Last month, the real estate market in Cambridge saw a notable change. There was an increase in the average sale price, but that was largely due to detached houses.
The market saw an 8% increase overall in the average sale price, but the breakdown reveals that the increase was really only seen in the detached homes category, which was up 11%. Townhomes were down 3% and apartments were down 8%.
The average sale price across all housing types was $859,403. For detached homes, it was $949,107, for attached homes it was $692,661 and for condos and apartments it was $529,992.
“Compared to last month, sales were down by 5% and inventory was up by 18%, which is normal for June,” says Trish Lewis, Sales Representative, GoWylde Team/ReMax. “Year over year, prices are up 11%. I do believe we will continue to see volatility in the market for the next year until inflation gets back to the 2% rate.”
On June 7th, the Bank of Canada ended its pause on interest rate hikes and increased the overnight rate by 25 basis points to 4.75%.
In other news, Canada’s unemployment rate for the month of May was announced on June 9th. It rose to 5.2, which isn’t a significant amount, but it is an indication that the economy is slowing. RBC is predicting that June unemployment will be up marginally to 5.3%, but that number won’t be announced until July 12th.
In May, inflation dropped significantly to 3.4%. “The amount of people quitting their jobs has decreased, and credit card debt and delinquency are up, which are all indicators that the economy is slowing,” she says.
The interest rates were increased by 25 basis points on July 12th, with the key interest rate now at 5%. This marks the tenth rate hike since March of 2022 and the next announcement is expected on September 6th. Most of the buyers who are actively looking right now will most likely have their interest rates locked in, assuming they have a pre-approval in place.
What’s the best course of action in times like these?
“Volatile times in the market can be a great time to upgrade, purchase your first home or buy an investment property. Prices are still down from the peak, but with the shortage of supply, they will likely be back where they were in the near future,” says the REALTOR®.
People who should not buy in this market are buyers who are looking to flip a home or those who feel they may want to move in the next year or two.
“However, if you are looking to stay in your home or in the same city for the next 5 years, it is a great opportunity to buy,” says Lewis. “Interest rates will come down, not to the ridiculously low pandemic rate but down from where they are right now. The banks are betting on this, which is why short-term interest rates are lower than long-term rates.”
For more information, or to contact real estate agents Mary Wylde and Trish Lewis, visit the GoWylde Team or call 519-826-7109.