August ‘23 Market Update
August Real Estate Market Update: Where did the Summer go?
It’s time to brush up on what’s been happening in Ottawa’s real estate market! Let’s dive into August.
Sales Volume and General Thoughts
August 2023 (AKA the shortest summer ever) saw a total of 1,196 residential sales via the MLS® (Realtor.ca). Compared to August ‘22 this marks a 6% uptick in sales. Of this value 903 properties were freehold-class properties while 293 were condo-class properties. This marks a 7% and 2% increase from the previous August respectively. Lastly, the 5 year average for August sales sits at 1,525 - meaning a real slowdown from the previous years.
Mr. Ken Dekker (President of RECO) has shared his opinions once again noting that sales activity is up over 2022 but lower than the 5 year average. He also takes note of increased immigration driving demand upwards which despite the current trends I tend to agree with moving into the future. A combination of high borrowing costs, lack of affordable housing, and skyrocketing home prices makes this market one of the least fun to purchase in. That being said, we are expected to have a record number of immigrants moving to Canada from now until 2030. Because of this wave of immigration I suspect that even with less than ideal interest rates we will see an increase in home prices in the next few years. According to CMHC we currently do not have the number of homes to house all of the pent up demand. This doesn’t even take into account the additional pent up demand of Canadians in the Millennial demographic. I suspect further rate hikes moving forward but I’m unsure how permanent of an effect they will have on our housing market.
Janice Myers, the CEO of OREB, has chimed into the discussion around affordability and speaks to City of Ottawa’s allocation of $110 Million that is being directed toward affordable housing. Even though this is positive news, many Ottawans will still find housing to be out of reach for the near future. Janice states that collaboration among all tiers of government is critical to address our housing debacle. Higher density city-scapes is also a topic being thrown around with no current concrete resolution in sight.
Average Sale Values
In August, the average sale price for a freehold-class property was $709,739. This represents a modest 0.5% increase from 2022 but is a 5.6% decrease compared to July ‘23 prices. Condominium-class properties saw a 1% increase over August ‘22 putting the average sale price at $425,968. Unfortunately this means a 1.4% drop from July ‘23.
YTD average sale prices are at $732,220 and $432,571 for each respective class of property. This represents an 8% decrease for freehold-class properties and a 5.5% decrease for condominium-class properties compared to the same time as last year.
Inventory Count
August's new listings totaled 2,228, which was on par compared to July ‘23 but was a large 7% increase from the previous year. The five-year average for new listings in August is 2,177. Freehold-class properties, the months of inventory increased to 3 months from 2.7 months in July 2023. Condominium-class properties inventory experienced a slight decrease from 2.3 months in July 2023 to 2.2 months.
Days on market (DOM) for freehold properties increased to 31 days from 26 days in July ‘23. For condominiums, the DOM increased to 29 days from 28 days as of last month.
That about wraps it up! Again We hope these statistics and thoughts prove useful to you when looking at the market and trying to untangle this web. As usual if you would like to discuss the market with either Janda or I we would be happy to sit down with you and have a chat!
Keep in mind the stats mentioned above are merely general statistics accumulated from the whole of Ottawa. Certain neighbourhoods and specific properties may be outliers to these general statistics and if you are curious how your property fits within the data range its always best to reach out to either one of us for clarification.
Fall is in the air….. See you for September’s market update!
Alex
