March 2021 - Ottawa Real Estate Market
Sunday Mar 14th, 2021
Sorry for the delay in getting out the update this month. It has been a busy start of March! It’s no secret the Ottawa real estate market continues to be one of the hottest markets in the country.
The average sale price of a residential home in Ottawa in February 2021 climbed to:
This is up over 6% just from the previous month and over 27% from February 2020:
Supply of residential homes continues to be weak as there were almost 60% fewer homes on the market this February vs February 2020:
I believe this is the major indicator that needs to change if we want to see a more balanced market.
But will it soon?
Has anyone gone to a home builders’ website (Minto, Richcraft etc…) and tried to find their “Quick Closing” or “Immediate Occupancy” sections? You will be hard pressed to find ANYTHING readily available in the residential home category. The pandemic has had an impact on new home builds and in my opinion is one of the reasons for the overall shortfall of supply. Once builders ‘catch up’ with demand (in late 2021?...or 2022?), maybe then will we hopefully see a boost in inventory levels in the residential marketplace.
Until the supply factor changes, the sellers market, and multi offers, will continue in the residential segment…nice for sellers…frustrating for buyers!
The condo market in Ottawa continues to grow, however, not at the pace of single family homes. This has been the trend since the pandemic was announced almost a year ago.
In February 2021, the average price of a condo in Ottawa was $407,671, up 16.6% from the previous February:
The trend in the last 12 months continues to be buyers looking for space and that is perhaps the reason for the slower pace of growth in condo prices. From an inventory perspective, there is a less pronounced dip in inventory levels for the condo market. There were only 5% fewer condos on the market in February 2021 than there were a year earlier:
Look for the condo market to continue to grow in the short term, but not at the pace of residential homes.
As it turned out, February was an excellent time to list/sell a home simply because “there was nothing out there.” Each home I visited and tracked in the month of February had multiple offers on it and sold over asking. The market does not seem to be paying attention to the typically slow “winter season” as buyers continue to line up, literally, for properties. There were 24% more sales this February in the residential space compared to last February and the average days on market for a residential home was 14! To be honest, I think that 14 number is inflated. If you consider the selling strategies of agents and their clients these days, most are delaying offers for 5-7 days after a property is listed. I am confident that most homes would sell in a day or two if there was not a “no conveyance of offers” clause for residential listings.
Switching to the macro economy, the Bank of Canada announced last week that they are keeping the overnight interest rate at the effective lower bound (0.25%), as expected. They continue with the wording that they will keep the interest rate at 0.25% until “economic slack is absorbed and that the 2% inflation target (CPI) is sustained.” In January, they predicted this would likely be sometime in 2023 but with economic activity picking up a bit in the last few months, it will be interesting to hear their view 6 weeks from now when they release their next Monetary Policy Report. I will provide an analysis when that is released!
FYI - NEW LISTING ALERT …That came and went…
At the beginning of March, I listed a beautiful detached home in Westboro. Check it out:
Yes, we received multiple offers on it, and yes, it sold (way) over asking, but I want to talk more about the PROCESS. My theory is the process generates the results. For sure there will always be an element of timing/luck for real estate transactions but having a strategy/process in place sets you up for success as a seller!
For this particular home, my clients and I worked together as a TEAM to plan and execute this deal.
A pre-listing home inspection, staging consultation, photographs, virtual tours, establishing a list price, launch date and offer strategy were all part of the process and done so and discussed as a TEAM.
With every person/family I meet, I stress the TEAM dynamic…that’s how I (WE) operate!
If you ever have any questions about the process, never hesitate to reach out!
Check it out!! I’ve added some client testimonials since last time and will be continuing to add new content.
And I love referrals - Set me up with a friend or family member and you will be financially rewarded!
Have a great day!