How is it that Ottawa’s home prices are still rising, even during this shutdown?! In short, we’re a government city, with strong employment, a strong tech sector, and with tons of immigration coming in every year.
Here’s what’s happening in the market: prices are still rising, but sales volume is down. One of the reasons for this is listing inventory levels are still quite low so there really isn’t much to sell (which also forces prices higher).
Compared to the month of May last year, average condo prices up 15.5%, and average freehold prices up 11.2%. Yep, homes are still in high demand. Here’s what the Ottawa Real Estate Board had to say:
AVERAGE HOME PRICES:
May’s average sale price for a condominium-class property was $343,589, an increase of 15.5 per cent from this time last year while the average sale price of a residential-class property was $548,140, an increase of 11.2 per cent from a year ago. With year-to-date average sale prices at $546,177 for residential and $348,458 for condominiums, these values represent a 13.8 per cent and 17.8 percent increase over 2019, respectively.*
TOTAL SALES VOLUME:
Ottawa Real Estate Board sold 1,345 residential properties in May, compared with 2,410 in May 2019, a decrease of 44 per cent. May’s sales included 1,066 in the residential-property class, down 43 per cent from a year ago, and 279 in the condominium-property category, a decrease of 49 per cent from May 2019.
What’s going to happen in the near & distant future?
Expect the market to continue to climb, but a little more gradually than last year (I’m guessing around 4 to 6% for this year). Next year, I expect it’ll heat up again, with the more affordable freehold homes leading the way. Keep in mind that all properties and locations are umique and will perform differently.
In a strange move by CMHC (Canadian mortgage insurer), they’ve recently made changes to their qualifying terms. In other words, they just made it harder for buyers to qualify for a mortgage (especially for 1st-time homebuyers). For those hoping to get into the market with 5% down payment, best to consult with your mortgage broker to find out how to navigate the new rules. More info on CMHC rule changes here.
Good news though, Genworth (another mortgage insurer) has decided not to follow suit, and they’re keeping their existing terms in place. More info on Genworth here.
That’s it for my rant for this month. If anyone has questions about any housing-related matters, I’m always happy to help. This is a time for education and for understanding the market conditions. If you need guidance on any real estate decisions, that’s what I’m here for 🙂
Sales Representative. Residential & Commercial.
Capital Homes Realty
217-1419 Carling Ave, Ottawa, ON
Cel: 613 262 1697
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