Ottawa’s June 2022 resale market took a nosedive, with transactions down 29 per cent compared to the same month last year, reports the Ottawa Real Estate Board. June was the fourth month in a row that the board has reported a sales drop.
Realtors sold 1,508 properties last month through the board’s Multiple Listing Service (MLS) system. Last June, they sold 2,122 properties, while the five-year average is 1,966.
Sales last month comprised 1,138 non-condo properties and 370 condominiums.
For the year to date, sales are down more than 16 per cent. That number would be higher had it not been for strong numbers in both January and February.
“After the frenzy of the past two years, we are witnessing Ottawa’s resale market normalize in 2022 and shift towards the more traditional seasonal ebb-and-flow cycle,” said board president Penny Torontow in a statement. However, she added, “while June transactions do typically taper as many look towards their summer holidays, last month’s sales were at a slower pace than we have seen in well over a decade.”
Inflation and more to blame
Torontow said the decrease in unit sales can likely be attributed to economic factors such as rising interest rates, inflation, buyer fatigue and a wait-and-see approach towards home prices. She also pointed to uncertainty around back-to-work arrangements, long commutes and rocketing gas prices affecting decisions about where to live.
Ottawa’s new-home sales are also down substantially in recent months and some other Canadian cities are reporting similar slowdowns in the resale housing market. Toronto, the nation’s largest city, saw sales plummet 41 per cent last month compared to last year and Vancouver experienced a 35-per-cent slide. Rising interest rates and commute-to-work distance are being blamed in those cities just as they are in Ottawa.
MORE: Resales slow again in May
Prices slow, inventory grows
Resale prices, which have been soaring in Ottawa over the past couple of years, also calmed in June, especially condominium prices. Non-condo properties sold for an average $772,861, an increase of six per cent over the same month last year. Condos averaged $438,977, just one per cent higher than a year ago.
Year-to-date, non-condo prices are up 10 per cent compared to 2021 and condominiums are up 11 per cent.
“There’s a new (price) benchmark reality in Ottawa,” said Torontow. “While our average price statistics provide an overall picture, as the market settles, there will be adjustment differences in various pockets of the city. For example, what happens in Westboro will not likely mirror Findlay Creek.”
Torontow doesn’t believe prices will drop drastically in Ottawa. Instead, she thinks they will level off and then increase at “reasonable” levels.
Ottawa’s housing stock is also improving, according to the board. Non-condo inventory is up 38 per cent over last year and condo stock has increased 14 per cent. Rather than the sellers’ market that has been the reality over the past few years, Torontow says the growing inventory is a sign we are moving toward a more traditional balanced market.
