The Ottawa housing market continues to surprise, with new home sales surging ahead in July and resales holding their ground.
Sales of new homes in July were a whopping 39.6-per-cent higher than July 2016 (465 sales versus 333) and up almost 41-per-cent higher than the five-year average of 330, according to the latest report from industry analyst PMA Brethour Realty Group.
And while July new home sales are down more than 30 per cent from the “blockbuster” 702 sales in June, July is traditionally a slower month for sales.
Defying expectations
“In the grand scheme of things, the market in Ottawa continues to defy expectations,” PMA Ottawa president Cheryl Rice says in a release, calling it a “joyous July.”
What’s not clear, Rice says, is whether the activity is a result of last month’s interest rate increase by the Bank of Canada.
“Whether rumours about higher interest rates subsequently dissuaded potential buyers from purchasing, or the anticipation leading up to the increase actually persuaded a significant number of buyers to buy, is unclear.”
Forest fire effect
What doesn’t seem to be dissuading buyers is higher prices, which are partially due to a reduced lumber supply as a result of forest fires in British Columbia forcing mill closures.
“Some builders have already started to pass on the additional cost to buyers with recent price hikes, while other builders are still evaluating the situation before their next price increase,” Rice says.
The condo market in particular is rebounding, with a rebalancing being seen, particularly in the resale market, which is up by nearly a third over last year.
Richcraft takes the lead
Richcraft continues to be a popular choice for new homes as the builder jumped to top spot in market share for the month – with 17.2 per cent – over usual frontrunners Mattamy (14.2) and Minto (12.7). (Minto and Mattamy retain top market share for the year, though, at 19.5 per cent and 17.4 per cent respectively, with Richcraft next in line at 11.3 per cent.)
eQ also had a stronger-than-usual showing, as did Uniform, Urbandale and Claridge.
Housing starts are also strong, trending in July at 9,144 units, compared to 4,463 in July 2016. The actual starts – 802 – were up 95 per cent from the previous year.
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