Rinse and repeat — July 2023 new-home sales “held no surprises,” says Cheryl Rice, who is Ottawa president of industry analyst PMA Brethour Realty Group.
In PMA’s latest report prepared for the Greater Ottawa Home Builders’ Association (GOHBA), new-home sales in July were 190, which is up significantly over the 82 sold in July 2022 — 131 per cent, in fact — and a similar pattern to what we saw in June. However, that whopping increase is misleading since “the market was in the thick of a correction,” she says, and sales overall for the year are still down quite a bit. For the year to date, there have been 1,548 sales, versus the 2,417 sold in 2022 and a cumulative total that is the lowest in well over a decade.
“I think the (July) increase does show how sensitive buyers are to instability in interest rates, and that lack of consumer confidence is contributing to pent-up demand for housing,” adds GOHBA executive director Jason Burggraaf. “My hope is that this is the start of monthly year-over-year increases, as we desperately need more housing for our growing population.”
Sales were also down from June, which is typical heading into summer. There were 9.5 per cent fewer sales in July than there were in June.
Improved outlook
“Overall, July new-home sales performed as expected, with an improved outlook for the last half of 2023 as consumers become accustomed to the higher mortgage rates and builders continue to adapt to buyer demand and price sensitivity,” Rice says.
The report, which showed the suburbs with the lion’s share of sales, particularly the south end, and which showed more than three-quarters of sales in singles and towns, “reinforces that ground-oriented housing continues to be the most desired and sought-after type of housing for Ottawans and their families,” says Burggraaf.
Townhome demand remained strong, capturing 57 per cent of the market. “Townhomes, which hold the largest supply in the city, performed remarkably well in July due to their appeal to a broad demographic, affordability and, for some townhome products, significant price adjustments and incentives to help spur sales,” says Rice. “Buyers are also sacrificing square footage for lower prices.”
