5 signs London is in the grip of real estate fever
We won't see a repeat of last year's real estate craziness, but it's still a seller's market
The snow is melting, the days are getting longer, the air is getting warmer and as we head into April, London real estate agents brace for their busy season.
And like spring itself, there are certain signs that this season is shaping up to be a busy one.
"I hate to say it but it's almost like sellers' revenge."- Robert DiLoreto
"The biggest sign is when you have so many buyers looking for houses," said Michelle Wright, a London realtor with Nu Vista Premiere Real Estate. "When I take a buyer to a house and there's a line up of agents with their clients trying to get in the house it makes it known it's a busy market"
Wright said she often encounters multiple offers on homes because there are so many buyers and so few sellers.
In fact, the number of homes for sale is well below the five-year average, according to data from the London St Thomas Association of realtors.
Last month, there were a mere 1,013 active listings on the Multiple Listings Service for London and St Thomas, which is 1.5 times below the five-year average for the month.
Robert DiLoreto, a London real estate broker with more than three decades in the business, said aside from Christmas, the market never really went into a winter slumber.
"It's been going on now since the first week, second week of January, continuing on from last year," DiLoreto said. "I consider it a supply and demand issue right, where the number of listings is really down, which is great for the sellers."
According to data from Royal LePage, 64 per cent of the homes sold in February had multiple offers and sold, on average $24,000 above asking price.
Last month, the average price of a home in London and St Thomas was $343,939, up 10.7 per cent from last year. In London alone, the average home fetched $353,180, up 12.3 per cent from last year.
"The people in London are the only people that felt that their property values were overpriced," he said. "When people were coming into the city and seeing one as big as London with what we have to offer, the hospitals, the university, the colleges, the businesses, they were saying 'jeez, the houses are really affordable compared to Kitchener, Burlington, Guelph, those areas."
DiLoreto said add the fact that interest rates are still historically low, high rates of existing home ownership and the fact rental rates aren't much cheaper than a mortgage, one could easily argue London isn't overpriced.
"I just think it's a great time for sellers and it's a difficult time for buyers," he said. "I hate to say it but it's almost like sellers' revenge."
"If you go back a few years ago, the buyers had all the power. There was a lot of listings and the buyers could choose which ones they wanted and sometimes made lower offers and sellers had to take lower prices offers."
"Today the buyers are on the other side of the fence," he said. "Hopefully more inventory will come on the market and help balance the market."