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One of the most common questions I have been asked this year is “When is the bubble going to burst?”
If you can imagine one level deeper than desperate, that would be a great way of describing our inventory levels back in April. We saw over 1,000+ units listed for sale in the Kitchener/Waterloo Market for the second month in a row (June/July). With this sudden supply boom we are seeing prices up over last year (in the range of 19-29% depending on what you read). In April, we had prices up 39-49% so the gains are gone.
Kitchener President James Craig said “June is the fourth consecutive month home sales in the Kitchener-Waterloo area have exceeded 700 units. Historically sales in KW and area have only ever surpassed the 700 unit threshold in a single month three previous times.”
Similar Market Conditions in Cambridge
Cambridge President Jim Robinson said “Sales continue to run at near-record levels, and it appears the market may finally be seeing a bit of relief with new listings continuing to rise,” and “That said, market conditions have been measured in weeks of inventory rather than months since last fall, and that remains the case.”
The average price for a single family home is up 29.2% from last year so it looks like we are back to a healthy normal market. Remember, we are used to 4-6% returns per year, not 40-50%. The bubble didn't burst, the market just corrected. The bad news is rates are going up!
Happy House Hunting!