Ottawa home prices will rise at a rate slightly higher than the national average in 2013 despite a slowdown in the first part of the year, according to new projections released Tuesday.
Real estate firm Royal Lepage predicts prices will rise by 1.3 per cent, which is just above the expected national average of one per cent. The average Ottawa house will cost $357,000, the firm predicts, up from $352,500 in 2012.
The total number of homes sold, meanwhile, is expected to fall by 2.1 per cent to 14,250.
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Across the country, the quarterly market update by the Toronto-based real estate firm forecasts a brief, mild dip in sales volume in the first half of this year but not a major downturn as some owners opt to delay selling their property until conditions improve.
“Our sturdy domestic economy and encouraging employment trends have emboldened sellers, and some have opted to let market conditions adjust before listing,” said Phil Soper, Royal LePage’s president and chief executive.
“Simply put, fewer home owners listed their properties in the second half of the year, which kept inventory levels lower, and supported home values.”
The firm notes that there are a wide range of conditions in cities across Canada.
It says slower sales and a flattening of home prices in Vancouver and Toronto – Canada’s two largest and most-expensive real-estate markets – will have a significant impact and drag down the national averages this year.
It says some markets, particularly in Alberta and Saskatchewan where the resource-oriented economies have been vibrant, are poised for significant growth in 2013.
The Royal LePage quarterly House Price Survey looks at three categories of housing – detached bungalows, standard two-storey and standard condominiums – in 16 local markets and calculates national averages.
The latest survey, based on sales between October and December, showed that national average price for detached bungalows was $356,790 – up 3.6 per cent from a year earlier but down from the third-quarter average of $377.773.
A similar pattern of year-over-year increases but quarter-to-quarter declines were evident in the other national average categories.
Many observers have noted that tighter mortgage rules brought in last July have made it more difficult for first-time buyers to borrow money, since they must qualify for a 25-year payback period. That’s down from 30 years.
The national average price for two-storey houses was $390,444 in the fourth quarter, up four per cent from a year earlier but down from $403,747 in the third quarter.
The national average price for condos was $239,374, up two per cent from a year earlier but down from $243,607 in the third quarter.
-With a report by The Canadian Press
