Encouraging Signs Emerge for Real Estate Market as Spring Finally Arrives in Ottawa

Home buyers in Ottawa are coming out of hibernation. Although the real estate market had a sluggish start to the year—and frigid temperatures didn’t help—home sales are starting to trend upward.

“We’re getting a lot of traffic at open houses,” observes Patrick Morris. “We’ve been deluged with the number of attendees, and they tell us they’re serious buyers. Hopefully, this will translate into sales very soon. I think this is really positive.

“Things overall are starting to get better,” continues Patrick. “The market’s a little bit more active than it was last April. We expected a better first quarter than last year, and the results speak for themselves. Residential sales increased by 4.9 per cent over the first quarter of 2014. However, the residential inventory is much higher than in 2014. It’s increased by about 11 per cent. The same goes for the condo market. The inventory is way up.”

In fact, condominiums have been selling at a decreasing rate since 2012. In March 2012, the number of months it would take to sell all listed condos was 4.3; at the end of March 2015, it would take 8.6 months for the market to absorb the condo inventory. “It’s not a surprise that this figure has doubled,” observes Patrick, “because the number of condo listings is up almost 64 per cent in March 2015 compared with the end of March 2012. The new condo developments are really contributing to the oversupply, and it’s going to take another year and a half, maybe even longer, for that amount of inventory to be absorbed by the number of sales per month.”

Another important factor to note is the average number of days that properties remain on the market. “For residential properties (apart from condos), this year the average cumulative days on market is 94; in 2014, it was 75. It’s taking about 25 per cent longer to sell this year,” says Patrick. For condos, it’s taking about 107 days to sell—10 per cent longer than in the first quarter of 2014.

But positive signs are emerging, and certain areas of the market are doing especially well. Ottawa Real Estate Board president David Oikle notes, “The hottest segments of our market in March were sales between $300,000 and $400,000, followed by the $200,000 to $300,000 range. Residential two-storey homes continue to be the highest-sold property class, followed by bungalows and one-level condos.”

Patrick notes another positive trend: “Between the $400,000 and $500,000 price range, residential sales in the first quarter of 2015 are up 10 per cent over the first quarter of 2014. It’s very promising.”

This, combined with the increasing number of emails from buyers and the burgeoning attendance of open houses, leads Patrick to conclude, “I’m encouraged by what I’m seeing. The hibernation is over.”

A Note About Susan

As some of you may be aware, Susan was in a bad auto collision nearly two and a half years ago, and suffered a major concussion. Although her condition has been improving, Susan needs to focus on her recovery. After 37 years in real estate—during which she was instrumental in establishing a thriving team and helping countless people buy and sell their homes—she is now putting the same devotion toward her health.

The entire Morris Home Team would like to express our sincere gratitude to Susan for her many contributions, both to the team and to the wider community. Throughout her career Susan earned numerous accolades, including Royal LePage’s awards, thanks to her hard work, sharp-eyed attention to the market, and unwavering attention to clients. She also gained many friends and much respect through her devotion to charitable work. Over the years, Susan has assisted the Morris Home Team in hosting or sponsoring many events, including fundraisers for the Make-A-Wish Foundation for Eastern Ontario, the Dave Smith Youth Treatment Centre, the Dovercourt Community Centre, festivals such as WestFest, and many local initiatives.

Although Susan needs to step away from her day-to-day role at The Morris Home Team, she will continue to be a special advisor to the team that she helped propel.

Patrick quips, “She must be feeling better because she’s started to boss me around again!”

ASK PATRICK

Should I buy a brand new home or a resale home? What are the pros and cons?

Choosing a home is one of the biggest decisions you’ll ever make. 

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No matter whether you go with a brand new home or a resale home, there are going to be pros and cons. Figuring out which of the considerations below are most important to you will help you decide what’s right for you.

NEW HOME

PROS:

Custom design. You get to choose your own lot, house layout and design, and the finishings for the kitchen, bathrooms and flooring. Instead of inheriting someone’s choices, you can choose everything to suit your taste.

• Everything is shiny and new.

• New homes come with a full Tarion home warranty. (Tarion, a private corporation, regulates new home builders in Ontario and aims to protect the rights of new home buyers.)

 

CONS:

Higher costs and more risk. Though a new home can be built to have the exact style and features you want, this usually comes with higher costs, limited choice of location, and more risk.

HST/GST is applied to the price of a new home, and can significantly increase your overall costs.

• Although the properties will be sodded by the builder, extras such as patios, fences and landscaping are the buyers’ responsibility. In a subdivision, you’ll need to plant your own trees.

• Unless you can get an infill house in an old neighbourhood, new homes tend to be in suburban areas, which can mean a much longer commute.

• It takes time for infrastructure to materialize in new developments, i.e., roads, transit, schools, community centres.

 

RESALE HOME

PROS:

HST does not apply to resale homes; they are exempt from the tax.

• Existing homes tend to be in established neighbourhoods, which can give you an accurate sense of what the community will be like to live in. All of the infrastructure is mature and in place, and “what you see is what you get”—that is, there won’t be any surprises when it comes to the housing types surrounding the property.

• In most cases, the landscaping is in place — including fencing, decks and patios.

• Most resale homes come equipped with appliances and window coverings and often have finished basements.

 

CONS:

No Tarion home warranty for resale homes.

Costs of repairs and maintenance. Upkeep for an older home can be more expensive, given the older appliances, plumbing and electrical systems. You may need a new roof or a new furnace sooner than you think. Old windows and inadequate insulation can drive up heating bills. There may be unexpected costs associated with repairs. 

SPRING CLEANING: Getting Your Home Ready for Listing

Room by room, here’s how to get your home in tiptop shape for sale:

Front Hall: Make a fantastic first impression by having a bright, clean entrance to your home. Keep the area clutter-free, with a minimum of furnishings and wall art.

Kitchen: This room—the Grand Central Station of home life—gets a lot of attention from buyers. Ensure that your fridge, cabinets, drawers, pantry, etc., are clean and not over-stocked. This is the time to get rid of last week’s lettuce and that jar of pickled turnips you never use.

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Living Room, Dining Room and Family Room: Depersonalize and declutter as much as possible, so that buyers can truly appreciate the space and see themselves living in it.

Bedrooms: Make the master bedroom a haven of serenity; clear away clothes, shoes and personal items apart from, say, a book on the night table. Avoid using other bedrooms to store all the stuff you cleared away from the master bedroom. On that note, empty closets by a half or a third, to give a sense of space—and leave nothing on the closet floor.

Bathrooms: Clear counters and shelves, and, for safety’s sake, remove all prescrip­tion items. Store away toothbrushes and hairbrushes and, for that matter, all other brushes. Unless you have pristine new towels to hang, store towels away from view.

Attics, Basements and Garage: Keep these areas as neatly organized as possible. Store your stuff in labelled containers to give buyers the impression of adequate storage space.

Outdoors: Make sure your home’s curb appeal extends all the way to the backyard. Have a few nice furnishings on the patio, such as a table and chairs and barbecue, to convey the function of the area.

Staging your home by depersonalizing and decluttering may take effort, but it will pay off not only in helping to sell your current home, but in making your future home that much more pleasant.