Condo sales move out of doldrums to keep Ottawa real estate market steady

After a tough few years, condominium sales in Ottawa have continued their resurgence in 2017, with the number of sales jumping almost 25 per cent in the year to date compared with the same period in 2016.

From January 1 to August 31, 2017, some 2,518 condos sold in Ottawa, compared with 2,020 during the same period in 2016.

“Condominium inventory has reduced slightly and the rate of sales is up,” explains Patrick Morris. “Although the condo market is not back to where it was in 2011, condo sales are improving, and that’s positive.” OTTAWA_Sales_to_Inventory_Ratio_Updated_CGraph.JPG

This boost has helped Ottawa’s real estate market to maintain steady sales into the summer. Members of the Ottawa Real Estate Board sold 1,538 homes in July (359 condos and 1,179 residential properties), compared with 1,481 in August 2016. The most active price range for residential property sales continued to be between $300,000 and $499,999, accounting for more than half of residential property sales. For condos, the most active price point is between $150,000 and $249,999.

The RBC Housing Trends and Affordability report for June 2017 noted that Ottawa’s real estate market has stayed reasonably affordable and steady—especially compared with the volatile GTA—and that this may attract buyers to the area. While there was a decline in new Ottawa listings in the winter and spring of this year, which shifted the balance in favour of sellers, that trend is reversing.

“We were in a seller’s market for much of the year,” observes Patrick, “but now the market is more balanced, with more inventory, which is good for buyers.”

In a seller’s market, demand for houses is high and inventory is low, making conditions favourable for those who want to sell. Generally, when more than 25 per cent of listings sell in a given month, that puts the market in seller’s territory.

In a balanced market, there is a buyer for every listing—a good situation for both buyers and sellers—and the rate of sales is in the 15 to 25 per cent range.

In a buyer’s market, the number of properties available for sale is high, giving buyers a lot of latitude. When less than 15 per cent of the inventory sells in a given month, that puts the market in buyer’s territory.Res_and_Condo_YTD_2017_vs_2016_chart.JPG 

As the graph shows, Ottawa’s market for residential properties (i.e., houses) spent much of the past three years in balanced territory. From January 2017 until late June, it became a seller’s market. Since the summer began, the sales to inventory ratio has gone back down, however, which is rebalancing the residential property market.

Condos were another story. For much of the past three years, the condo market was overloaded with new inventory, and sales were slow. This year, however, with the decline in inventory and the rise in sales, condos have moved back to balanced territory.

Patrick anticipates that sales activity will continue to be steady going into September and October. Even though interest rates have increased in July for the first time in seven years, and then again on September 6, he says it will take some time for the effects of the rate rise to become apparent: “Demand is so high in the entry-level market that the interest rate rise may not have a dampening effect, at least not until the spring.”

8 Things You Need to Know About Selling Your Home in the Fall

Fall is a great time of year to sell. Springtime may be the most popular season for putting a home on the market, but there are many reasons to sell in the autumn: families have returned from vacation; kids have gone back to school; and we are set to enjoy 90 days of normalcy before the winter holidays arrive. Even if there might be fewer buyers in the fall, those buyers are motivated.

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1. Maximize Curb Appeal

Crisp air and colorful trees make the autumn a favorite time of year for many, but be prepared to keep up the curbside appeal as the weather changes. Neatly trimmed hedges, manicured lawns, and mulched beds all help make that crucial first impression. Add colour with freshly painted front doors, new mailboxes and house numbers, and seasonal flowers. Potential buyers will make an instant judgement when they see your home; make sure it’s positive.
Rain and wind during the summer can make your windows dusty and streaked by autumn. You might not notice smudges, but buyers will. Make your windows sparkle to help sell your home.
Ensure walkways and gutters are free of leaves and debris. Wash down decks.
Clear out the knickknacks, bicycles and toys that make your home appear cluttered.

2. Check the HVAC

Keep the air inside your home smelling fresh by regularly changing your furnace filter and using a dehumidifier to remove any damp air. Have the HVAC system checked before it’s time to turn on the heat, and fix any problems with the furnace before you put your home on the market.

3. Let There Be Light

The days are shorter in the fall, and plenty of buyers will want to look at homes after work, when it will  already have become dark. Presentation is everything when you’re selling real estate; you don’t want a buyer walking into a dark, unlit home. Turn on an abundance of lights both inside and out. Make sure your walkways and any exterior entertainment areas are well lit.

4. Display Photos from Warmer Days

Put spring and summer photos of the home’s exterior online, and display them during showings. Allow potential buyers to see what the beautiful flower beds and garden around your property look like on warmer days.

5. List Your Home at the Right Price

Work with your real estate agent to price your home correctly for the current market. A house doesn’t necessarily need to be priced lower just because the fall and winter are “off seasons,” but you don’t want your home lingering on the market. If you are heading into the winter (an even slower time) you want to get the asking price right the first time.

6. Keep the House Cozy

A cold house could leave an unfavorable impression. Make buyers forget the cold by giving your place a cozy look and feel. Highlight rooms and features that serve as a great place to hang out while you’re hibernating. Give your home a fresh coat of paint and set the thermostat at a comfortable temperature.

7. Go Easy on the Seasonal Décor

Staging is important, but there can be too much of a good thing. Keep the fall decorations simple—a few potted mums and a wreath—because you want the buyer to remember the house and not your spooky Hallowe’en scene. 

8. Always be Ready to Show

Your house needs to be “show ready” at all times. You never know when your buyer is going to walk through the door. Be available for viewings, and keep your house in tip-top shape. Clear away the dishes, make the bathrooms sparkle, and send those dust bunnies packing. The maintenance will be a little inconvenient, but it will help get your home sold. 

Millennial Generation Set to Alter Real Estate Landscape Despite Challenges

The real estate market is about to be inundated and inevitably changed by the largest cohort of the millennial generation (those born between 1980 and 1999), according to the national Royal LePage Peak Millennial Survey, released in August.

Despite the challenges they face in terms of home affordability and stricter mortgage regulation, so-called “peak millennials”—who are now between 25 and 30 years old—are going to heavily influence the real estate market due to their sheer numbers.   

In 2016, the number of 25- to 30-year-olds in Canada surpassed 2.65 million. Their population is expected to rise to 3.1 million by 2021, an increase of 17 per cent.

Royal LePage president and CEO Phil Soper noted, “We expect demand from this demographic to put additional pressure on entry-level housing and investment properties being used to supplement the limited inventory of purpose-built rental buildings.”

Only a third of millennials own their home. Even though 61 per cent of survey respondents said they would prefer to buy a detached home, only 36 per cent believe they will realistically be able to find a property. Those in Toronto and Vancouver may have an easier time finding jobs, but home prices there are prohibitively high. Other towns and cities are more affordable, but with less fertile job markets.

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Half of the peak millennials surveyed believed that the federal government’s new mortgage regulations have adversely affected the types of property they can afford, effectively pushing them into highly competitive, lower-priced market segments.

More than half of peak millennial purchasers across Canada are willing to spend up to $350,000, which would typically buy them a 2.5-bedroom, 1.5-bathroom property nationwide. Yet, with 58 per cent of respondents having an annual household income lower than $69,000, and only a third on track to have a down payment of more than 20 per cent in order to buy such a property, the logistics of home ownership are challenging.

Still, there are a few solutions for millennials to consider, including starting off with a condo instead of a detached property, and heading to more affordable real estate markets.

Need help selling your home or finding the perfect house?

With over 40 years experience, we’ve assisted thousands of Sellers and Buyers with their real estate and relocation needs. You can rely on our intimate market knowledge and professional service. Let us help you. 

Contact Us: 613-238-2801 mail@morrishometeam.com 

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