In looking at the current milton and oakville ontario real estate market, it is important to have some historical perspective on things. The charts below give some of that perspective.
An unfortunate thing with statistical data is that it is often difficult to give a very simple label for the data presented, thus leading to the possibility of confusion of the reader. I will attempt to keep things as non-confusing as I can, so the message doesn’t get lost in the words.
The data in these charts covers the period from January 1st, 2002 to the present time. This is a good representation for the area, as the market really changed in both Milton and Oakville right before this due to the explosion in new construction. The data provided is for the entire area covered by the Oakville, Milton & District Real Estate Board; note that most activity in Georgetown is covered on the Toronto Real Estate Board, and most covered in Burlington is covered on the Hamilton-Burlington Real Estate Board.
The first chart is for the available listings at the end of each month, and the number of homes sold during that month.
The path of the lines in the chart above show some of the seasonality of the real estate market, however, what is really interesting and noteworthy is the couple of big spikes in the available listings in the second half of 2007 and 2008, without a corresponding bump in the number of houses sold. Is some of that discrepancy due to changes in interest rates? Here’s a monthly chart of posted 5-yr-mortgage-rates since 1973 to aid you in answering that question.
The next chart, below, shows the number of new listings coming on the market every month. This number is important as it reflects the confidence that sellers have in the market; if the market is weak, people will not sell unless they have to due to having purchased a new home, job transfer, divorce, etc.
The new listings chart clearly reflects the seasonality of the market throughout the year, as well as the overall increase in the number of houses in the area. In January 2002, for example, the 500 new listings that came on the market may have reflected 1.25% of all houses in the area, but the 575 new listings that came on the market in June 2009 may reflect only 0.75% of the houses in the area.
The next chart shows the absorption rate of the market, meaning how long it would take to run out of inventory of homes for sale if no other homes came on the market.
As noted in an earlier post, there are some general rules-of-thumb in the real estate market, when it comes to available properties. If there is less than a 20-week supply of homes available, the market is considered to be a Seller’s Market; between 20 & 28 weeks supply is considered to be a Balanced Market, and a supply more than 28 weeks is considered to be a Buyer’s Market. On that basis, you can see that we have spent very little time in a Balanced Market over the past 7.5 years, and for only 4 months have we been in a Buyer’s Market.
This is significant information given the current market activity; if it weren’t for the crazy-low interest rates we are enjoying, I believe that we would be in more of a Balanced Market, or maybe even a Buyer’s Market.
This final chart shows the data from which the above charts were compiled:
Would you like to know more about how to use this data to your benefit when planning to sell or buy a home? Give me a call at 905-208-7002 and we can set a time to get together and discuss it.
Milton Real Estate Update July 31, 2009 « miltonblog.ca and miltonblog.com
on Jul 31st, 2009
@ 10:28 am:
[...] local real estate market. If you’d like a longer-term view of what has been happening, see this recent post. And here’s a view of what has happened on a quarterly basis in the area covered by the [...]