The Molly & Claude Team

The Molly & Claude Team Realtors Ottawa, Royal LePageTeam Realty

Buying a home in a cooling market

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In the last few weeks the real estate market has shifted. As a result, there can actually be more buyers actively looking as some buyers may have shied away from the red hot market as they were not interested in overpaying as the result of a biding war.

Of course from the selling perspective, presentation, which has always been important is thus more important now. Plus, it may take a bit more time to sell your home. In a more balanced real estate market sellers must be realistic about the value of their home. Remember $100,000 over asking was not representative of the value of that home it spoke to the despair of the buyer. More here – yes, a Toronto Realtor’s contribution but he speaks more of the change in the market rather than specifics of the Toronto market.

Ottawa Real Estate News Release (OREB)
Ottawa’s May Residential Resales Underperform Expectations

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ottawa-real-estate-board-newsletter-presented-by-the-molly-&-claude-team-realtors

OTTAWA, June 3, 2022 –  Members of the Ottawa Real Estate Board sold 1,846 residential properties in May through the Board’s Multiple Listing Service® System, compared with 2,285 in May 2021, a decrease of 19 per cent. May’s sales included 1,384 in the residential-property class, down 22 per cent from a year ago, and 462 in the condominium-property category, a decrease of 11 per cent from May 2021. The five-year average for total unit sales in May is 2,031.

“With year-over-year resales declining in March and April, and now with this downward trend continuing into May, traditionally the highest performing month for resales, it is quite clear that Ottawa’s resale market is shifting away from the blazing pace of 2021,” states Ottawa Real Estate Board President Penny Torontow. “And if rising interest rates, cost of living, and inflation aren’t enough factors to cause a pullback, the powerful and deadly storm that brought our city to its knees last month has justifiably impacted the market as well.”

“Our data shows a sharp decline in new listings with a corresponding increase in cancelled/suspended listings on the MLS® System in the period following the storm. Overall, in May, however, there were 3,120 properties that entered the market. This is on par with last May and is 5% over the 5-year average. The result is an 18% increase in residential-class inventory. Meanwhile, there was a slight decline (0.4%) in condominium inventory, but this is not surprising since they have likely become an entry point for many first-time homebuyers due to the affordable price point.”

The average sale price for a condominium-class property in May was $472,920, an increase of 11 per cent from 2021, while the average sale price for a residential-class property was $802,393, increasing 8 per cent from a year ago. With year-to-date average sale prices at $824,276 for residential and $470,353 for condominiums, these values represent a 12 per cent increase over 2021 for both property classes.*

“Average prices, while still higher than 2021, are showing signs of adjusting to the pace of the market with a month-over-month decrease of 2% in both property classes. In April, we also saw a decline of 1-3%. In contrast, January to March experienced month-to-month increases ranging from 2% to 12%. This may be good news for Buyers, including the fact that the months of inventory have increased to 1.2 for residential and 1 month for condominiums. We are still a far cry away from a balanced market, but it finally seems to be moving in the right direction,” Torontow suggests.

“Additionally, another statistic that we see increasing is the cumulative days on market (CDOM), which is now 14 days, increasing from 11 days last May. CDOMs are typically between 30-60 days in a balanced market, and usually closer to that one-month mark in Ottawa. I mention this because we don’t want Sellers to panic if their homes aren’t selling as quickly as perhaps their neighbours’ properties did. Buyers will also have a little more breathing room if this trend continues.”

“But at the end of the day, each property for sale has its own hyper-local market factors (location, condition, other properties for sale in the same neighbourhood, etc.) that will affect the final sale price. If you want to know the most accurate price point to sell your home or what is the true market value of a home you are interested in, a licensed professional REALTOR® has the education and the experience with access to the most current market statistics and property information, to guide you into making the optimal decision for you and your budget.”

REALTORS® also help with finding rentals and vetting potential tenants. Since the beginning of the year, OREB Members assisted clients with renting 2,320 properties compared to 1,837 last year at this time.

* OREB cautions that the average sale price can be useful in establishing trends over time but should not be used as an indicator that specific properties have increased or decreased in value. The calculation of the average sale price is based on the total dollar volume of all properties sold. Price will vary from neighbourhood to neighbourhood.

Ottawa housing market to cool in 2022 but prices will rise: CMHC

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CTV News reports in a recent blog post that the Ottawa Real Estate market will cool in 2022.

Factors influencing this cooldown:
  • interest rate hikes;
    • with another one to come on June 1;
  • inflation rate at 6.8%;
    • partly caused by the effect of the war in Ukraine;
  • post pandemic return to normal life creating additional expenses;
  • effect of the new mortgage rules.
We’re still in a seller’s market, but things are headed to a more balanced market. Read more here at the CTV News blog post. Beyond that post, the following are links to other posts that provide additional information. Bank of Canada interest rate. Details about the inflation rate. Details on the current mortgage rules.

First-time home buyers

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I changed the title of this article featured in the sun from “what do you do if you can’t rely on family money to buy your first home“. In my mind the Sun loves shocking headlines. But in reality perhaps that is how the article needs to be titled. I didn’t realize the figure for relying on help from family money was so high: 30% for first-time buyers and 10% for others. In this article, Phil Soper, President of Royal LePage highlights alternatives to get you started. Some ideas better than others – or perhaps more suitable for some than others. But sometimes creativity is needed!

About Us

Molly Hoyle Sales Representative
Claude Jobin Représentant des ventes

E-Mail

claude@claudejobin.com




Phone / Address

Phone: 613.804.7979
1723 Carling Avenue
Ottawa, Ontario