OTTAWA —
There has never been a more intense housing market in Ottawa than there is today.
Prices are through the roof; which is great for sellers, but buying a house in today’s market might not be as simple as you think.
Tanya Trevors and Chris Armstrong were lucky enough to purchase their dream home just before COVID-19 hit the capital last year, but that doesn’t mean it was any easier.
“Couple hundred thousand dollars I would say, more than our budget,” says Armstrong.
Trevors adds, “Yah, we did get into a bidding war. There was one other person bidding on the house. So we did end up overpaying for the house.”
The market was just starting to heat up to what we see today. They avoided the spike, but still spent about $50,000 over asking.
“We were looking for almost a year,” says Trevors. “And we’re really happy with what we got. So my advice would be to be patient.”
Dominique Milne is a real estate broker in Ottawa. She says low interest rates, combined with the government and high tech sectors in the capital, have created a perfect storm for sky high prices in Ottawa.
“We have record low interest rates, which are certainly funnelling some fire,” says Milne. “It’s a fantastic time to sell. Everything is selling. We’re down to 16 days on market for February. We haven’t seen that ever. But for buyers, it is hard. The competition is fierce. You have to have your ducks in a row. Conditions? Forget it.”
Andrea and Scott Martin have put down nine offers on nine houses, each time being outbid by other buyers.
“We’ve been looking for almost two years,” says Andrea. “We’ve gone up to almost $170,000 over and still not gotten the house.”
Over the course of two years, prices have risen so high, the Martins say it’s near impossible to get what they were originally hoping for.
“When we started looking for houses, we were looking in a range of around $400,000, and they were nice properties,” says Scott. “And now when we look at anything of the same quality, it’s almost double the price.”
They say they are quickly running out of hope, and options.
“Eventually we’ll be priced out of the market if the prices keep going up the way they are,” says Andrea.
The pandemic has had a lot to do with people’s lifestyle change and working from home, causing a supply and demand issue. It’s changing the way people work, and what most families need during these times.
“Suddenly you have two people working at home. Two kids at home on and off. And we’ve gone from needed three bedrooms to needing five bedrooms and an extra space for people to separate from themselves,” says real estate broker Daria Kark.
Kark adds a lot of homebuyers are being squeezed out of the market by investors.
“Current rates of two per cent or so for a five-year fixed mortgage, you know, you can’t make that much on a regular investment. So people are just investing in their mortgages. They’re investing in their real estate.”
But as frustrating as it is to be a home buyer today, the Martins have not lost all hope just yet.
“We’re offering on another house tomorrow,” says Scott. “Offering over asking, no conditions. Same as every house we’ve bid on. We’ve never had a condition and it never seems to matter. So we don’t get our hopes up anymore, but we keep trying.”
The Ottawa Real Estate Board reported record sales in February.
A total of 1,390 residential properties were sold in Ottawa last month, up from 1,134 in February 2020. The average sale price for a residential-class property was $717,914, an increase of 27 per cent from a year ago. Condominiums sold for an average of $407,671, an increase of 17 per cent from February 2020.
The sales volume for residential properties and condos in Ottawa was $885,592,105 in February, 54 per cent higher than the same month last year.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
