The Pitfalls of Strategy in a Changing Market
When you’re strolling down a familiar pathway, it likely won’t take a lot of mental effort to get from A to B. You’re walking and talking while you take in the sites. Maybe you’re listening to music or a podcast. Afterall, you’re not too focussed on where to place your next step.
What happens when the ground beneath you starts to shift? Remember the Fun House at the local fair or carnival? The walls have wonky mirrors on them while the ground shifts left and right underneath you.
When the ground under your feet is moving, you have to choose your steps carefully. You will likely reach out for handrails and watch each step as you move forward. You’re also not likely engrossed in conversation. Afterall, your focus is currently on not falling on your face.
As is usually the case, this analogy applies to the real estate market as well.
If there is one thing you can set your watch to, it’s that the real estate market is going to change. Whenever the psychology of the participants changes, so too will the market. So, as world events or economics (large or small) or pandemics or other external events arrive, they will impact the mindset of all of us. That will in turn impact the overall real estate market.
Any market runs on trust, faith and confidence which determine the overall stability. Reduce or increase any of those elements and you’ll find a market that changes in one direction or the other.
Here we are in mid-June 2021. We just finished up an epic, record-setting 3 month run from March through the majority of May.
How epic? April 2021, a lockdown month, posted the highest number of monthly sales in Niagara real history. And that is for any month. March 2021 posted the 2nd highest. And May the 5th highest.
The market can only fly at that altitude for so long before it returns to some form of normal which is exactly what we saw happen in the back half of May and here into June.
Instead of 48 showings and 16 offers we’re seeing 16 showings and 2 offers.
Has that impacted sale prices? Interestingly enough, the average sale pricing has stabilized and kept it’s pace in spite of the froth of the market largely dissipating.
What does this have to do with a carnival fun house?
When the market dynamics change, you have to reach out for a handrail and make sure your next step is a safe one. Applying the same strategy or taking the same steps that you took a few months ago may lead to you tripping up.
It may lead to you getting 15 offers on your home but none of them are at the price you actually wanted.
It may lead to you getting no offers because people saw your asking price and made assumptions that you wanted a lot higher than you actually do.
The market doesn’t exactly have wonky mirrors at the moment, but careful steps are definitely a good idea these days.
Want to take moving floors and fun house mirrors and our local market? Contact us anytime.
Thank-you for visiting.