Dwindling supply driving up Ottawa residential resale prices: OREB

sold

The chill most of us felt throughout January didn’t seem to apply to the Ottawa real estate market.

Ottawa realtors sold 712 residential properties last month, according to the Ottawa Real Estate Board. That’s up 7.2 per cent from the 664 homes sold a year earlier and well above the five-year average of 638 units changing hands in January.

The average resale price of a residential-class property rose 8.8 per cent year-over-year to reach $427,487.

OREB president Rick Eisert said the unusually low number of new listings last month helped fuel the price increases for residential properties. Just 994 residential units and 406 condominium units came on the market in January, well below the five-year average of nearly 1,400 residential units and 500 condos.

The lower-than-usual number of new listings was a trend throughout 2017, Eisert said, and looks to be continuing into 2018.

“The result is our resale market is being challenged by decreasing supply in both the residential and condo markets,” he said in a statement. If the trend continues, he added, “it will tend to put upward pressure on prices. This is simple supply-and-demand economics.”

Condo prices, on the other hand, fell 8.6 per cent compared with a year earlier to an average of $263,744.

More than half of all condos sold were priced between $150,000 and $249,999, the board said, while nearly 50 per cent of all residential properties fell in the $300,000 to $449,999 range.

“There is a marked increase in the number of condo units sold in the lower end of the market specifically,” Eisert said. “This is likely due to the attractive lower price point and the fact that the demand is there.”