The Ottawa real estate market had a great July. We have not had this kind of activity in a July for 15 years. Typically after a busy Spring market things slow in the summer. This year is the exception. We had over 1800 sales on the MLS system. There is just so much demand out there right now for Ottawa real estate. I am starting to see more inventory come to market which is good news. Hopefully, this will lead us back to a more balanced market. Right now there is around a 1 months supply of housing. This is deep into a sellers market. We would need to get to at least a 3 month supply to start getting closer to something more balanced.
The condo market had another strong month. Condo prices have fully recovered and you can see by the sales numbers that this segment of the market is having a resurgence. This is good news for condo owners and builders. Lots of optimism surrounding the Ottawa market right now. I anticipate a very strong fall market. If you are curious to know what’s happening in your Ottawa neighbourhood feel free to get in touch.
The average price of a residential-class property in June was $500,700. This is the first time we have ever eclipsed the half-million mark in Ottawa. When I first started in real estate 15 years ago 500k was a big number! People would say half a million like it meant something! Hard to believe it is now just average. Many first time buyers are now buying at this price point. It is just the nature of a really healthy local economy, immigration, and the increasing appeal of our real estate market to investors. Maybe in the next 10 years, 1 million will be just an average number. At this pace, you never know!!
Inventory has been sliding in Ottawa. In June our inventory was down 23% from the same time last year and over 30% from just two years ago. Condo listings were down 50% from 2017. Just the drop in this inventory is enough to put upward pressure on prices. Combine that with growing demand and we are seeing double-digit increases in some neighbourhoods. It is definitely a seller’s market but for the most part, buyers are restraining themselves a little bit. They understand the value, many homes priced on the high side of the market can continue to sit.
May is typically the busiest month of the year for real estate sales. This year was one of the most active Mays I can remember. We had higher sales volume while dealing with a freefall in available homes for sale. This meant that many of the listings available were sold in multiple offers for the above-asking price. Our team in just the past few weeks have been involved in over a dozen of these situations both on the buyer and seller side of things. There has never been a more important time to have a Realtor guide you through these difficult and stressful situations. There is lots of money on the line on both sides of the equation. Our market is constantly changing. What sold 5-8 months ago in some neighbourhoods is totally irrelevant to what’s happening now. There are many micro markets in the city that I am seeing different trends. Same can be said about price points. As an example, the 350k to 500k price point accounts for 42% of all Ottawa sales. If you want to find out what’s happening in your area feel free to get in touch.
The Ottawa real estate market continues to hit new highs. Multiple offers across the city continue to put upward pressure on prices. There is no secret that Ottawa has a supply issue. Housing inventory remains at record low levels. Sellers are hesitant to put their houses for sale because there is not much to purchase on the other side. It has created a bit of a catch 22. This low inventory appears to be a trend likely to continue for the foreseeable future.
The BIG QUESTION I am getting lately is will prices continue to go up or is there a bubble near? I don’t have a crystal ball but I do talk about this in our monthly report. You can find it below.
One of the best marketing campaigns I can remember growing up was Head and Shoulders shampoo. Their slogan was “because you never get a second chance to make a first impression”. It is so true in not having dandruff on your shirt and it can also be applied to real estate. Stay with me here. When home buyers walk into your house you want to be feeling good about what they see and excited about what is to come! First impressions are crucial!!
Side note: I looked up that campaign and it was from the ’80s (ageing myself a bit). I still use H&S today because I am petrified of dandruff and making the wrong first impression.
If you are a home buyer what room would make a good impression to you:
Well, I agree with your choice. We suggested the homeowner bring in some rental furniture to outfit this room properly. We then made the room come to life and accessorized it.
Of course, once you commit to the staging you can’t just stop at one room. It all has to come together. In this case, we had a pretty solid plan that the homeowners bought into. We ended up bringing some of our own furniture we use for lots of stagings, to bring it all together.
You will notice the kids room. We felt the demographic buying would be younger families so we showcased as such. That is Aiden’s (my son) old bed and some of his toys/books. ? Don’t tell him! We also brought a desk and chair in for the loft among many other changes.
Why go through all this work?
This is really the big question, isn’t it? Is it really worth it to stage? My answer is, absolutely. Having a fresh, modern, clean look is the key. We want people to feel excited about the house and the possibility of owning it. I bet there are people who would not even offer on the house as it sat before. They might not even realize why. Hard to prove this theory but we have taken over many non-staged homes that could not sell. We keep the prices the same and then like magic! they sell for top dollar. That is why I also invested over $2500 to stage my own place when I sold. Anyways, I am ranting a bit here but it is what I believe with conviction.
Interesting numbers released by the Ottawa real estate market this week. The number of sales are down over 12% in the residential class segment. At first glance, one would think it is a slow market but the lack of sales is only because of the extremely tight supply. There is just not much available to buy right now. This is putting upward pressure on prices. As an example, I have a listing that sold in 2017 for $475k. This year it sold for close to $560k. No real work was done on it. It is incredible to see some of these price gains. Much of this appreciation is in the entry-level segment of the market. It is also very much neighbourhood dependent.
I have been saying in my annual reports for years that Ottawa is undervalued. It seems that others are starting to catch on and maybe we are having a correction of prices. They are just going up rather than down. Our population growth was pegged at 8.8% this year. That coupled with the really good local economy and still relative affordability in the housing market and you have this perfect storm of factors. My hope is that we see a higher than average number of homes for sale this Spring. This would help ease the pressure facing buyers and prices in this market! If you have any questions on your neighbourhood feel free to get in touch.
It was another strong month for real estate sales in Ottawa. Members of the board sold 1,005 residential properties, that is up from 978 last year. What is more impressive is that this was done while the inventory is down. The low inventory has left buyers competing over fewer homes. The sales numbers would have been much higher if there was more available for sale. This has spiked the average home price to over 8.6% when compared to February of 2018. The lack of inventory tells me that this trend will continue likely throughout the year. We could continue to see upward pressure on prices. To put it in perspective we have 40% less available homes when compared to February of 2017 with more demand.
The average price of a residential-class property in Ottawa last month was $466,540. The condo market is also lacking inventory holds down an average price of $288,000, this is up 5.6% compared with February of last year.
In the big picture, Ottawa remains the most stable real estate market in North America. Historically we have always posted gains year to year and have weathered economic storms better than any other housing market. This year we are starting to see weakness in other market centres while Ottawa continues to thrive. This is because our housing is still relatively affordable considering our high household income averages. How long I will be about to tout that is uncertain! Everything points towards an extremely active Spring market.
As always I encourage everyone to think about investment properties. It has been one of the most consistent ways to build wealth. We are fortunate to have such a great opportunity in our backyard. Prices are still affordable but for how long we shall see.
If you are curious to know whats happening in your neighbourhood please feel free to get in touch.
January is usually one of the slowest months of the year in real estate and although we had record low temperatures and lots of snowfall… the Ottawa market was hot. In January the residential and condo property classes there were 820 homes sold. That is a large jump to a 15.8% increase in units sold over January 2018. This is the highest increase Ottawa has experienced in decades. This could be a sign of things to come for our 2019 housing market.
The average sale price for homes in Ottawa continues to rise over last year’s numbers. In January we saw a 1.5% increase in the residential class property and in the condo property class we saw an increase of 7.7% over January 2018.
The $300,000 to $449,000 range remains the most active price point in the residential market contributing to 42.5% of homes sold. The $175,000 to $274,999 price range was the most active price point for the condos market in Ottawa, accounting for almost 54.1% of the units sold. If you are interested in finding out the market trends in your neighbourhood, please feel free to get in touch.
Our team has just invested in a moving concierge program that will be a game changer for our clients. This new platform will assist our clients with everything from changing addresses, transferring home services, updating identification, and getting helpful advice. This can include anything from setting up short term Airbnb accommodations to organizing moving company quotes. Each client will have a dedicated concierge agent. We are completely committed to the client experience. We hope this new service will bring value to our clients and make the transition into the new home as easy as possible.
As an Ottawa realtor, I’m often asked by my clients that are both selling and buying a home, if they will have to pay CMHC again. It is an important real estate question and we want our clients to have all the answers before proceeding. What is CMHC?
Canada Mortgage and Housing Corporation is insurance which protects the lenders and thereby allows buyers to put a lower downpayment on a purchase and in most cases allows more competitive rates.
Now knowing what CMHC is, we know it is applicable depending on the size of the downpayment and whether or not the lender would like the mortgage insured.
Here are some scenarios to help you better understand if CMHC would be applicable to you.
Staying With Your Current Lender
Conventional Uninsured Mortgage – If you are staying with your current lender and your new purchase will have a 20% downpayment or higher, you will most likely not have to pay CMHC unless your current lender requires it as part of their guidelines to be a Conventional Insurable Mortgage. High Ratio Insured Mortgage – If you are staying with your current lender and your new Ottawa home purchase will have less than a 20% downpayment, you will most likely have to pay the top-up premium on the new amount. For example: Your home sells for $400,000. Your Mortgage amount owing is $350,000. You use the equity from the sale of your home for your new purchase of $500,000. This would approximately only be a 10% downpayment and would require you to pay CMHC and the top-up difference. The difference would be $500,000 (purchase price)-$50,000 (downpayment)-$350,000 (previous mortgage amount) = $100,000 (additional new mortgage amount). As of January 15, 2019, with a 90% L-T-V (10% downpayment) the premium on a top-up is 6.25%. So your top-up CMHC premium would be $100,000 x 6.25% = $6,250 (as a new premium would be 3.10% which would be $450,000 x 3.10% = $13,950) Also please note: your mortgage must stay at the existing amortization remaining on your current mortgage for the top up premium to be used in most cases.
Changing Lenders
Conventional Uninsured Mortgage – If you are changing your lender and your new purchase will have a 20% downpayment or higher, you will most likely not have to pay CMHC unless your new lender requires it as part of their guidelines to be a Conventional Insurable Mortgage.
High Ratio Insured Mortgage – If you are changing lenders and your new purchase will have less than a 20% downpayment, you will most likely have to pay the top-up premium on the new amount or full CMHC on the total loan amount. Whichever is less. This is where having a mortgage broker’s guidance can help answer whether it is better to pay full CMHC or the top-up premium.
Our team has just invested in a moving concierge program that will be a game changer for our clients. This new platform will assist our clients with everything from changing addresses, transferring home services, updating identification, and getting helpful advice. This can include anything from setting up short term Airbnb accommodations to organizing moving company quotes. Each client will have a dedicated concierge agent. We are completely committed to the client experience. We hope this new service will bring value to our clients and make the transition into the new home as easy as possible.
