“We’re doing much better this year, year to date, than we did last year,” observes Patrick Morris. “The number of sales is up, and the inventory is down between 10 and 12 per cent, depending on location. This is creating a nice, balanced market in most price ranges.”
He cautions, however, that “in some of the price ranges, there are homes where it’s still a buyer’s market. Homes that require a lot of updating are taking much longer to sell; they may not even sell within 90 days.”
Members of the Ottawa Real Estate Board sold 1,985 properties through the Multiple Listing Service (MLS) in June, exceeding May sales figures by 64 properties and besting the five-year average for June sales by 268 properties. Of the 1,985 units sold, 1,654 were residential properties and 331 were condominiums. The most popular price range for homes sold in June was between $300,000 and $400,000, followed by the $400,000 to $500,000 range.
The absorption rate continued to move in the right direction for residential properties. Absorption rate is a key market indicator that gives an idea of the relationship between housing inventories and sales—specifically, how long it could take for all current listings to be absorbed in the market.
Put another way, the ratio shows how many months it will take to sell all listings without any new listings entering the market. In June 2016, it would take 3.5 months to sell all listed residential properties based on the number of sales that month; in June 2015, it would have taken 4.7 months.
It is taking considerably longer to sell condominium properties, which had an absorption rate of 6.0 for June, but there was a respectable increase in the number of sales this year to date compared with the first half of 2015. On another positive note, the inventory of condos available for sale—which has been high—dropped 9.4 per cent in June compared to this time last year.
The Ottawa market is likely to maintain a consistent number of sales for the year, says Patrick, with the caveat that interest rates could go up. “Economists have been predicting for about 10 years now that interest rates are going to go up,” he says. “We have yet to see it. All indicators are that interest rates will remain similar for the balance of the year.”
And so, Ottawa’s market enters the summer “steady as she goes,” concludes Patrick.