Listings (or lack thereof!) continue to be the dominant story in Ottawa real estate based on 3rd quarter results through the end of September.
Almost 3,000 fewer listings than at the same point only 2 years ago!
New listings in September are down 10.5% for residential properties and 20.3% for condos vs last year and 22.6% and 26.8% vs 2015.
Total listing inventory at month end is down this year 20.1% for residential listings and 24.1% for condos. Compared to 2015, listing inventory is down 35% for residential and 33.6% for condos. Combined this means the current market has a 2,922 fewer properties available for sale at the end of September than the same point in 2015.
Sales up, inventory down, scarcity looms
With total sales demand up 12.1% vs 2015 for residential and 24.6% for condos, it is easy to see how we are seeing average prices rise and more multiple offers.
Residential sales: price growth fuelled by demand
Unit sales were actually down 1.8% in September but average selling price was up 8.2% to $416,464. On a year to date basis, residential unit sales are up 6.6% and the average selling price is up 7.2% to $425,139.
Condo market continues to show strength:
2017 has been one of the best condo markets in many years with unit sales thus far up 23.5% and the average selling price up 4.6% at $272,220.
Sellers benefit in this market but of course, those who are also buying face a challenge on that end. One of the basic facts of real estate is that those who own a home are stuck both buying and selling in the same market conditions, so while one may gain on one side, they suffer on the other.
Buyers face more multiple offers, a very fast moving market on new listings and limited decision making time.
Builders have had a record year from anecdotal reports and we can certainly confirm that builder prices have been increasing and buyer incentives decreasing in the face of strong results and limited listing inventory in new construction also. Buyers are encouraged to keep an eye on new lot or phase releases or in demand inventory homes. Also take your Realtor with you to the sales centre and consider asking for a “hold” or “reservation” for a short time from the builder, if possible.(though builders may also be tightening up on their willingness to accept such good “faith” agreements)
Bottom line and what to expect:
Though mortgage rates are creeping up with the Bank of Canada recent rate changes and there are continuing steps to tighten mortgage qualifications, our market appears pretty solid and poised for more growth.
Investors are still trying to figure out how new rental rules from the provincial government may affect them, so we could see some slackening in demand from this sector as a result.
As long as the federal government does radically alter their headcount and spending plans going in to the latter half of their mandate, our local economy should continue to be fairly buoyant and allow us to continue with the positive real estate trend lines which have been strengthening for the last 18 months.
This could be the best fall and winter in the last decade to be listing a property, given all the foregoing, so sellers should be reasonably confident they can find a buyer even in our historically seasonal hibernation between mid-November and mid-February.
Buyers should keep a close eye on the market as there may be some off season listing gems hit the market from sellers who have been awaiting a new build completion and have to list in the off season to accommodate their move in plans.
Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
11th year in business as a lower commission brokerage