Toronto homeowners cash out to live mortgage-free in Ottawa

New Royal LePage survey finds Ottawa home prices up 5.6% in Q1
Home price

Sarah Blakely recalls feeling some trepidation when she and her husband shelled out more than $300,000 for a modest 1 1/2-storey house in a less-desirable part of Toronto.

Seven years later, they found themselves on the right side of a hot housing market, with values tripling in a 'hood suddenly considered up-and-coming for young families seeking detached homes.

They recently sold that renovated three-bedroom for more than $1 million and now expect to live mortgage-free in a four-bedroom purchase in their hometown of Ottawa.

The 34-year-old says it made sense to cash out of a city that was draining their finances, energy and family time.

"My husband and I saw an opportunity to take advantage of the recent gains in real estate and to move to a less expensive city to live mortgage-free, support our savings for retirement and also to be closer to family," says Blakely, whose new home has nearly twice the square footage.

And they may have taken action at just the right time.

Blakely's real estate agent Josie Stern says the market appears to be cooling, and doubts Blakely could fetch that same jackpot sale today.

"A little bit of air has been let out of the bubble," she says.

In Ottawa, however, a new report Tuesday said home prices continue to appreciate.

A Royal LePage House Price Survey said the aggregate price of a home in the nation’s capital increased 5.6 per cent year-over-year in the first quarter to $418,178.

The same report found that the median price of a two-storey home increased 5.6 per cent to $437,247, while condominiums increased three per cent to $324,455.

“While we are seeing less inventory overall and fewer new builds becoming available, Ottawa’s residential real estate market is still extremely strong and consistent,” said John Rogan, broker of record at Royal LePage Performance Realty.

Many buyers and sellers are waiting to see what will come of Tuesday's scheduled meeting between Finance Minister Bill Morneau, Ontario Finance Minister Charles Sousa and Toronto Mayor John Tory, who are expected to discuss ways to rein in Toronto's hot housing market.

Meanwhile, the Ontario government is promising to announce affordability measures soon.

Stern says some buyers are delaying their purchase in anticipation of possible fixes.

– With a report by OBJ staff