Why I love real estate statistics
I love real estate statistics, not because I believe them. They are far too broad and general for that. I like real estate statistics because they show general trends. They are windows into my world. I often are interested in them to see how Kitchener-Waterloo is doing compared to GTA or Canada as a whole and I like to view my own activities and income against my colleagues in the industry.
And my world has changed. I often marvel about how much the job of a real estate agent has changed in my relatively short time as a Realtor. How I did my job ten years ago is almost completely different than today. Buyers are better informed and have a better idea of what they are looking for before they start looking. Home sellers are better informed too, but sadly some of their knowledge comes from HDTV. Also, some of home sellers knowledge comes from past experience, but like I mentioned above, the real estate game has changed so maybe home seller’s knowledge is out of date. I’ll save that thought for another blog post.
Some of the statistics below are from our neighbours south of the border and although Canadians and Americans are very different, in terms of real estate our systems seem to be the closest to each other than to any other country in the world.
Sales up, not down
So sales are doing better this year than were originally predicted. CREA, the Canadian Real Estate Association initially predicted the number of sales nationally to fall by 1.6% in 2019. But then in June revised that prediction to say that sales would actually increase by 1.2%. That’s an almost 3% difference, guys.
Home buying trends
It used to be that buying was easy and selling was hard. This year in Kitchener-Waterloo, at least in the under $600k price brackets, in some neighbourhoods, finding and buying a great house is proving difficult.
Some general statistics about home buying.
Ten weeks searching
The average buyer took ten weeks searching for a new home in 2018. To me this seems about right. I have clients who brought me in to help them purchase very late in the game and others who have been passively looking for months or years.
Days to closing
The average number of days waiting to close was 73 days. I’ve noticed that in the winter, the number of days to closing expands to 90 or 120 days and in the late spring it contracts to 30-60 days.
New vs resale
Brand new homes were purchased by 14% of buyers, while 86% of buyers bought resale homes. For me, about 10% of my business is working with brand new home buyers.
Saving for a down payment was cited by 13% of home buyers as the most difficult step to buying. For 58% of home buyers, the down payment came from their savings account. Interestingly, nearly 40% financed the purchase of their next home from the equity gained from their previous home.
- In 2018, 63% of home buyers were married. Additionally, 18% were single females, 9% were single males, and 8% were unmarried couples.
- 35.4% of homeowners are under 35 years of age.
- Millennials will account for 45% of mortgages
Home selling trends
Selling a home has changed a lot over the years. Photographs have been most important over the past 20 years. Listings need a lot of quality photography to sell a home quickly and for the most money. Video is becoming increasingly important too.
Here are some general statistics about home selling.
Not Monday, Thursday.
Thursday is the best day to list a home. Monday is the worst. Statistically, Homes listed on Thursday sell for $3,015 more.
Staged homes sell 25% faster than non-staged homes.
In the movies or on TV, the daily life of a Realtor is busy, often glamorous and a little hectic. In real life statistics show:
The work week
Nearly 50% of agents report working 40 hours or more a week and 22% report working less than 30.
Here, I think we have to define what ‘work’ means. Is blogging work? Are office meetings work? I used to think that the best and most successful agents lived and breathed real estate but I don’t think that’s true anymore. I think the best agent have processes that they follow – they work smart, not hard.
Sphere of influence
Referrals, according to statistics accounted for 17% of the average Realtors business. Returning clients accounted for 13%. I think the longer a Realtor is in business the higher these percentages will be, as long as the Realtor is doing a good job for his/her clients.
I don’t know any other industry that spends quite so much time, effort and money on marketing. Half the time money and effort I spend on marketing is completely wasted. I just don’t know which half.
- Most agents (62%), spend at least one hour a day on marketing.
- On average 31.5% of Realtors spend more than $400/month on real estate marketing
- Facebook is the go to social media site for the majority (almost 85%) of Realtors.