The President of the Sarnia-Lambton Association of Realtors says the effects of high interest rates are slowing down the economy as a whole.
Speaking with Sarnia News Today, Rob Longo said they recorded the fewest number of property sales in over 10 years in September.
"We have certainly seen a slowdown through August and September," said Longo. "Sales activity is down quite a bit, [compared to] the last few years. Obviously 2020 and 2021 were accelerated years, so that was higher than normal activity. But, even based on a normalized chart, we are seeing lower than average activity through the last couple months. Obviously, that's from the rise of interest rates over the last year."
Only 98 properties changed hands and overall sales activity is now down six per cent year-to-date.
Longo said there is always a bit of a cycle in real estate.
"Obviously, this is a significant departure from that. We saw way above average highs through the previous two years and now we're seeing an above average slow down right now because of the exceptional interest rate," he said.
With inflation continuing its rise, Longo said there's no question the lack of sales is impacting the industry.
"Not just with realtors, but the people involved in each of those transactions. Locally, we have 325 realtors that work out of the Sarnia-Lambton Real Estate Board, and they generate over $300 million dollars in spinoff revenue every year," said Longo.
He said jobs are impacted in many different sectors.
"Whether it's moving companies, cleaners, house repairmen, and obviously, a whole different segment is the contractors with new homes and creations like that. So, it's really quite all encompassing when you slow down that housing market, it really slows down the whole economy," Longo said.
Homes took 23 days to sell in September, but pricing remained strong with homes selling for 97 per cent of their asking price.
"The median price has come down a bit. We've seen this year it seems to have settled right in at about $490,000, which we think is a good price point for our area," he said. "We still are quite a bit lower when you start to compare to other centres like London, Chatham and Windsor."
Buyers have much more to choose from with 465 active listings currently, 253 of which were new last month.