Ottawa's hot housing market cooled, but not frozen, by COVID-19
Sales down 70% but some buyers, sellers forge ahead
Ottawa's hot housing market was off to a prosperous start this year. Then came the coronavirus.
But while the pandemic has definitely put a damper on things, some homebuyers continue to buy, and some sellers continue to sell. Here's how they're doing it.
Don Collins is trying to sell his four-bedroom, 2,400-square-foot bungalow in Carp before moving to a new home in Manotick.
He put the house on the market just before the COVID-19 crisis, and is asking $779,000. There were a few showings earlier in March, but those have now dried up. He's had no offers, but he's not panicking. He hasn't lowered his price.
Collins believes the bungalow, with an in-law suite on the main floor and another unit in the basement, would be perfect for families hoping to get elderly relatives out of long-term care homes, where the virus has taken hold.
"We're close to Almonte, and all I can think of is the people in the rest homes," he said. "We're not in a rush to sell, but I think the house is of value to somebody."
Collins said he hasn't decided on his next move, and the uncertainty surrounding the pandemic isn't helping.
"Leave it on the market or take it off? At the end of the day, nobody knows where we're going to be in six months."
That uncertainty is keeping many people out of the market at a time of year that's traditionally the busiest. But not everyone is lying low.
It is a little bananas to be doing it during this time.- Trinh Yogaratnam
Trinh Yogaratnam and her husband had planned to list their semi-detatched home in Old Ottawa South at the end of March. They'd already purchased a new home in the Glebe with an August close date. Then COVID-19 struck.
"We decided maybe we should just hold off. But then … we realized that it wasn't just a pandemic. It might be a deep recession," she said.
Yogaratban said their realtor, Shan Cappuccino, told them the market was "still quite buoyant," so the couple decided to go ahead.
The house was listed April 14. The family moved into an Airbnb rental for a week while their realtor held showings — following strict physical distancing protocols, of course. Prospective buyers could also take a virtual tour.
"We got offers," Yogaratnam said. "We actually got six offers."
The house sold April 21 for more than their asking price, with no conditions.
"I was shocked. I was pleasantly surprised," Yogaratnam said. "We were reading all the articles leading up to it seeing how the real estate market was kind of tanking and how home sales were decreasing. I realized very quickly that when you say home sales, it's not synonymous with home prices."
She said they have no regrets about forging ahead.
"It is a little bananas to be doing it during this time," she said. "But on the other hand, there are still people looking. Some of the people that made offers on our place had already sold theirs. So there was desperation on their part to buy as well as [on] our part to sell."
"At the beginning, it was a complete shutdown," said Ottawa realtor Gloria Yankowich.
But now, six weeks in, things are starting to change, she said, as buyers, sellers and agents figure out creative ways to mitigate their risk through virtual tours and conditional sales.
I don't know how many of us in the past have bought a house sight unseen, but it is happening.- Gloria Yankowich, realtor
"I don't know how many of us in the past have bought a house sight unseen, but it is happening," Yankowich said.
According to realtor Paddy McCarthy, agents have been deemed essential so people can avoid "financial catastrophe."
"Most people don't want to [list], but there are people who don't have a choice," he said. "In February, we might have received seven offers on a place. Now there's only two or three, but they're still selling."
Nevertheless, realtors know there could be lean times ahead, especially if the slowdown lingers into the summer.
"We work in a high-risk, high-reward industry," McCarthy said. "There will be a lot of realtors leaving the industry if they haven't set aside enough [savings] to weather this storm."
Realtor Peggy Blair said she's also encountering clients who simply don't have a choice.
"I've met two people this week who are paramedics who are starting with the City of Ottawa, moving here from other centres. They have to find places to live," she said.
Blair points out the Ottawa real estate market was "superheated" right up until the pandemic.
"We were already in a situation of … unprecedented tight inventory. It's simply gotten tighter because people who don't have to sell are not selling."
And don't expect a COVID-19 discount, Blair warned.
"I have some prospective buyers ... who have been sitting on the fence hoping that there will be bargains out there, and I have to keep telling them at this point there are no bargains," she said. "I was involved in a multiple offer situation on Friday. That property sold for … $42,000 over asking. They had 12 offers. Pre-March 15, they probably would have had 30 offers."
Blair was able to find a house for those paramedics. "They're actually moving in this weekend," she said.
Listings have "definitely dropped to a trickle," said Deborah Burgoyne, president of the Ottawa Real Estate Board. "Some people are actively out there trading, but I would say the majority of them are not."
It's not a feeding frenzy the way it was.- Deborah Burgoyne
Burgoyne said the year was off to a great start before the pandemic.
"We had surpassed last year's numbers, and then starting the third and fourth week of March we started to decrease. And the first two weeks of April, we're significantly lower."
Burgoyne said despite that, she's not surprised some people are still buying homes.
"There was a real pent-up demand. There were a lot of people that couldn't get into the market. They were pursuing multiple properties and losing out for one reason or another."
The pandemic might actually help some families looking to buy, Burgoyne said. "You know what? Maybe I'll have a chance because there won't be 10 people pursuing this property. There will be three."
That's likely to continue the longer the pandemic goes on.
"If you're priced at market value, I still believe you're going to have a good return," she said. "It's not a feeding frenzy the way it was."