No relief in sight for homebuyers facing supply crunch: OREB

Home sold sign

Home prices continued to rise last month despite a steep drop in the number of sales compared with a year earlier as the market remains in the grip of an ongoing supply crunch, the Ottawa Real Estate Board said Tuesday.

The average residential-class property in the capital sold for $702,000 in September, up 13 per cent from a year earlier, the latest figures from OREB show. The average condo price jumped 14 per cent to about $425,000. 

Meanwhile, the volume of sales compared with 2020 fell in September for the third consecutive month.

Local realtors brokered a total of 1,607 residential transactions last month, a decline of more than 30 per cent from the 2,314 homes that changed hands a year earlier and slightly below the five-year average of 1,648.

But OREB president Deb Wright cautioned against reading too much into year-over-year comparisons. Noting that September’s transaction totals were actually higher than those from 2018 and 2019, she said last year’s numbers were skewed because COVID-related business shutdowns in the spring shifted peak sales activity to the summer and fall.

'Unrelenting demand'

The average price of a residential-class property is up 25 per cent over the first nine months of the year compared to 2020, while the average condo price has increased 17 per cent over last year, Wright said.

The veteran realtor said price hikes are “inevitable” given “unrelenting high demand” for housing coupled with a continued lack of supply.

Wright said Ottawa has only about a month’s worth of inventory, making chronic supply shortages the industry’s “principal cause for concern” as many would-be buyers continue to be priced out of the market.

There were 2,252 new listings in Ottawa last month, down from 2,906 a year earlier, OREB said. 

“With the (federal) election behind us, we hope the government will now concentrate on addressing supply issues and developing first-time homebuyer assistance touted in their re-election platform,” Wright said in a statement.