Archive for the ‘Chris’ Blog’ Category
Posted on: January 11th, 2022 by Chris Scott
OTTAWA REAL ESTATE REPORT
Ottawa 2021 Real Estate Market Report Review
Do you ever feel like you are in the movie Groundhog Day? Well, I certainly do. We are starting the year with school online, COVID is still a part of everyday life, and for home buyers, very few homes to choose from. Prices are smashing price records and making economists and analysts look like they have no idea what they are doing. Is 2022 the year we get back to some normalcy? I don’t think anyone could have predicted that a global pandemic would send housing prices through the roof. The question now becomes well what’s next?
Average sales prices are for 2021 based on MLS sales.
Combined is for all property classes. Arrows are gains from 2020.
OTTAWA REAL ESTATE REPORT
FORECAST 2022
It has been hard to predict how the market would react to the pandemic, now, two years in, it is even more challenging to make any sense of it. I have read everything available including CMHC reports, Economist, and leading analysts’ predictions. This year I feel like everyone is being careful with their thoughts. Likely because no one really knows, impossible to predict the unpredictable. I refer to the economic principle of supply and demand. A trend over the pandemic is low inventory, hovering around, or just under one month’s supply, a true seller’s market. Currently, supply is very low, with just this one indicator it is difficult to see how prices will not go anywhere but up.
REAL ESTATE CHANGING
Our industry is constantly changing. There are many new players in the local market that offer a wide range of services to buyers and sellers. You can auction your home, sell it with a call centre in Toronto, use a local Realtor or put a for sale sign on the lawn yourself. There are 3500 agents in Ottawa to choose from. Having this many choices is overwhelming but also very good for the consumer. It forces everyone who wants to compete for your business to up their value proposition. Our team has completely revamped our services for 2022. We are always striving to bring the best value to our clients. We have a menu of services that will help us compete against any platforms. So if you are in the market this year to buy or sell, give us a call.
Based on OREB RES & CON MLS Sales | 2022 Prediction
KEY INDICATORS
 Our Country’s Population Growth in 2021 |
G7 Population Growth 2021
Canada has had the highest population growth in the G7 and also the lowest per capita stock of housing. Quite simply we have a housing supply crisis. This is one of the many reasons why our market prices have escalated so quickly. We can look at all the new developments and cranes in and around our community but it is not enough to have an impact on price gains in 2022. Ottawa in particular has been a sought-after city for new immigration due to its high quality of living. |
 Historic Ottawa Freehold & Condo Inventory Since 2004 |
Inventory
As mentioned above. The very core of the price increases is the basic economic principle of supply and demand. In Ottawa we simply do not have enough housing for everyone right now. This is putting upward pressure on prices as buyers compete for what becomes available. |
 Historic Canadian Inflation Rates Since 1995 |
Canada’s Inflation Rate
Prices are rising rapidly everywhere. One interesting stat is that container ship costs have gone up 500% since 2019. Those costs get passed along to the consumer. Housing, cars, equipment, lumber, and especially food. COVID has brought about so many unique challenges that will have lasting impacts on our economy. One of them will be that the cost of goods and services will continue to rise. This will have an impact on what buyers will be able to afford. |
 Variations in Bank of Canada Interest Rates Since 2000 |
Bank of Canada Overnight Interest Rate
Right now interest rates are the big equalizer. The low rates are making the high prices relatively affordable. How long can these rates stay low? Central bankers are in a tough position. They could decide to act because prices are rising so fast and are not in sync with incomes. If the Bank of Canada should go this route they would also risk causing a housing market downturn. My prediction here is that rates will rise and help slow our market. This will happen in the late summer.
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If you are curious about your home’s worth please fill in this form for a no-obligation market assessment.
Posted on: December 10th, 2021 by Chris Scott
If we compare this past November’s real estate market to November 2020, we again see that it is skewed as the Spring market was pushed into Fall in 2020 due to the pandemic lockdown. In comparison, November’s unit sales tracked 14% higher than 2019 (1,284), a more relevant base year. This is good to keep in mind when taking in the most recent market statistics.
1,459 residential properties were sold in November compared with 1,605 in November 2020, a decrease of 9%. November’s sales included 1,086 in the residential-property class, down 10% from a year ago, and 373 in the condominium-property category, a decrease of 7% from November 2020. The five-year average for total unit sales in November is 1,348.
Average sale prices for November are for a residential-class property $716,992, an increase of 19% from a year ago, and the average sale price for a condominium-class property was $432,099, an increase of 19% from 2020. With year-to-date average sale prices at $719,956 for residential and $420,762 for condominiums, these values represent a 24% and 16% increase over 2020, respectively.
Even though there were significant increases in average prices over November 2020, month-to-month price accelerations have tapered off slightly, with average prices for residential units on par with this past October’s and condo average prices increasing by 7%. For buyers, this is a much better situation than the monthly price escalations the first quarter of 2021 had shown us.
Ottawa is still sitting at one month’s supply for inventory, still signaling a seller’s market. Supply constraints will continue to affect prices until more inventory is made available.
As always if you have any questions or would like to know about any activity in your neighbourhood feel free to reach out.
Posted on: December 8th, 2021 by Chris Scott
We recently had the pleasure of working with some wonderful past clients on the sale of their beautiful townhome in Upper Hunt Club. In preparation for our appointment, we looked at all the most recent comparable sales. The house right beside was the closest comparable property. In fact, it was the exact same layout, size, bedrooms, bathrooms. It was virtually identical. Except the owners decided to sell with a limited-service brokerage and did not stage the house. The other home also had the advantage of selling in the hot summer months and is an end unit that buyers would pay a premium for.
These are the results:
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Days on Market
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Offers
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Sold Price
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CHRIS SCOTT TEAM
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CHRIS SCOTT TEAM
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CHRIS SCOTT TEAM
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1
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2
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$639,000
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COMPETITION
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COMPETITION
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COMPETITION
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81
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1
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$587,000
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Neighbours listing pictures (courtesy of MLS):
Our listing before our staging:
Our listing when we went to market:
Our clients received $52,000 more for their unit. It is stories like these we like to share because we think everyone brings a different skill set when selling ones home. Our real estate team believes in our value proposition as we get to see results like these on a daily basis in Ottawa.
Posted on: November 12th, 2021 by Chris Scott
October’s market was a bit more normal, in terms of units sold, given the regular Fall season, it was active, busy, and things seem to be stabilizing. Compared with 2020, the statistics are showing a decrease in units sold, which is still reflective of the shift of the 2020 Spring market to Fall 2020, which was due to the Spring 2020 lockdown.
Inventory is remaining at a one-months supply for residential and a 1.2 months supply for condos, which is why there is still pressure on prices. With this amount of inventory, it is still considered a sellers market. The only way to find balance in this market is to increase available housing stock.
Low inventory and a lack of suitable housing options are not giving buyers who want to move up the property ladder or those that want to downsize a place to go. Because of this, properties are not being freed up for entry-level homebuyers.
Another piece of the puzzle is rental properties, Ottawa Real Estate Board has noticed a substantial increase in the number of rental transactions. This could suggest that some properties have been purchased or held on to for investment purposes. This active rental market may be another contributing factor as to why there aren’t more properties coming onto the market for sale.
All of these factors put together equal a tough market for buyers to navigate.
As always if you have any questions or are interested in knowing more about activity in your neighbourhood, feel free to give us a call.
Posted on: October 13th, 2021 by Chris Scott
The Ottawa Real Estate Market seems to be back to a typical September market. It started off slowly due to the long weekend and back to school, but it picked up again near the end of the month.
Last month, 1,607 residential properties were sold, compared with 2,314 in September 2020, a decrease of 31%. September’s sales included 1,244 in the residential-property class, down 29% from a year ago, and 363 in the condominium-property category, a decrease of 36% from September 2020. The five-year average for total unit sales in September is 1,648.
Statistics are showing a considerable year-over-year decrease in transactions, due to the lockdown in Spring of 2020, the peak of the market shifted from the Spring to the Summer and Fall months. For some perspective, the number of transactions in September was 4% higher than in 2019 (1,547) and 16% higher than 2018 (1,387).
September’s average sale price for a condominium-class property was $425,362, an increase of 14% from last year, while the average sale price for a residential-class property was $702,155, an increase of 13% from a year ago. With year-to-date average sale prices at $720,492 for residential and $421,062 for condominiums, these values represent a 25% and 17% increase over 2020, respectively.
Inventory is still sitting at just over one month’s supply of housing stock at this time. There were 2,252 new listings in September, an increase of 216 units over August; however, the number still falls beneath the five-year average and is much lower than this month in September 2020 (2,906). Price escalations are inevitable given the supply challenges we have been experiencing for several years now combined with the unrelenting high demand.
As always if you are interested to know more about the market, or if you would like to know what a home in your area sold for, please get in touch!
Posted on: September 14th, 2021 by Chris Scott
If anyone is interested. Here are some random thoughts on a few things real estate and otherwise.
Capital Gains on Primary Residences?
This is not going to happen. I have been asked this a few times this past month. Governments want to get elected again and having 100% of homeowners against them will not help their chances. Could they increase the capital gains on investment properties or flipping. I believe that could be the case. But they will never come after our gains on our primary residence.
Changing Market
Sellers really need to start having better expectations of what they are going to get in this market. I recently priced out a house that may have gotten $1 million as a sale price in April. Right now, I’m seeing that it may be more like 925 to 950k. The seller seemed very disappointed at this number. This is a house that would’ve been worth 775 last year. I would still say it was a very good investment we are just not selling at the all-time high right now.
The Power of Staging
One of the hardest things to do as a real estate consultant is showing people the value of staging. It is hard because there is no clear return on investment. What I mean by that is when you do the staging there’s no set amount that you’re going to get back by doing it. It is all based on my experience as a realtor and seeing firsthand that home preparation is the number one way to increase what a client will get for their house. I spent $3000 staging my own house and Colin from our team spent over $2000 staging his home for sale. There is a reason we invested in this process.
Pandemic Fatigue
Anyone else feel that they need the world to go back to normal ASAP? In many ways, this Fall is hopefully going to bring some normalcy with kids back in school. For me as a business owner, team leader, realtor, friend, and most importantly father and husband it has been so difficult to feel like I am succeeding at any one of these important tasks. I feel like I’m doing OK but just not flourishing if you know what I mean. In many ways, I need to relearn the good habits that I had in place before covid started. Also, anyone else dressing a lot more casually? Lulu dress pants are now my go-to!
Current Favourites
The best snack mix going right now is the Cajun mix at Farm Boy, another favorite is Farm Boy’s chocolate-covered pretzels. A close second are Miss Vickie’s Spicy Dill Pickle chips. Anyone one else developing a snacking habit? We have snack-a-palooza’s at least twice a week.
Recent Reads
Right now, I am reading Greenlights by Mathew McConaughey. Good life story. It is funny and interesting. Alright, Alright, Alright!
Also, reading The Song of Achilles. So far so good.
Best of TV
Right now the best thing on TV are the Blue Jays! Loving the streak and playoff push.
Posted on: September 14th, 2021 by Chris Scott
This Fall will be an interesting real estate market to monitor in Ottawa. I think it will be very active but prices will continue to stabilize. I am already feeling a shift. Showing activity is down and buyers are not quite as willing to pay a premium price on some listings. They are starting to get more patient or are just burnt out from the year that was. It is important to understand that buying a home within set criteria is no easy feat right now.
August has brought us even more stabilization to the market and offering a bit more of an increase in housing stock at 1.5 months of inventory. This is still categorized as a seller’s market, as a balanced market is defined as 4-6.5 months’ worth of inventory. August’s inventory is approximately 5-6% higher than last year for both residential and condominium property classes.
The latest stats from the Ottawa Real Estate Board show a sharp decrease in sales compared to last year’s numbers due to the first wave lockdown in Spring 2020, which shifted 2020’s usual Spring market to the Summer and Fall months. However, August 2021 numbers are on par with August 2017 and 2018.
Last month there were 1,175 residential properties sold, compare that to 1,568 in August 2020, a decrease of 25%. Condominium-property class sales were 397, a decrease of 9% from August 2020. The five-year average for total unit sales in August is 1,684.
Year-to-date resales are at 14,728 and are 24% higher than this period in 2020, indicating Ottawa’s market is currently in another strong year.
August’s average sale price for a condominium-class property was $407,148, an increase of 6% from last year, while the average sale price for a residential-class property was $674,449, an increase of 14% from a year ago.
With year-to-date average sale prices at $722,526 for residential and $420,654 for condominiums, these values represent a 27% and 18% increase over 2020, respectively.
“Supply continues to remain scarce, and that is the driving factor behind these price increases. New listings were down 400 units from July and 500 units from last August and below the 5-year average for the first time this year since February.” states Ottawa Real Estate Board President Debra Wright.
“We are pleased to see that housing affordability and the supply shortage have been a predominant part of election conversations and federal party platform pledges – which is a step in the right direction. We look forward to the collaboration between municipal, provincial, and federal governments to establish measures which will effectively address these fundamental barriers to homeownership for all Canadians who desire to own a home.” Debra adds.
As always if you are interested to know more about the market, or if you would like to know what a home in your area sold for, please get in touch!
Posted on: August 10th, 2021 by Chris Scott
The Ottawa real estate market has continued to stabilize. The record rise in prices seems to be trailing off. This is welcome news for buyers. You can see this in the numbers that were released from the Ottawa Real Estate Board.
Last month there were 1,312 residential properties sold, compare that to 2,183 in July 2020 and there is a decrease of 20%. Condo properties sold numbered 412, down 24% from this time last year. Now last year we were coming out of a lockdown in Spring so those numbers are a bit inflated because the Spring market was pushed more to the summer months. Month over month prices are down for the 3rd consecutive month, although still nice gains year over year of 30% on residential class property and 20% on the condo class.
The frenzy that was a few months ago has settled. Instead of every property going into multiples it is now just the cream of the crop that attract the frenzy. Make no mistake this is still a seller’s market and some houses are still getting double digit offers. It is just not the norm. Sellers need to have realistic expectations of the current market conditions. Many sellers right now are coming in too high and are sitting on the market. They want to list high and get the bidding war. You can’t have your cake and eat it too! I think a hybrid approach is working best.
Housing stock is increasing with residential inventory up 19% and condominium supply up 23%, higher than 2020.
There were fewer listings in July vs. June, however, the number of properties that entered the market in July is over the five-year-average. This along with seeing housing prices stabilize, it seems we are headed towards a more balanced market in the months ahead.
As always if you are interested in knowing what is going on in your neighbourhood or have any questions, please feel free to reach out.
Posted on: July 13th, 2021 by Chris Scott
The talk of Ottawa the past few weeks has been the cooling real estate market. I just wanted to add some perspective on this. The market is most certainly changing but the first quarter of this year was so hot that we may never see that type of inventory shortage again in our lifetime. It is just not the same offer frenzy that we were used to. Buyers are spreading their offers around on different properties. Hopefully this will lead to more balance in the market.
The market is not the same as what it was and that is ok. It is still very much a seller’s market right now. Prices have stabilized and for the most part, sellers are still trying to achieve prices that comparable houses sold for a few months ago. In some areas that is still very achievable and in other cases those numbers are now out of reach.
Where do we go from here?
Prices have certainly stabilized over the past few months. Buyers still seem to be able and willing to pay the premium prices that sellers are demanding. There are fewer offers on properties but the pricing strategy has really changed. Sellers in many cases are now pricing at the mid to high end of the market. So instead of pricing a home 100k less than what they expect they may price it 20-50k less and if on offer date they don’t get an offer they likely will increase the price to match their expectations. Some sellers are still going way under their desired price and others are pricing right at the most recent comparable. This has created a very complicated marketplace. With so many strategies out there it is important to lean on your Realtors experience to help navigate you through it.
With year-to-date average sale prices at $734,357 for residential and $422,734 for condominiums, these values represent a 33 per cent and 20 percent increase over 2020, respectively. Pretty incredible numbers really.
Every house is unique. If you want to know what’s happening in your area please feel free to reach out.
Posted on: June 15th, 2021 by Chris Scott
Earlier this year my wife and I sold our home. Being a seller myself was a great learning experience. I asked my team to put me through all the systems that any client of ours would experience. I was quite happy with the way things went!
Selling with kids that are homeschooling is no easy feat! I believe in staging and so we had our home fully staged. This included bringing in artwork, textiles, accessories, rugs, and furniture. We had so much stuff they had to bring a moving truck to unload it all. Of course there is a high cost to bring in this many pieces. Just for the staging alone we were over $3000. As a Realtor I know the value in this and was happy to spend the resources to make sure our home was presented in the right light. I looked at it as a small investment that I know had a big return. There is so much money on the line in this market. I wanted to make sure everything was done correctly.
When we launched on MLS the house looked great and we had lots of potential buyers through. On offer presentation day it was a bit more stressful than I had first anticipated. It is nerve wracking not to know what price you would get or if any offers would come in. We were very happy with the outcome and I would hire my team again if we needed to sell! I will definitely use my experience as a seller to enhance our services in the future.
Here are a few things we did that I recommend for everyone looking to sell.
We completed several small fixes to add that extra polish to the house. Painting baseboards, stretching the carpet, new mirrors in the bathroom, switching out light fixtures, to name a few.
Professional painting
You don’t have to paint the whole house. It can just include small areas to freshen it up. Patch and paint any problem areas. Remove any scuff marks on the walls, paint the baseboards on the main level. All this will ensure the house pops.
Updating light fixtures
This is a small cost to modernize any area. We updated many of the lighting fixtures throughout the house, this really added to the fresh feeling.
Minimalistic approach
This was very important and easy to achieve. Really store away excess items and personal items. This is an approach we used with our built-in bookshelves in the living room. We took down a lot of the items and really depersonalized the space, this is important to do so future buyers can really see themselves in the space.
