The Ottawa real estate market continued it’s downward trend in July. With higher mortgage rates, more inventory and higher cost of ownership, prices gave up significant territory on a month-to-month basis.
Prices are down about 15-20% from the February/March 2022 peak.
- Detached homes gained 4.8% from a year ago. They were down about $60,000 on a month to month basis.
- Townhomes were up 3.0% compared to a year ago and lost about $40,000 on a month to month basis.
- Condos gained about 11% compared to a year ago and were down about $15,000 on a month to month basis.
Days on market is rising fast, inventory is going up and properties sold is declining. This is a perfect storm for prices. Even with lower prices, the cost of ownership is significantly higher than one year ago.
For example a home with a purchase price of 600K and a mortgage of 500K will cost about 3K in mortgage payments at today’s rates (approximately 5.25%). When 5 year rates were 2%, the mortgage payment would have been about $2,100. A significant difference of $900 per month.
For those interested in recent sold prices in Ottawa, Ottawa real estate sold prices are available via my site https://ottawarealestatesoldprices.ca. Please note, you will need to register and sign-in in order to access sold data.
Key Insights for Buyers:
Buyers have the upper hand at the moment. I am seeing daily price decreases in listing prices. Buyers should be negotiating prices and factoring in continued price declines over the next 3-6 months.
Key Insights for Sellers:
Sellers are still in a decent position to sell their property. There are still buyers out there abiet at lower prices. Homes that are staged and priced correctly are selling in about 2-8 weeks.
I anticipate further price declines for the Ottawa real estate market. In my opinion there is still another 10-20% of price depreciation to come.
Rising variable rates and the ultimate higher cost of ownership are the biggest challenges for prices. There is a chance that the federal government will play with the stress test in order to lower the barrier to ownership.
I am always happy to answer any real estate related questions you may have.
Sales Representative / Sutton Group – Ottawa Realty / Brokerage, Independently Owned and Operated
Hintonburg – Orleans – Kanata
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