Is 2024 a good time to sell your house?

The new year has barely begun, and many homeowners are asking themselves if 2024 will be a good time to sell their homes. It's a legitimate question, but the answer depends on several factors.

In our predictions for 2024, we take a look at all the factors that could affect the Quebec market that year. This time, let's take a look at what sellers are likely to be most interested in. You'll be in a better position to decide whether to move forward with your sales project next year or wait a little longer.

A more dynamic housing market in 2024

Admittedly, 2023 wasn't the most active year on the Quebec real estate market, weighed down by the effects of rising interest rates that dampened buyer enthusiasm. In 2024, however, the market should be more buoyant, bringing a glimmer of hope.

Among other things, a drop in interest rates, which many are eagerly anticipating, could lead to increased competition among buyers looking for their next property. This could be a good opportunity for sellers looking to unload their properties.

As for the number of transactions, some experts are expecting a higher volume than last year. However, according to Dominic St-Pierre, Royal LePage's vice-president and general manager for the Quebec region, in an article in La Presse (in French only), the activity will not be comparable to the exuberance that marked 2021 and 2022, which were years of record on many levels.

The Association professionnelle des courtiers immobiliers du Québec (APCIQ) predicts a stable market with a level of activity comparable to that of 2023.

Although actual market trends are still uncertain, the market will undoubtedly be more balanced than in recent years.

Rising demand and lower interest rates

While the Bank of Canada retains the option of raising its interest rate, the majority of economists and market experts across the country agree that a rate cut is likely this year.

Some optimists are predicting a cut as early as this spring. This is the case with the Mouvement Desjardins, which predicts that the first cut could come as early as April 2024. According to the same forecasts, the policy interest rate could fall from 5% to 3.5% by the end of the year.

Whether or not these predictions come true, a decline in the policy interest rate, and therefore mortgage rates, could also lead to an increase in demand from potential buyers. Indeed, many potential buyers are waiting for the right time to take out a mortgage at a lower cost.

Since supply and demand are two key factors to consider when determining the right time to sell your home, an increase in demand could turn into an opportunity for your sales project. You'll be at an even greater advantage if the inventory of available properties in your area is low.

Will house prices fall in 2024?

Although some properties have fallen in price in some areas of the province, the market is largely stable. In terms of future trends, this stability should continue.

Most scenarios have also ruled out the possibility of a real estate recession that would cause home values to plummet. Instead, some market observers are even predicting a slight increase in prices.

This is the case with Royal LePage, which predicts that lower interest rates could lead to a 5.5% increase in home prices nationwide in 2024. This increase is expected to occur primarily in the second half of the year, particularly in the fourth quarter.

According to the same forecasts, the median price of a property in the Greater Montreal area is expected to increase by 5% compared to the fourth quarter of 2023, to $610,260. More specifically, the median price of a detached single-family home could increase by 4.5% and that of a condominium by 6%. 

However, all experts do not agree on these growth projections.

In the meantime, several factors could contribute to rising or falling home prices, including buyer demand and future economic conditions. However, property values are likely to remain stable due to the lack of housing inventory on the market.

Will there be a lot of sellers in the market this year?

Many fiscal and financial factors could influence the number of sellers in the market throughout the year. Therefore, it will be necessary to keep a close eye on economic and real estate news in the coming months. One issue to watch is the ability of homeowners to repay their mortgages.

According to the Canada Mortgage and Housing Corporation (CMHC), just under half of all mortgages will come up for renewal in the next two years. With much higher interest rates, average monthly payments could increase by 30% to 40%.

Homeowners whose finances are not strong enough to withstand the financial shock may be tempted to sell their homes and buy less expensive ones. This could increase the supply of homes on the market. And more supply also means more competition for sellers and slightly less favourable terms.

This rebalancing of supply in the resale market, should it occur, would be "very modest," according to Desjardins' chief economist. As a result, it's a safe bet that the market will remain a seller's market, especially given the general shortage of properties.

Should I sell my house now or wait until next year?

There's no absolute answer to that question. The decision to sell or delay depends on many factors that you need to analyze, including your goals, your situation, and market conditions.

To help you determine whether 2024 is the right time to put your property up for sale, here are some points to consider:

• Your financial situation. If you need cash or your financial situation makes it difficult to pay your mortgage, you may decide to sell.
• Long-term plans. If you've already planned to move or retire in a few years, it may make more sense to delay the sale to synchronize it with your other life projects.
• Supply and demand. Your distribution can affect the ease with which you find a potential buyer. If there is little demand and lots of supply, it's probably better to postpone your project. Conversely, high demand and low supply would be to your advantage.
• Interest rates. Low-interest rates generally encourage buyers to purchase. If you need to buy another property at the same time as your sale, this is also a good time.

Looking to buy or sell a home in 2024?

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