Realtor Yvan Rhéaume says Ottawa is still a hot real estate market, but buyers have a better chance of competing for homes now compared with last winter.
“The craziness is over,” Rhéaume said on Sunday, but that doesn’t mean it’s less expensive to buy a home in the nation’s capital.
“What you see on the news is the prices are dropping and sellers are panicking. That may be the thing in other places across the country, but in Ottawa, we still see a price increase between 2021 and 2022,” Rhéaume said.
Thursday, the Ottawa Real Estate Board released its analysis of July listings and sales and declared a “profound slowdown” in the local home resale market.
“July’s numbers reveal that buyers are indeed putting on the brakes more heavily than what is typically releasing during the mid-summer sales dip,” board president Penny Torontow said in the latest statistics.
According to the board, its member realtors sold 1,100 residential properties in July 2022, compared with 1,718 in July 2021. The stats come from listings on the Multiple Listing Service (MLS).
The July 2022 sales were well below July’s five-year monthly average of 1,691.
Prices are still increasing, but just not at the same steep trajectory seen earlier in the pandemic.
According to the board’s figures, the average sale price for a residential property was $716,354 in July, an increase of five percent from a year ago. For condos, the average sale price went up one percent to $425,694 in July 2022, compared to the same month in 2021.
When it comes to year-to-date average sale prices as of July, the board has the first seven months of 2022 at $805,238 for residential properties, which is an 11-per-cent increase over the same period in 2021, while condos were at $461,557, a nine-per-cent increase.
Rhéaume said the return of one not-long-ago standard shows a change in the market: conditions are once again being put on offers.
He had one buyer recently purchased a townhouse with conditions on financing and a home inspection. “That was the first time in probably three years, at least,” Rhéaume said of the conditions. On top of that, he was able to negotiate the price.
Wendy Bell, the broker of record in an office of 250 agents, said news about higher interest rates and inflation had an impact on the market starting in the spring.
“That kind of put the brakes on things,” Bell said, opining that another interest rate increase would be “devastating.”
Bell said she finds herself trying to educate buyers and sellers about what’s happening in the local market.
Sellers have watched properties go for sums well beyond asking prices during the pandemic, while buyers have recently been reading about the market quickly returning to normal conditions. Both scenarios aren’t necessarily playing out in Ottawa.
Bell said homes didn’t have to be staged at the height of the buying frenzy over the pandemic, but now she’s urging sellers to make sure their homes are in order — like painting and removing clutter — to attract prospective buyers.
Bell said the months ahead will provide better indicators for the local real estate market as people come back from their summer vacations.
“Things will come back to normal in a more balanced market in the fall,” Bell predicted.
Broker Dawna Erskine said some sellers have been confused about why their homes aren’t attracting the same large offers that some neighbors received just months ago.
“That’s how drastic things have changed,” Erskine said, and she believes “we are going back to the pre-COVID days” when it comes to home prices.
Erskine said the pandemic has been a “nightmare” while trying to evaluate true values of properties for her eager buyer clients and trying to bid on homes against others willing to pay sky-high prices.
“I can’t tell you how often I’ve worked to guide buyers (and advised) not to buy this,” Erskine said.
“Is the winner really the winner? Or are you the loser?”
Erskine’s optimistic stability will return to the real estate market in the coming months.
“It’s going to become more balanced and I’m really looking forward to it.”