As the end of the year approaches, many homeowners are hesitant to list their properties for fear of not getting the best value for their home. However, selling at this time also has its advantages, less competition and more serious buyers.
James and Denny discuss real estate market trends and provide insight into why you may or may not want to list your home during the holiday season.
This episode will cover which months are usually the slowest in real estate, who could benefit from listing during the holidays, how the recent rate increases have affected list prices, the prevalence of multiple offer situations, and which property types are currently highest in demand.
Watch and listen to the Garbutt+Dumas Real Estate Podcast below and follow us on Spotify, iTunes & YouTube.
Read the Transcript Here
Hi everyone, I’m James Garbutt. And I’m Denny Dumas. And this is the Garbutt Dumas Real Estate Podcast.
Denny: At this time of year we have a lot of conversations with potential clients that are thinking about selling and the question is, do we speed up the process? Get photos next week? Get it up and running. Do we show, do open houses in December or do we wait for next spring? How do we answer that question?
James: Well, it depends Denny. It depends on every scenario. I mean, are the holidays a good time to list? Probably 80, 90% of the time, no. But there is a good argument for yes. So let’s, let’s kind of talk about the pros and cons of it.
Maybe, there’s certain product types that are doing better at this moment in time. But in normal season, in normal real estate cycles and markets, December is not the right time to list. The only advantage of listing December is that may be the only listing of your type available at that time and there’ll be a lot of eyes on it and any buyers that show up will be serious buyers, but does that mean that you’re going to have a better price and outcome?
I think 90% of the time when I look back at my career, I think you’re more likely to get a higher price in January and February. This year might be one of the exceptions. You know when, if there are a few more rate hike announcements coming down the pipe, there is a good argument say December might be a good time to list because, well, one, it could get worse or two, you could be putting yourself in a buying position if you sold today at a really opportune time in the new year when there’s more selection to look for.
Denny: December is historically the slowest month in our real estate year, both from a listing new listing perspective and also from active buyer perspective. A lot of Realtors take time off in December. It is just naturally a slow period for us and we try to take advantage. A lot of buyers take time off from even looking at real estate. So usually our suggestions are: December is a very slow month. We might get lucky if the right buyer is looking at this period. But January is also a very slow period, January-February for new listings and there seems to be more eyeballs on real estate. People get back into the swing of going to open houses and viewing properties and, and making time for that stuff in January-February. So usually that is one of the things we kind of push people towards.
But maybe I think it’s important to touch on like who is selling now? Who is selling this time of year? And usually that is the person that has been looking to upsize and the right house came available in November and they need to get their condo / townhouse ready to sell very quickly. So I think for the suggestions that we’re going to be sharing in this podcast this is more geared towards the individual that potentially is downsizing. Moving out of the city isn’t necessary, isn’t buying at the exact same time and then waiting for something to come up and the right property just came up but they’re more strategic sellers rather than, because the right property came up to buy that they need to sell now.
James: The upgrade or downgrade, like the person that is moving properties going from one property to another. Arguably the biggest thing that we tend to mention is well, I guess there’s a few things we should acknowledge: it’s mid November so if they were saying yes, let’s try to sell now. Let’s say we’d have them up on the market first week of December. If they’re up on the market first week of December, they’re likely looking at offers by second or third week of December, if all goes well. And they’re looking at offers then they’re likely looking at a February or March closing.
So one argument of selling sooner is one: you don’t have to sell by listing your property. Listing your property is an invitation to see if buyers exist out there that will pay you a price that you’ll be happy with. But if you did look at offers in December, there’s a chance you could be leaving some money on the table. But another alternative side of that, you are knowing how much your property is selling for going into January or February when there’s more listings that will hit the market and hopefully, hopefully you can make it up on the buy side.
The one big thing that I look at is what exists now that is suitable for you to buy and if it is nothing, it may not be a time to get aggressive to sell unless you just really value having the cash out and flexibility. You know if you want to put in other investments, that’s one thing but if you are simply looking to go from a townhouse to a house or condo to a townhouse or a house to a condo and there’s nothing that you like on the market right now. Well, keep in mind you’re relying on the moment you accept an offer, you have an end date to move out and you’re relying on something coming up that you like.
You can always move into an in between accommodation to cover yourself, if you have family even better, but you’re relying on a reasonable or good opportunity coming up. And one thing that we’re finding in this market is, if there’s a lot of products that you’re willing to move into, you’re more likely to get a market price at a good deal in this market for what it is. But if you are saying buying something that doesn’t exist, maybe it’s a detached home in a certain price point in a certain neighborhood. The next one that comes up might be overpriced, it might not be a motivated seller. It, you might find yourself by selling today you might find yourself looking for interim accommodations looking, moving twice and or potentially being out of the market for at a time where the market goes on a 10-20% run.
There’s a lot to consider Denny. It depends what if scenario, but I’d say for those that are selling today that live in the places they’re selling and are trying to upgrade or downsize. The buy side is very important and having options in the buy side need to be there.
Denny: If you make the decision to sell your home right now, what does the market look like right now? Are buyers active? Is there multiple offers with interest rates, climbing did all the buyers go away?
James: That’s a lot. They’re still there. They’re still there. I don’t, you know, we’re talking about people moving for lifestyle. There’s people sitting on vacant properties. You know, that’s a big part of it. You know you whether it’s an estate sale or you name it, the property became vacant, tenants moved out and you haven’t, you’re sitting on a vacant property. Right now is a market where I don’t see any reason to just let your property sit vacant for a few more months than try. It’s too uncertain with rate hikes to think that January-February is going to bring in a whole new world of prices. And you know if you’re sitting on a vacant property I wouldn’t say there’s no harm in trying, in terms of expectation of selling.
A Yaletown one bedroom might do better than a Brentwood one bedroom right now. There’s a lot more Brentwood condos but I’m not watching the Brentwood market as close so I might be eating my foot there but… Anmore luxury homes aren’t doing so hot, so don’t have high expectations there. And I think the further out in the Fraser Valley, the more likely they are to run into slower products. And there’s a lot of, say areas in Surrey that have ample townhouses that, that could be getting slow. So the areas that seem to be surprisingly busy: townhouses close to the city, for the most part.
James: I mean, you had an open house last weekend and that was pretty busy.
Denny: The common misconception and I think the media, this media driven is that everything is slow. And that’s just not the reality right now. The, the townhouses in the Tri Cities, in East Vancouver still very, very active. The upsiders type product to entry level homes in a lot of these neighborhoods are still very, very active. We’ve had four townhouse listings in the last six weeks. Each of the four got multiple offers. Last week, we had a East van townhouse that got 35 showings roughly. Had multiple offers.
James: That’s a lot!
Denny: That’s a lot of people coming through. Got multiple offers. So there’s still a lot of product types that are quite active. And when you say the word “multiple offers” right now it’s like a trigger thing for consumers. Like “Oh, well, I don’t want to compete. I don’t want to compete. Interest rates are up I shouldn’t be competing.”
The reality is like if you would like to buy this property, you have to work with the scenario that you that, we’re in. And multiple offers do look different though. And I think it’s important to kind of share this with, with consumers and with, with sellers.
First, there’s this thought process that if we get multiple offers, our place is gonna sell over asking and it’s going to be subject free. And it’s going to be exactly like it was in 2021.
James: It’s not February Denny!
Denny: Multiple offers is great. It gives you leverage, but just note that if you are selling a property right now and you get multiple offers, it doesn’t mean that subject free offers, deposit attached. It’s not the same scenario. In most of these, well, in these last four townhouses, all four of them. Each offer in those scenarios had subjects in them.
A lot of them, it depends a lot on the strategy of where you’re listing a property but a lot of them are still selling under asking slightly, with subjects. It’s just a different environment. So I think it’s important to like, preface that going into the listing right now if you, if you have something coming up for sale later in the year, early in the early in 2023, is just preparing sellers for the reality of today’s market versus what their neighbor sold for in February.
James: So, the holidays coming up. Is it a good time to list the argument? Arguably, a townhouse might be an exception, especially if you’re moving for, to a house there might be based on the success we’ve had lately. For the last four townhomes and we’ve been lucky this year over the last couple of years to be behind a lot of townhome sales. I was very shocked at one of the sale prices but I don’t know all four. Were they in line with prices that would have happened in February-March? Were they higher, lower?
Denny: Slightly lower. Yeah.
James: And higher than this time last year, arguably, or maybe around the same? Maybe around the same? Last fall was…
Denny: It could be higher than this time last year, to be honest. Yeah. I had a conversation with the same, as Jamie, I’ve had a few people reach out talking about investment properties. And one of the comments one of the people said to me the other day was “Well, I’m buying a property right now for .75 cents on the dollar.” I said “Where are you hearing this from?” because it, you know depending what you’re looking for, but in a lot of great American…
James: Must be American.
Denny: Yeah, maybe. In a lot of Greater Vancouver, the investment type property that a lot of people are looking for that we’re discussing here is, is like a one bedroom, two bedroom condo, potentially a townhome. And in a lot of these neighborhoods, we’re off peak pricing for those types of products, maybe five to 10%. 10% and kind of on the higher end and so to answer your question, is it the same price as I would have gotten February? I’d say like 5% lower it probably would have…
James: With the exception of Merano Lofts potentially. That one was pretty good price.
Denny: The Townhouse?
James: Yeah, the townhouse.
Denny: Yeah. That, I mean…
James: Maybe February was crazy though so…
Denny: You never know when you’re gonna get lucky right? When the right buyer exists at the right time for that specific product. And I think that one just… there was someone that was waiting two years or three years for that specific property to come up. And in those scenarios, you get a little bit lucky and you can’t predict whether that buyer exists until you try it.
James: And that property was awesome. You know, rooftop patio, five patios, right on the Quay, River. This is a place in New Westminster that we sold recently.
Denny: The seller did a phenomenal job of getting it ready to sell. It photographed extremely well. Yeah, the stars aligned for that one.
James: Before we go too deep on this tangent, maybe explain what cities were those four townhouses in.
Denny: There was two in New West, one in Port Moody, one in like, Southeast Vancouver.
James: So to put that in perspective, I don’t think we would see the same outcome in a lot of the Fraser Valley markets.
James: So this is specifically I mean, New West, is short on like, north of the Fraser River short on townhouses, Tri Cities short on townhouses, Vancouver, same story. So these are markets where families need a place to live and there’s just not enough entry level three bedrooms.
Denny: Exactly. And most of the people coming through specifically for this one last week are young couples. Young families that are looking to upsize lifestyle moves. This is not investors. This is not like overseas buyers. This is people that live in Greater Vancouver that are wanting more space.
James: You touched on offers, you touched on multiple offers. If this was earlier this year, when you hear multiple offers, you’d be thinking $100-$200,000 above list, subject free to have a chance. Now it’s very common to get multiple offers with every offer being below the list price, every offer having subjects, some of them maybe even have subject to sale. So
if you love a property, don’t shy away from it because of multiple offers. Doesn’t mean that it’s going to go well above. They are, there are still I remember I took a glance at say it was the detached house sales in New Westminster. And when I looked at it earlier this year, say March or April, the last 20 sales 19 of them were above list like, they they sold over asking and the shift is when I look at the last 20 sales now, I’d likely see the reverse of that one, maybe two of them sold above the list price, but 19 or 18 of them sold below.
So multiple offers still do happen but doesn’t always mean above list. Those are more uncommon, but they still happen. Maybe 5%-10% of the time.
Denny: From a buyer perspective. We do hear the comment of you know, I don’t want to compete. We hear that quite often. And my comment is always like, do you like the house? Yeah, we love it. Let’s figure out a number that makes sense and write an offer and if we don’t get it we move on. But the idea of not competing to me doesn’t really make sense for a property that you like. Figure out what market value is. Let’s write an offer at that and if we don’t get it, oh well.
But often in those scenarios, people still have this feeling that multiple offers are exactly like they were in February, where you have to write subject free and people still feel uncomfortable with that. So I think in, in changing markets is important to understand like, where property is listed, are they listed low on purpose to create multiple offers, and if they’re listed low on purpose, we may get a pretty good deal because a lot of consumers feel uncomfortable going over list price right now. Even though the market values above list price.
If you are taking our suggestions and you are, don’t need to sell right now and you’re waiting till spring, what, what things can you focus your time on to ensure that you have a successful sale in the spring?
James: And a big reason to hold off and you’re using spring here as an obvious example.
The, is to improve the look of your place. You know, when we’re walking in the presentation matters. The best sale outcomes we get the lucky the moments we get the luckiest with our sale prices or properties that are that show the best often.
So, I mean an obvious one is paint, you know it’s not in right now this time of year, probably inside, interior paint but look at everything that’s broken and fix it. Every light bulb you know, get make sure your lighting works, make sure your paint is good. Consider floors, if the floors are terrible this is, and you’re not selling till next year painting and floors are two items that probably have the highest returns I can think of. I don’t know if I’d be such a, I often don’t suggest people get into kitchen and bathroom renos and I was just because the price points higher. Unless you’re in the business here you’re kind of creating work for yourself. But paint and floors are often recommended.
And when the weather, when you do have those openings with the weather, it is important the outside looks good but if you did say wash your gutters now they’re probably going to get grimy by next spring. So the suggestion for next year leading up to your listing would be to focus on the outside but right now I’d be focusing on paint, floors making sure every door opens and closes, all your light fixtures work and just start chipping away at that list of repairs.
Denny: Yeah, focus on the interior. Do things that are going to help change the impression as people walk in the door. So paint, touch ups, things like that. The floors is a fantastic idea if if you can do it. Floors is for us, is a tricky one that you’ve got to move everything out of those rooms in it can be a bit invasive, but focusing on the interior fixing things that are broken. And a lot of times people do, will do renovations over years. They’ll like chip away at things. So if a renovation is 80% done or you know if you’ve, you know, if you’ve bought new appliances, a new fridge, a new stove, but you have a you know an old white dishwasher and everything else a stainless steel, it would make sense to spend that $1000 bucks, get a stainless steel dishwasher that matches the rest of the set to kind of finish that renovation.
James: But on that note if you have a stainless steel dishwasher, stainless steel fridge and an old kitchen don’t feel that you need to have all stainless steel, the kitchen’s old, right? This is just if you’re missing one piece of the puzzle to create, to change the overall feel.
Denny: Totally Yeah, and then, exactly like Jamie said, focus on the exterior when the weather gets a little nicer, closer to the listing because you’re gonna have to do it again, if you do it right now.
James: There are some scenarios where trying the market today might make sense, and there’s no, based on what the vibe that we’re getting, with a lot of products, there’s no indication that two months from now is going to be significantly different. You know, in most normal markets I would, we, and if you’re not in a rush, there’s a good argument just to wait and see. If you are buying something after you sell, maybe instead of testing the market November-December be first on in January.
January usually has more buyers, and if you are one of the lucky listings that is the only one of your kind that comes onto the market in January you could have a great outcome. There’s been many markets in the past where January February March sales were better than later in the year. And if you did sell in January, you’re putting yourself in a buying position in February, March and April which is a great time to have selection. And with the vibe that I’m getting for 2023, I think it’s going to as you know, as a whole, I think it’s still going to be slow before it gets better. So it could get slightly worse before it gets better. I’m guessing at the tail end of next year we’ll start seeing a turnaround but I have no clue what to expect in the first six months of next year.
I think spring is naturally going to be busier. Is that busyness going to hold at six plus percent prime rates if it gets there, you know we’re at 595. Let’s say it levels off at six and a quarter, six and a half. Hard to imagine how busy you can get at that level but I think it could. If it gets to eight I don’t know. You know I don’t, I don’t think it’ll get there but I’m not. I’m not the guy that pulls the trigger.
Denny: Yeah, I mean, looking at where inflation numbers are going, down, back to closer to normal rates or closer to what the Government of Canada is trying to achieve here. It seems like we’re near the end but, but our market is heavily dependent on what happens in the next few months.
James: Vancouver has gone against the world in the past, you know?
Denny: Totally, yeah.
James: Denny. How do people get clarity on whether to buy or sell today versus next year? What are the, what are they? What, where would they go?
Denny: I think the first step is to talk to a fantastic Realtor, our real estate team.
James: Oh, is this a moment to plug our sponsors?
Denny: Who’s our sponsor?
James: Well the Garbutt + Dumas Real Estate Team.
Any listeners that made it this far, we would love to work with you. You know, understanding the timing of when to sell and buy really is case by case. We like to look at the buy side. Oftentimes we have to bring clarity to the buy side. It can be, it can take a couple of months to get through this process. It can take a couple years, it can take a week. We can move fast, we can move slow, we are patient but we would love to hear from you if you are thinking of making a move.
Denny: A lot of people feel like they are bothering us or wasting our time if they are six to 12 months away from buying and selling. But it’s really important to have these conversations early and build a game plan.
Even if you’re a year away we would love to hear from you, we would love to kind of chat your situation through and make sure you are prepared for when the time comes.
James: We’re often right now offering, making suggestions on how to improve the value for next year too. So if this, just putting your home in a spot where it will have a great outcome on the market. If you need some help, suggestions, reach out. That’s it Denny.
Denny: That’s it. Thanks for listening.