Ottawa’s resale residential real estate market is continuing to see adjustments and corrections stemming in part from rising interest rates, the Ottawa Real Estate Board says in its report on sales results for October.
While the average sale price for condominium properties in Ottawa was up 9% over October of 2021, the average sale price for a residential-class property was down 5% from last year, and the total number of transactions for the month was down, the Board says.
The average sale price for a condominium-class property in October was $445,691. That’s a 9% increase from prices in October of 2021.
The average sale price for a residential-class property in October was $677,873 _ a decrease of 5% from the average price in October of last year.
Members of the Ottawa Board in October sold 987 residential properties in October through the Board’s Multiple Listing Service (MLS) System. That’s down 41% from the number sold in October of last year. The five-year average for total October sales is 1,554.
“After the volatility of the past two pandemic years, which was unsustainable, the market is correcting and adjusting,” says Penny Torontow, President of the Ottawa Board.
“The slowdown is compounded by Bank of Canada interest rate increases, which further exacerbates buyer hesitancy and weakens people’s purchasing power _ especially first-time homebuyers,” she said.
If you are looking to purchase a property or planning to look soon, there was some good news in the October numbers.
Ottawa’s market, which experienced low inventory for much of the pandemic, saw 2,047 new listings in October. That’s up 4% from the number in October of last year and slightly above the five-year average for new listings.
The total inventory of houses and condos has been rising slowly but steadily in recent months, giving buyers more choice.
In 2021, there was just one month worth of inventory for residential-class properties. That has increased to 3.3 months (the time it would take to sell all properties if no new listings were added).
The Board says there’s also three months of inventory for condominium-class properties, up from 1.2 months in 2021.
“Demand is still high, and with increasing inventory available, buyers have more choices and time to shop for their new home,” Penny Torontow says, though she says some buyers are also deciding to hold off on buying as they wait to see where prices head.
For sellers concerned about price fluctuations, she says “as with any major investment, a longer-term perspective is important. The significant year-over-year gains of the last two years was not sustainable. If you have owned your property for any length of time, your equity has increased significantly and will buffer price corrections. No one can predict with absolute certainty what will happen next year, but in the highly employed and stable Ottawa market, real estate has been and will continue to be a good investment over time.”
While we “don’t have a crystal ball,” she says, “mortgage brokers and Realtors have the education, expertise _ and most importantly, the data _ to help people make an informed decision for their specific situation.”
The Real Estate Board cautions that while average sale prices for a specific month can be useful in establishing trends over time, they should not be used as an indicator that specific properties have increased or decreased in value. As with any city, prices in Ottawa will vary from neighbourhood to neighbourhood.
If you’re considering selling or buying property in Ottawa, I’d be happy to give you more information about the current market and conditions in your area of the city. With more than three decades of experience, I’ve helped clients in a wide range of market conditions.
You can read more about me at www.nancybenson.com. Feel free to give me a call, at 613-747-4747.
