If the April 2023 new-home sales are anything to go by, the Ottawa market is definitely improving.
Numbers released in the most recent monthly report prepared by PMA Brethour Realty for the Greater Ottawa Home Builders’ Association show a marked improvement over both the year before and the month before.
There were 345 new-home sales in April, which was up 20 per cent compared to the 286 sold in April 2022 and up 77 per cent from March, when there were 195 sales.
“With spring in full swing, Ottawa new-home sales continue to go in the right direction,” says PMA Ottawa president Cheryl Rice. “It was this time last year when new-home sales started their steep descent into a market correction marked by aggressive interest rate hikes, high inflation and overall buyer uncertainty about the future.”
April 2022 marked the beginning of a deep sales slump that would last the rest of the year, resulting in a year of sales that were almost 50 per cent lower than the average. But while sales have improved recently, for the year to date, the 822 sales we’ve seen are still down 60 per cent compared to last year’s 2,053 sales.
Improved demand
Rice notes that inflation and high mortgage rates “continue to be factors in today’s price-sensitive market, (but) we’re seeing improved buyer demand coupled with significant builder incentives.” These incentives include some builders offering $100,000 off a home’s price, attractive appliance packages and reduced or extended deposit structures, she says.
Builders are also slowly resuming project launches, with Cardel Homes launching Ironwood in Riverside South in March and Minto Communities opening Parkside at Arcadia in Kanata in April.
The Parkside launch in particular resulted in something we haven’t seen much of lately: sales centre lineups. “Buyers waited for up to a day to purchase,” Rice says, and the initial release of 60 of its Metro stacked towns sold out on opening day. “The product, starting at the affordable price of $389,000, appealed to first-time buyers, families and investors alike.”
Despite the improved numbers in the April 2023 new-home sales, Rice strikes a cautionary tone. “While the future looks bright, we’re vulnerable to certain realities,” she says. “Ottawa is in a seller’s market with insufficient housing to meet demand. High interest rates and food costs will continue to challenge our budgets. Rental fees continue to climb, adding to the housing crisis. A recession, if there is one, may be mild, but can still impact peoples’ livelihoods, their financial stability and well-being.”
