It wasn’t too long ago that buyers had the upper hand in Ottawa, as we were saddled with excess listing inventory, flat sales and very low average price increases. It is looking like 2017 may be a whole new ball game though and we may be in the first stages of another seller’s market, which we have not had for at least 5 or 6 years.
2016 was a transition year:
Between 2013-15 we experienced a period of excess listing inventory which combined with flat sales and price increases, created a market favouring buyers in general. (Although some high demand urban neighbourhoods may not have experienced this quite as much)
Starting about a year ago, we have seen unit sales improve consistently and though prices have remained fairly flat until recently, the number of new listings and overall listing inventory has decreased steadily…a good sign!
Overall listing inventory right now: (early March 2017)
Our current available listing inventory is well below (20%) some peak levels experienced in 2015 and new listings continue to lag behind by approximately 10%. Unit sales improved in 2016 and currently seem to be improving further. As these trends continue, we end up with a supply/demand shift favouring sellers and more competition among buyers for fewer available listings.
“Chronic”, overpriced, stale or unique listings:
There is always a certain percentage of listings that fall in to this category and these lower demand listings are bypassed quickly by most buyers. Though these listings are shown in overall “available” listings totals, they are not in high demand, regardless of the improved overall environment.
One buyer example:
In doing a search for a current buyer, we found the following out of 31 listings that met their general specifications:
Chronic listings on the market for extended period: 9 listings or 29% (anything beyond 90 days we consider chronic which means either the property has a problem and/or is overpriced.)
Busy street or other location issue: 7 (this young family does not want a primary or secondary collector street)
Unique listing or one with an obvious issue: 5 (not looking for a fixer upper or one with has obvious resale challenges in future)
Total: 21/31 listings or 67.7% of available listings are not viable for this particular buyer couple, leaving only 10 properties to consider. So while there might seem to be a fair number of listings, there really is not for these customers.
As it turns out our buyers have submitted an offer on one of these properties but it looks like it will be their 2nd go round in a multiple offer situation, in as many weeks.
New listings sell fast:
The sell through of new listings at this time of year is 50% or more of new listings selling in less than 30 days, so buyers don’t have a lot of research and decision making time. Being prepared and having a well prioritized search can really help ensure one is ready to jump on new listings, as soon as they happen.
There is not a major shortage of overall listings (a la Toronto) but the demand for quality listings is improving and in many cases, greater relative to supply, so buyers and their representatives need to be on top of their game or someone else will beat them to the hot new listings hitting the market.
Having a Realtor buyer representative fully engaged in one’s search is even more critical at this busiest time of the year.
Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
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