The strong seller’s market in Prince Edward County continued in December - for how long depends on second wave Covid-19 lockdowns impact on incomes.
Fueled by continuing demand from Toronto buyers, home sales continued at a record pace during December. Home sales in the County are seasonal and always fall off in December, but this year’s December sales were almost double the previous year.
The supply of existing homes for sale remained at an all-time low in December with less than 50 listings available at the end of December. Put differently, the number of homes available for sale at the end of December was down 75% from a year earlier.
Months of inventory – the number of listings divided by sales for the month– is a good indicator of the balance of supply and demand. There are typically 10 months of inventory in December in the County, but this year it was 1.5 months. The strong seller’s market continues.
Selling for Listing Price or More
Under normal market conditions in the County, 10-20% of homes sell for listing price or more. However, demonstrating once again that the seller’s market continued, 45% of home sold at or above asking price during December 2020.
Time to Sell
With a population of 25,000, Prince Edward County is a small market where homes normally don’t sell as fast as they do in large urban areas. However, during December 2020 almost 30% sold during the first week listed, almost double the level of a year earlier.
Selling prices provide yet more proof that the seller’s market continued. The raw numbers show that the median price for homes sold during December 2020 was up 55% compared to a year earlier, but month-to-month comparisons are not that reliable. Quarterly prices provide a more valid measure and in this case the 4th quarter median price was up 29% from the same time in 2019.
Every indicator showed that the strong seller’s market continued from the summer and early fall continued into December.
Whether the seller’s market will continue into the new year is an open question.
If anything, the second wave of Covid-19 will likely mean even more people want to escape the big city for a safer place in rural Ontario.
Many of the people who are looking to escape to the County are knowledge workers and professionals who can carry on their careers working remotely.
To date, incomes for such knowledge workers and professionals have been relatively unaffected by the pandemic. If they continue unscathed, the seller’s market is likely to carry on in the new year.
On the other hand, if there’s a more general economic slowdown triggered by the second lockdown, this source of demand which has been fueling the seller’s market could dry up.
Image Credit: Getty/iStock
Treat Hull spent three decades as a management consultant and marketing executive before moving to the County and taking up real estate. He is broker/owner of Treat Hull & Associates Ltd., a Prince Edward County brokerage which takes no listings and represents only buyers.