It looks like the continuing low inventory of available homes has finally caused slippage in Ottawa’s resale market.
And it may be a sign of things to come for the local resale market, according to the Ottawa Real Estate Board.
Still above average
Board members sold 780 residential properties in January through the Multiple Listing Service (MLS) System, a drop of 4.5 per cent from the 817 transactions in January of 2019. Both residential-class properties and condos took a hit, although the total number sold was still higher than the five-year average for January of 713.
That dip followed months of double-digit sales increases and a record-breaking 2019 for the local resale market despite a long-running problem of limited inventory.
“2020 is off to a slower start as the shortage of inventory is now impacting market momentum,” said board president Deborah Burgoyne in a statement. “(The) persistent supply challenges seem to have finally caught up with us. Furthermore, the number of new listings that came on the market in January (1,082) is well below the average (1,651).”
Burgoyne doesn’t expect that trajectory to change anytime soon. She said the entire supply chain needs to be buffered to meet the demands of all buyers from first-timers to downsizers.
Sales dip or not, the average sale price for a residential property last month was $516,229. That was an increase of 19.3 per cent from a year ago and well above the $500,716 average that, coming in June of last year, signalled the first time the Ottawa resale market had cracked the half-million dollar mark.
The average sale price for a condominium-class property last month was $338,077, a jump of 19.1 per cent from the same month last year.
The board’s Housing Price Index (HPI), a measure based on the specific housing stock in neighbourhoods, shows a slightly lower benchmark price increase in January of 13.75 per cent over last year.
While supply may eventually increase, Burgoyne cautioned, “if buyers are waiting for prices to decline, based on historical trends, it’s not likely.”