Home sales in Richmond for February, 2013 at 219 homes was a 33% improvement compared to the previous month. But, it was 32% lower than the sales registered a year ago in February, 2012. Home prices continued to drift down, and price discounting continued by motivated sellers trying to sell their properties. The supply of homes spiked up 12% compared to the previous month as more sellers put their homes on the market in anticipation of a better spring market.
The overall months-of-inventory (MOI) moved back up from 10.50 months to 12.27 due to the higher supply of homes. The housing market in Richmond leads the lower mainland in having the highest MOI. The Chinese New Year effect sellers were hoping never materialized. The busier viewing activities the past few weeks did not translate into a recovery in the housing market for Richmond.
Richmond real estate market outlook
The busy spring season is with us now. But, the large price gap between sellers’ asking prices and buyers willingness to buy, had resulted in lack luster sales. The standoff is expected to continue as most sellers are holding off making deep discounts to their prices. Homes that were sold were mainly those priced at or below their city assessment values.
The Chinese New Year effect proved to be a non-event for 2013. While viewing activities were reported to have increased significantly, actual sales were hard to come by.
More listings can be expected for Richmond in the coming weeks. The negative market sentiment and buyers holding off buying the next few months will continue to exert pressure on sellers. The current MOI at 12.27 months is expected to move higher to re-test last year’s height of 14.09 months in September, 2012. Richmond’s housing market will continue to suffer due to high inventory and below average sales. Further erosion in home prices in Richmond can be expected in the foreseeable future.
A housing market recovery in Richmond is best tracked by monitoring the MOI. Buyers should exercise caution when buying. The current housing market in Richmond is still trending down. Buying now should be mitigated at prices discounted deeply, and well below current prices.
Tough challenges for Richmond home sellers
The stand off between Sellers and Buyers will not be solved soon. The slow housing market in Richmond is expected to continue into next year. Motivated sellers who need to sell will bring homes prices down. The only way out for them to sell their homes is to lower their prices significantly to attract buyers. As home prices decline, buyers will stay on the side-line and wait for a suitable time to buy. Until the market stabalizes, the number of buyers willing to enter the market will be curtailed.
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