The Ottawa housing market appears to be falling back into a more “normal” rhythm in fall of 2021, with the number of new listings and sales expected to align more closely to 2019 figures, according to broker Kevin Grimes of RE/MAX Affiliates. However, the housing supply shortage will continue to weigh on Ottawa real estate, much like the rest of Canada, where seller’s market conditions are present in 26 of 29 regions analyzed in the RE/MAX Fall 2021 Housing Market Outlook Report.
Average residential prices for the Ottawa housing market are expected to continue their upward trajectory through fall, with Grimes anticipating at least a 2% increase per month for the remainder of 2021.
Ottawa is still experiencing a shortage of houses for sale, with interested buyers and new listings decreasing slightly. The houses that are available for sale aren’t sitting on the market very long, averaging about 20 days. This is an important measure, as it tracks how long it will take to liquidate current housing inventory at the current rate of sales.
Young couples and retirees are driving demand in the region, which continues to sit in seller’s market territory. Single-detached homes have seen the largest increase in average residential sale prices year-over-year, with a 26% increase; followed by townhomes at +21%; and condos at +16.4%.
Total unit sales in Ottawa are expected to rise 21% year-over-year across all property types, with the average sales price across the Ottawa housing market anticipated to increase by 4% by the end of 2021.
Looking at the bigger picture, Ontario real estate has seen some of the highest single-detached price gains in the country, with 13 out of 16 Ontario housing markets examined in the report seeing growth between 20% and 35.5% year-over-year. The outlier markets that experienced price increases below 20% include Toronto (+14.6 per cent), Thunder Bay (+17.1 per cent) and Mississauga (+19.7 per cent).
Meanwhile, condos and townhomes in some smaller and suburban Ontario housing markets such as Kitchener, North Bay, London, Peterborough, and Southern Georgian Bay, experiencing a higher price surge year-over-year. The estimated price outlook for the remainder of the year ranges from a 2% price decrease in North Bay, to increases across the other regions ranging between 2% and 15%.
National Canadian Housing Market Trends
Conditions in the Ottawa housing market are echoed across the rest of the country, with single-family homes seeing the most pronounced price increases year-over-year in 2021, rising between 6.8 and 27.3 per cent across 26 or 29 markets surveyed in the report. And much like Toronto real estate, activity in this property segment is being propelled by strong demand by young families, a trend that RE/MAX brokers and agents expect to continue through the fall.
The average residential price in Canada, across all housing types, is anticipated to increase by 5% in the remaining months of 2021.
“Housing activity throughout the pandemic has remained strong, so it comes as no surprise that the outlook for the remainder of the year continues on an upward trajectory, which is great for homeowners and their equity, but challenging for first-time buyers who have been priced out of the market,” says Elton Ash, Executive Vice President, RE/MAX Canada. “We must continue to educate Canadians from a practical, real world, point of view. What is affecting the Canadian housing market right now? Low Interest rates, economic stimulus, higher home-buying budgets, a higher savings rate, homeowners too scared to sell, and not enough new construction. These factors have created current market conditions.”
Adds Alexander, “The Canadian housing market has historically given homeowners great long-term returns and solid financial security, but there’s no doubt that the rapid price growth we’ve experienced recently is cause for concern. However, it’s not cause for panic. The data shows single-detached home price acceleration may be starting to level off in some urban centres, but prices continue to rise in many smaller cities and communities that were once havens for affordability. Real estate has been a boon to the Canadian economy, during the pandemic and before it. We believe in the long-term health of Canada’s housing market, but in order to protect it, we need to acknowledge and address the housing supply shortage. Our current government needs to stop applying band-aids and cure the problem at its root.”