The 2022 real estate year in the Ottawa Valley ended with a little bump in what can best be described as a year to forget if you are a realtor or an individual searching for that perfect home at a reasonably affordable price.
The number of homes sold through the MLS® System of the Renfrew County Real Estate Board totalled 83 units in December 2022. This was a substantial decline of 21 percent from December 2021 but still came in around average levels for this time of year.
The year started off slow and never really gained any momentum during the 12 months, a trend that the rest of Canada was mired in for the first eight months of the year.
In its final report of the year, the Canadian Real Estate Association (CREA) reported the national slower than usual real estate sales in the first half of the year was caused by a number of factors.
“In 2022, we saw one of the biggest single-year shifts on record in Canadian housing activity, from record highs last winter to just below the 10-year average to end the year,” said Jill Oudil, chair of CREA. “That said, the market’s adjustment to higher rates may be mostly in the rear-view mirror at this point. That could start to bring buyers back off the sidelines this spring.
Leading the way for the slump in sales was the uncertainty of the Canadian mortgage rates and the pattern of following the American bank rate that was drastically increased over the latter part of the year.
The Federal Reserve waged a war on inflation throughout 2022 and as a result the interest rate set by the Fed increased by a whopping 4.25 per cent during the 12 months. The high rate of inflation, the war in Ukraine, shortages of materials in the global supply chain all contributed to the massive increases.
In Canada, the Bank of Canada often followed suit. In October the cost of borrowing to purchase a home was determined by the national rate which sat at 1.75 percent. By December 2022, it was 4.25 per cent.
In Renfrew County, home sales were eight percent below the five-year average and six percent above the 10-year average for the month of December. On an annual basis home sales totalled 1,652 units over the course of 2022. This was a significant decrease of 25.9 percent from the same period in 2021.
The average price of homes sold in December 2022 was $402,804, down sharply by 10.1 per cent from December 2021.
The more comprehensive annual average price was $465,948, an increase of 14.2 per cent from all of 2021.
The dollar value of all home sales in December 2022 was $33.4 million, a big reduction of 28.9% from the same month in 2021.
The number of new listings increased by 8.2 per cent (five listings) from December 2021. There were 66 new residential listings in December 2022.
New listings were 9.1 per cent below the five-year average and 21.7 per cent below the 10-year average for the month of December.
Active residential listings numbered 226 units on the market at the end of December, more than double the levels from a year earlier, surging 113.2 per cent from the end of December 2021.
Active listings were 20.3 per cent below the five-year average and 55.5 per cent below the 10-year average for the month of December.
Months of inventory numbered 2.7 at the end of December 2022, up from the one month recorded at the end of December 2021 and below the long-run average of 7.3 months for this time of year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.
