The official numbers for 2022 are in, and average sale prices for residential properties and condo units in Ottawa were up 7 and 8 % over 2021 prices, despite the cooling market in the second half of the year.
The average sale price for a residential-class property in Ottawa in 2022 was $769,623. That’s an increase of 7% over the average in 2021, the Ottawa Real Estate Board reports.
The average sale for price for a condominium property in 2022, meanwhile, was $453,770 _ an increase of 8% over the previous year.
Those prices represent the average for the entire year. It was a year that started off with a hot sellers’ market and frequent bidding wars between buyers, which kept prices high early in 2022.
The second half of the year saw the market cool off as a result of rising interest rates, stemming partly from moves from the Bank of Canada to try to control inflation. Average sale prices started to also cool each month.
Ottawa’s sales numbers for the month of December of 2022 are more typical of the current market.
Average sale prices in December were $434,973 for condo-class properties (up 9% from December of 2021); and $655,839 for residential-class properties (down 7% from December of 2021).
The total number of residential property sales in December, at 601, was down 30% from the 857 properties sold in December of 2021.
“Even with the normal seasonal slowdown, December’s performance was in stark contrast to the very active resale market that opened 2022,” says Ken Dekker, President of the Ottawa Real Estate Board.
“As interest rates and inflation both climbed, buyers retreated to the sidelines and began taking a wait-and-see approach. However, while it’s quieter than the frantic pace we experienced in 2021, it is now a balanced market,” he says.
If You’re Buying:
That balanced market (meaning that demand from buyers is about equal to the supply), is good news if you are considering buying property in coming months.
For much of the past few years, Ottawa buyers faced an intensely competitive market, with limited supply. Many buyers felt pressured to make instant decisions on putting in an offer and to drop traditional conditions, such as a pre-inspection of a property.
The Real Estate Board says the number of months of inventory for residential-class properties (the time it would take to sell existing inventory if no new properties were added) has increased from 0.9 months in December of 2021 to 3.7 months.
For condo properties, that’s gone from 0.9 months in December of 2021 to 3.9 months’ worth.
That means buyers can take a breath and take some time in their search without feeling pressured into instant decisions. In a balanced market, sellers will also generally be more likely to accept a reasonable offer close to the list price.
As well, although interest rates are slightly higher than where they were a year ago, keep in mind that average sale prices are also lower than where they were in the early months of 2022, when the market reached a peak.
If You’re Selling:
If you’re considering selling property in Ottawa, there is no reason to panic about a cooling market.
If, like many of my long-time clients, you have been living in your property for many years, you’re still likely to make a good return on your investment thanks to the steady increases in sale prices we have seen over the past decade.
Even if you only look back to 2018, the average sale price in Ottawa for a residential-class property that year was $446,661. In December of 2022, it was $655,839.
In 2018, the average sale price for a condominium-class property in Ottawa was $278,316. In December of 2022, it was $434,973.
It’s true that as with other Canadian cities, the market has cooled in recent months from the hot early months of 2022. But Ottawa’s economy is known for its strength and stability, thanks partly to stable employment in government and other sectors, resulting in a steady stream of buyers coming to our region.
I work regularly with buyers who have been transferred to Ottawa to work for Foreign Affairs, the RCMP, the Department of National Defence and the high-tech sectors, for example.
But as with any market, it’s important to set a list price that reflects the current market. To help do that, I can show you the most recent sales prices for similar properties in your area.
As always, the Real Estate Board cautions that while average sale prices 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 by neighbourhood.
If you’re considering buying or selling property in Ottawa, I would love to hear from you. I’d be happy to give you more detail about the current Ottawa market and conditions in your area of the city.
With more than 30 years of experience assisting buyers and sellers and negotiating on their behalf in a wide range of markets, I know the city and its neighbourhoods well.
You can read more about me on my site, www.nancybenson.com . Feel free to give me a call, at 613-747-4747.
Best wishes for 2023, everyone!