Ottawa’s real estate market remains red hot despite economic uncertainty caused by the COVID-19 pandemic.
A recent report from the Ottawa Real Estate Board said sales of residential properties, including condos, increased by 17 per cent in August compared to the same month the year before, while prices increased between 22 and 24 per cent — to $383,000 and $592,000 — for condos and freehold homes, respectively.
“Ottawa’s market right now is hot, hot, hot,” said Kim Tran, a sales representative with RE/MAX Hallmark and who runs “Team Tran,” a boutique real estate group in Ottawa.
“It is a seller’s market. They’re doing very well. A lot of people are capitalizing on the situation right now and putting their house on the market.”
She witnessed an Orléans home sell for $250,000 over asking last month. She said part of the reason for high prices are relatively low asking prices in the suburbs.
“The housing price to start with is very conservative. It’s not that high. So right now, it’s really just catching up and a lot of people find there’s more value out there.”
Ottawa economy looks stable
“Ottawa is a very different city compared to the rest of the country. We’re living in a government town so a lot of our jobs are quite stable compared to a lot of other cities,” she said.
But the scorching market is also making it difficult for buyers.
“A lot of times they have to compete in bidding wars or multiple offers and a lot of times they have to go in with very few or no conditions,” said Eric Ritterrath, a real estate broker with Royal Lepage Team Realty.
The federal government as a main employer and low interest rates — giving people more buying power — are also driving the market
“When you have economic stability, it gives confidence to buyers… they can afford to overbid,” he said.
Stressful for first-time buyers
Keerthi Rajan, 31, is one such first-time buyer who didn’t expect the competition he’d faced finding a home, despite moving from Toronto earlier this year.
“It was quite challenging to find a house that you really like,” he said.
He and his wife started seriously searching for a house in June and put offers on seven to eight homes, but were always out bid.
Keerthi Rajan looked at around 15 houses, and bid on several homes, before finally winning a bid on a home in Bells Corners, in Ottawa’s west end, in August. (Supplied by Keerthi Rajan)
“It was really stressful,” he said.
The couple finally secured a home in Bells Corners in August and are set to move in next month. He said the housing market in Ottawa is more affordable than in Toronto, but he sees some familiar trends.
“I’m feeling that it’s slowly turning into a Toronto market.”
“While it will take several months for the economic impacts of COVID-19 to fully materialize, some factors are starting to work their way into in our financial results — for example, we are starting to see the impacts in our provisions for insurance claims,” said Lisa Williams, CMHC’s chief financial officer, in a statement on the corporation’s second-quarter financial results last month.
The housing market will have to reckon with significant short-term uncertainty, as well as falling housing demand from weaker household incomes in the medium term, the Crown corporation said.
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.
