Ottawa housing market normalizing — but still pretty hot
Resale market performing similar to typical pre-pandemic June, says Ottawa Real Estate Board
People looking to buy a home in Ottawa say the housing market is still red hot despite the city's real estate board seeing signs of a temporary cool down.
Earlier this week, the Ottawa Real Estate Board released a report saying June's resale market performed similar to a typical pre-pandemic June.
Board president Debra Wright says the market is showing signs of balance.
"Prices are staying about the same." Wright said. "So far, we've seen no decline in prices but we're not seeing the volatility that we were seeing before."
'This is still a very hot market'
The real estate board's report says the average price of a condo in June was $435,198, an increase of 21 per cent from 2020. The average sale price for a residential property was $725,970, an increase of 26 per cent from a year ago.
The board said those prices have not seen nearly the same increase from one month to the next as earlier in the year, which is a sign prices are levelling off, according to Wright.
Ben Rabidoux of Edge Realty Analytics says he agrees the market is normalizing, but from an artificial and unsustainable peak in the first quarter of 2021.
"It feels like you've gone from 150 kilometres down to ... 100 km/h. This is still a very hot market that is just not conducive to affordability," said Rabidoux.
With limited inventory and a market that leans heavily toward sellers, Rabidoux doesn't see things correcting anytime soon.
"We're still in this strange world of incredibly low interest rates and post-pandemic recovery and we don't really know how it's going to shake out," he said.
Buyers remain discouraged
And on the buyer's side, it's still a tough market to navigate.
Dan Riendeau has been looking to buy a home in Ottawa for two years, which has included about 60 visits to homes.
Riendeau and his wife say they've liked fewer than 10 and for the homes where they did put an offer in, they've been outbid by sometimes more than $140,000.
"To say the market has relaxed a bit … I'm not so sure. There are less houses on the market and whatever prices that are being asked are still over and above what they should be," Riendeau said.
Riendeau says he and his wife make above-average salaries, but are discouraged and shocked to find that semi-detached homes in the city are going for $1.2 million, which he calls a generous estimate.
He says the process of buying a home feels very rushed, roping some into buying homes they like, but not necessarily love because of how competitive the market is.
"You're being told that if you have any conditions on buying a house right now, someone that doesn't have any conditions is going to get the house before you."
'Don't stretch yourself thin for property'
The experience is just as stressful for those who successfully bought in 2021, such as Josh Flynn and his wife Marcela.
They also started the search for a new home two years ago, and the experience was much different than when they bought their first home in 2013.
"You had more time to be thoughtful and intentional. It was a much more exciting experience in that there was a build-up and anticipation to the whole process," Flynn said.
"Today, it's a strategic game of chess combined with a bit of a lottery."
Flynn has been on the buyer and seller side, and says he still thinks there's an aggressive bump in the value of homes. For those looking to buy, his advice is not to rush.
"Don't stretch yourself thin for property. I think there's too much variability right now as a new home buyer."