'Reduced price' listings pop up in Hamilton's cooling housing market
'The market has changed; the landscape has changed': Local broker
As the Hamilton housing market's fever continues to break, "reduced price" and "new price" listings are popping up from realtors around Hamilton.
A listing for a house a block from Locke Street South in the Kirkendall neighbourhood screams, "JUST REDUCED!!" The two-bedroom fixer-upper was listed for $499,900 but has seen its price drop to $449,900.
A tweet for another house in West Hamilton teased: "New price improvement coming tomorrow." A four-bedroom house in rural Flamborough announces: "HOT NEW PRICE!" and has dropped from $599,900 to $579,000.
Agent Joe Capostagno recently dropped the asking price on a four-bedroom house near Rymal Road from $799,888 to an "Incredible New Price $649,900!!!!"
Capostagno said he'd found comparable sales from the spring that justified asking that higher price, but things had changed by the time the home went up for sale towards the beginning of July.
But the dramatic price drop caught buyers' attention, and one apparently thought Capostagno's clients swung too far.
It just sold for $725,000, more than the new asking price, he was delighted to say Tuesday.
'The market has changed; the landscape has changed'
Realtors tend to be an always-sunny lot, and not all who've dropped asking prices were willing to talk to a reporter about it.
But the ones who did all agree that the era is gone of blind bidding, paying more than $100,000 over asking price and forgoing all conditions in Hamilton's housing market. There's less competition by buyers in general, but especially for fixer-uppers that might have still attracted a fistful of generous offers back in the frenzy days.
"The market has changed; the landscape has changed," Doug Tunis, the broker and manager of more than 300 realtors at of Royal LePage State Realty.
But not everyone has adjusted their expectations.
Most market-watchers peg April and May as the time when things started to cool. The provincial government stepped in with some measures aimed at cooling the housing market in Toronto and surrounding cities. And evidence that the market is not quite as hot is mounting: A spike in listings in May, 20-per-cent year-over-year drops in sales in June and July.
And now, some dropping asking prices.
The learning curve for sellers
Tunis said the learning curve a couple of years ago was for buyers – agents would take them through a couple of unsuccessful bidding wars and they would realize how competitive it was.
Now, he said, the learning curve is for sellers, who think their realtor's price is way off-base – on the low side.
"They're saying, 'My friends, my neighbour, he had 17 offers and he was listed at $899,000 and now you want to list mine at $799,000 and test the market?!'" Tunis said.
But if that friend listed six or even three months ago, things have changed since then, he said.
Prices are still higher compared to a year ago, but a shorter-term comparison shows they've slipped since the spring heat.
The total number of sales were down in July, but the homes that sold that month went for prices that were 25 per cent higher than July 2016, the Teranet Home Price Index showed Monday.
But it's a different story compared to extremely busy days in the first few months of this year.
The median price of all home types sold in April, $509,900, was 11.2 per cent higher than the median price of the homes sold in July.
'We have a bit of an adjustment to make'
"We have a bit of a adjustment to make coming off of this frothy market," said Donna Bacher, past president of the local realtors association.
"There's less competition for the fixer-uppers," she said. "People are less willing to go crazy and pay anything for that. (Buyers) are able to put in conditions, and sellers aren't being rewarded for deferred maintenance – which we were seeing a lot of."
But then again, she said, it may be too early to tell what's happening in the market as July and August are often months when people go to the cottage, or wait to put their home on the market.
"Househunting isn't at the forefront, she said. "Summer is short and sweet."