Tariffic Time to talk about Real Estate…see what I did there…

At the time I am writing this the tariffs haven’t been enacted yet however everyone believes it’s just a matter of time.  The question is always how much, how widespread and when.  This is not unlike 2020 just as COVID was starting.  The economy slowed, the interest rates were dropping, and the housing market came to a bit of a standstill as everyone waited to see what was going to happen.

Then about a year later the market was on fire. Interest rates were still down, houses were selling in crazy bidding wars and townhomes in Beamsville were selling for $900k+.  It is truly unbelievable if we hadn’t lived through it.  

All the talk about tariffs etc and the impact its having on the real estate market has a lot of similarities to the COVID market, however there are some differences.

First, people aren’t staying locked in the houses.  We are allowed to go outside and still live our lives unlike during COVID.  So that means we don’t have people scared to go into someone’s house to look at it.

Second, any government spending to help those impacted by the tariffs won’t be generic.  The government won’t be sending cheques to anyone and everyone like they did before.  This should lessen the impact on our economy and not create as much inflation as what we had coming out of COVID.

Ok, so what does that mean to you as a Buyer or Seller?

If you are a BUYER, this is the absolute best time to Buy.  If you remember those who bought at the start of the pandemic had a way lower purchase price but did have a bit higher interest rate.  Then what happened…prices went way up, and rates came down.  So, the lesson was that it is always better to pay a lower price because that never changes whereas the interest rates do change over time.  You can lock in your rate at any time, but you can’t undo your purchase price.  A lower purchase price (or starting point) is always better than a lower rate.  Every time.

Also, if you are a Buyer not only are the prices the lowest, they have been since before COVID, there is not as much competition right now.  That means we are not seeing too many bidding wars and there is still a good selection of properties on the market.  The only thing is that won’t last.  Other Buyers will start to realize this, and they will start entering the market driving up the prices and competition.

Ok, it sounds great if you’re a Buyer, what about if you are a Seller.  

If you’re thinking about Selling you need to do a few things right away.  Start right now decluttering your home and start to get things in order to sell it.  Have an agent you trust come over and give you some suggestions about what you can do to maximize your selling price.  Right now, Buyers are looking for the most updated, turn-key home they can afford.  Most buyers don’t have an extra $50k+ sitting around in their bank account outside their mortgage after they bough a new home.  So, there is little to no money left for renovations.  As a seller you need to be able to update your home in strategic ways to maximize your selling price while minimizing your investment.  I don’t want to see you invest $50k and only get $10k back.  It needs to be the other way around.

Next, you need to start to narrow down what you are looking for and where you want to be.  Understanding what you want will be key in this market.  Are you right-sizing to a home better suited for your current needs?  Are you a growing family and need more space? Etc.  This is really important as part of your discussion with your agent.

Then you need to decide do I sell first or buy first?

It’s an excellent question and it really depends on you to a large extent.  Are you really driven by the area you want to move to OR are you really looking for a very specific type of house/property.  If the area you want has very few houses that come for sale or if you are very specific about your new home (it must face SW, a bungalow, with a creek and fully renovated on 1+acres) then we definitely want to find your new home in your preferred area before we sell it.  If the area you want has houses that come for sale regularly and if you have a number of different home styles etc. that you like, then we may consider selling while you are looking.  It really is something that needs to be discussed and I would be happy to help you figure out what is best for you and your specific situation.

Also, when the market is changing, as long as you are selling and buying in the same time period it really doesn’t make a lot of difference.  If you sell high, you’re buying high.  If you sell low, you’re buying low.  It really does balance out.  Where it does make a difference is if you already own another property that you’re moving to (cottage for example) then you really should consider waiting until the market comes up a bit to put a bit more cash in your pockets.

When its time to Buy or Sell let me know and I would be happy to help.  My dream is helping you find yours.  Cheers!