Much as we saw in October, entry-level homes — specifically condo towns — proved popular but were not enough to lift the sagging market when it came to November 2023 new-home sales.
There were 209 sales in November, according to the latest market report prepared by industry analyst PMA Brethour Realty Group on behalf of the Greater Ottawa Home Builders’ Association. While that’s up an astounding 318 per cent compared to the paltry 50 new homes sold in November 2022, the market had fallen off a cliff in the latter half of last year, so any improvement would look good.
Compared to the five-year average, the market is still not performing well.
“November and year-to-date new-home sales fell significantly below their five-year averages as high mortgage rates, shrinking disposable incomes and a shortage of affordable housing continue to suppress housing demand,” says PMA’s Ottawa president, Cheryl Rice.
For the year to date, there were 2,420 new-home sales, down 10 per cent from the 2,714 sold last year.
“Consumers should expect market conditions to be a bit bumpy over the next several months,” Rice says, although she adds that there’s “a bright spot on the horizon in 2024 when the Bank of Canada is expected to make its first cut to its five per cent benchmark rate.
“A decrease in the interest rate would send a positive signal to the consumer, unleashing pent-up demand to fuel sales in the latter half of 2024 and into 2025.”
The sale of freehold townhomes and condo towns dominated market share, capturing 72 per cent of total sales in November, Rice notes. “Minto and Mattamy condo towns, which appeal particularly to first-time buyers and investors due to their affordability, were sold as quickly as they were released, and combined made up 24 per cent of total product sales for November. We can expect to see more of this product type being offered in the future.”
