My, oh my. Selling in Guelph has sure gotten interesting. The housing market right now is positively bonkers.It’s all so painfully reminiscent of the wild days of 2017. That year, we experienced a huge wave of in-migration of GTA Buyers. Most were represented by their local out-0f-area agents who knew next to nothing about Guelph home values, and didn’t even have access to Guelph MLS data. The result was a spike in house prices that was hard to believe.
Well, 2020 has found us back to the same kind of market conditions. For me, this time around it feels even more out of control.
The Market Today
Yes, competitions are “normal” again, and it’s a buying environment that proves extremely challenging for level-headed Buyers. Faced with the prospect of 1) putting in an offer with reasonable conditions, like financing or home inspections, and most likely losing; or, 2) going in with zero conditions, and having at least a shot at winning… people increasingly are opting to move forward with cash offers.
So, we’re again seeing basic due diligence thrown out the window. Remember how well that went in 2017 for the folks who “won” with cash offers, even though they actually needed to sell their own homes? What a fiasco. In many cases, by the time those Buyers had their own homes ready for sale, the market had dipped considerably. By mid-summer, a lot of people were looking at the prospect of either owning two homes, selling for far less than they thought and making up a mortgage shortfall, or walking away from deals and forfeiting deposits and risking litigation. What a mess that was.
That being said, as a Seller… what do you do right now. Is a market like this one of those moments in time that you shouldn’t pass up?
That really depends. The challenge is that Selling in Guelph right now isn’t the hard part. Assuming you have your home prepared well and that it’s priced properly, within a week you should be doing a Happy Dance around your kitchen table. Sold firm… probably for more than you ever imagined when you bought the place. Hooray!
But… then what? That’s the kicker and that’s what needs to be at the heart of any Guelph homeowner’s decision-making process right now.
Two Sides to a Hot Market
Here’s the rub. If you need to turn around and immediately buy back into this market, you may not find yourself as far ahead as you think. Yes, you’ll have made some terrific gains on the selling side, but you’re going to have to turn around and buy in the same market conditions. You’ll probably have to forego due diligence with an offer, and if your Buyer overpaid for your place it stands to reason you’ll be overpaying, too.
Who can truly profit in a market like this?
First, people who are not overly attached to their homes and see them purely as an investment. Those folks have something figured out that most people, myself included, will never get. They seize a moment like this because it makes financial sense. They adopt an, “I’ll figure it out,” mindset with regard to where they’ll land after the sale. Maybe they’ll crash with friends or relatives, or rent for a while… they’ll make it work. Then, they wait for the kinds of Buying opportunities that always pop up when an out of control market runs its course.
I don’t know a lot of people who fit this bill. It isn’t a reasonable strategy for most. Start with those of us who have school-aged kids. Just Selling in Guelph for big profits and “figuring it out” sounds like total chaos to this parent! I know that I couldn’t even consider doing this. But, there are people who can and do pull this off. I envy them.
Others who can do well right now are already committed to moving out of the city. Because of the skyrocketing cost of homes in Guelph, many have decided (or feel they’ve been forced) to look at other towns and cities where they can still achieve their home ownership goals. Increasingly, Guelph Home Buyers are looking west and north for more affordable alternatives. So, those selling in Guelph during a crazy market like this can take advantage of hot prices, if they are certain that things will be more balanced and where they’re heading.
Selling Off Rental Properties
Finally, investor owners who’ve got tenanted property and are on the fence about holding versus selling can do extremely well in a market like this. In a down market, it can sometimes be a challenge to sell tenanted properties. They don’t always show their best, and if a tenant wants to make the process a challenge, they sure can! But currently, Buyers are so desperate to find something that they’ll overlook anything, including a house that doesn’t show optimally. They’ll even consider closing dates that are further out, for example, to wait for a lease to expire and get vacant possession.
For those who aren’t in a position to sell right now, take heart! Yes, this is a crazy moment in time – but either it’s the right time for you and your family to sell… or it isn’t. A wild market like this doesn’t last forever, and sometimes the crash is pretty painful. It’s not all roses, that much I can promise you.
It’s good to remember that you make your equity gains over years, not months. Let’s say you’ll be selling in Guelph in six months. Could the prices be lower at that time than they are today? Yes, that’s definitely possible – but it also means what you’re buying will have dipped, too. Look, odds are high that you’ve done well in terms of equity gains on your home in Guelph. If you’re one of the people as outlined above who can truly benefit from whack-a-doodle markets like this, then have at it! Otherwise, keep calm and carry on. When the time is right, you’ll do just fine.
