Hey everybody! With 2022 in the books, we took some time to review last year, and how we fared in the Greater Sudbury Real Estate Market. If you haven’t read that blog post, I recommend giving a quick read!

 

Looking ahead to 2023, it’s time for me to make some predictions! Now, nobody has a crystal ball, and me least of all… What I am relying on here is my decade-plus of working in the Sudbury Real Estate Market, and my analysis of the market statistics of the recent past, to make educated guesses of what I think the future will hold! Some of these are fairly obvious, while other may be a little bolder!

 

As I want to get into enough detail with each of them, I have decided to break it down into a 4 part series. This will allow me to go into detail with my reasoning behind each prediction, and engage in discussion about them.

 

Only time will tell if I am right on any of them!

 

 

 

 

Ok… So I am being a little conservative here… I am 100% certain we will be at 300 active listings to end the year. I originally wanted to predict 350+ active listings, and I still think that could happen… But, I want my predictions to come true, and decided to be a little conservative here.

 

We noticed the number of active listings climb throughout 2022. Although the number of active listings has been slowly dropping since peaking most recently in 2014, the pandemic saw that drop accelerate to unprecedented lows. With downward pressures on demand, largely caused by high interest rates, and the other prediction of sales numbers dropping, we will see listings increase over time.

 

The X factor here that could cause this prediction to not come to fruition is the motivations of Sellers in 2023, and their willingness to adapt to market realities. I have seen many times sellers resistant to reducing their price, and the amount they would be willing to accept to sell their house. It can be a tough pill for many to swallow after witnessing the flurry of activity of recent years, and the prices their neighbours have been getting for their homes. Many may forego selling altogether, waiting for better market conditions.

 

How many sellers will let go in order to pursue their future plans, and capitalize on this downturn in the market for themselves. How many sellers will have to sell as their mortgage are due to reset? How many got in over their heads while rates were low, buying things on variable rate loans and lines of credit, and now their best option is to tap into the equity in their home and downsize to pay off debt? These are all the various questions I am hearing and reading from colleagues and through analysis from other industry experts.

 

While supply and demand will continue to dictate much of what will transpire in the real estate market, it’s fairly easy to predict the number of listings will continue to climb. The hard part is predicting by just how much… This could be mitigated by sellers adjusting their expectations, and coming to reality a bit as it relates to the value of their home. If enough sellers do, then we could see sales numbers higher than anticipated, and the increase in the number of listing be slower than anticipated.

 

Now, I have seen some analysis that indicates the number of active listing climb to 500 by year end, but I think that is a little too lofty of a number to be realistically attainable. I am sure we will see 500 active listings at some point in 2023, at the peak of spring market inventory levels. That number will come down though as things slow heading in to Q3/Q4, and we finish around 350 active listings. By the end of 2024, I wholeheartedly believe we will see active inventory consistently above 500 active listings, with spring market peaks around the mid-600s to 700.

 

I believe the days of 800-1100 listings on the market, based on market cycles, are now behind us. Where we used to see the boom/bust cycle run in roughly 7 year cycles, I see that time frame shortening to 5 years now. I also see the new norm of a balanced market here is when listings are in the 600-800 active listing range. I feel like this is sustainable, and will keep prices climbing over time, but at a healthy pace.

 

My advice to sellers - The worst thing you can do is try to time the market. I have seen far too many sellers say “I’m going to wait for the market to turn”, only to realize that it is taking longer than they expected, and they end up selling for less 12 to 18 months later. Be honest about what your goals are, come up with a (realistic) plan, and hire an experienced agent to guide you through on how to get it done.