sell.
The Average Days on Market for a home to sell decreased slightly in November to 28 days and while this remains a low number in a historical context it is a significant departure from what sellers had come to expect over the last two years.
At the end of November, there were 64 homes available for sale in Orangeville, this is a 481.82% increase from the 11 homes that were available for sale at the end of November 2021.
With 64 homes available for sale and 22 homes sold in the month of November, there are 2.9 months of inventory at the end of November. Normally it is considered a seller's market when there are less than 4 months of inventory, a balanced market when there are between 4 and 6 months, and a buyer's market when there are more than 6 months of inventory.
Year-to-Date November 2022
Over the first eleven months of 2022, there have been 882 homes listed for sale in Orangeville an increase of 8.62% from the 812 homes listed in the same period in 2021.
Through the end of November, there have been 476 homes sold in Orangeville a decrease of 31.31% from the same period a year ago and below the ten-year average for this point in the year.
Year-to-Date the Average Sales Price of a home in Orangeville has been $916,251 a 14.97% increase over the $796,980 average over the same period last year. This remains impacted largely by the sales in the first quarter of the year and continues to decline each month.
The Sales Price to List Price Ratio year-to-date is 105% and the Average Days on Market is 16 days year-to-date again both figures have been declining for most of the year after the market conditions that we experienced early in the first quarter.
What Does All This Mean?
It all comes down to interest rates. With higher borrowing costs there has been a decline in the number of sales and the average selling price of homes in Orangeville. As prices have declined there has been a slowdown in listing activity which has allowed the amount of inventory available to normalize from the lows at the end of 2021 and the start of this year.
I am expecting the current market conditions to continue into the first quarter of the new year with stable inventory levels, declining prices, and very low sales activity. Beyond that, we will have to wait and see what happens in the economy and with interest rates going forward. I think the theme for the real estate market for 2023 will be how high will interest rates go and for how long will they stay there.
If you are looking to purchase a home while prices have declined the cost of borrowing has increased and despite lower prices, monthly mortgage payments remain quite high at current prices. Right now there is more inventory available and less competition for those homes so as a buyer you can be a little more patient and find the home that suits your needs. If you are purchasing a primary residence with a plan to stay in the home for the long term you can find some opportunities to purchase the right home for a fair price. If you are looking for a home or investment on a short-term basis there could be some downside risk for prices over the short term.
If you are thinking of selling your home there are some challenges in the market but knowing that from the outset will set you up for success. For a home to sell in this market the home needs to offer value to a buyer meaning that the price and condition of the home match and that when compared to other homes offered at the same price point your home stands out from the others. You need to work with a professional real estate agent who will invest in your listing to help you achieve the best results on the sale of your property.
If you would like to connect with me to discuss what is going on in the Orangeville real estate market or how any of this impacts your specific situation, please feel free to reach out or book a call through the link below.
https://calendly.com/brianrooneyrealestate
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