Ottawa’s red-hot residential real estate market saw no slowdown in momentum as 2020 drew to a close.
Home sales surged more than 30 per cent in December compared with a year earlier, the Ottawa Real Estate Board said Wednesday, with the new head of the organization urging buyers to brace themselves for more price increases in 2021.
Members of the Ottawa Real Estate Board sold 1,002 properties last month, up from 757 in December 2019 and well ahead of the five-year average of 779. Local realtors sold 710 residential-class properties and 292 condos last month, with both segments posting year-over-year increases in the 30 per cent range.
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Overall, nearly 19,000 homes changed hands in 2020, a slight increase over 2019’s total of about 18,600. But prices rose at a much faster rate over the last 12 months as buyers snapped up new inventory almost as fast as it was put on the market.
The average price of a residential-class property in Ottawa was $582,267 at the end of December, a 20 per cent jump from 2019. Meanwhile, the average condo sold for $361,337, up 19 per cent over a year earlier.
Record-breaking sales volume
By contrast, overall housing prices rose at a much lower nine per cent in 2019. The city’s total sales volume topped a record-breaking $10 billion in 2020, compared with $8.2 billion at the end of the previous year.
“This is, in effect, a stark illustration of the increase in Ottawa property values over the course of the year,” new OREB president Debra Wright, a broker at Stittsville’s Details Realty, said in a statement.
While more than a third of all properties in Ottawa changed hands for $400,000 or less in 2019, that share fell to 16 per cent last year.
“The market is certainly exhibiting a major shift in terms of availability in lower price ranges,” Wright said.
The veteran real estate agent cited a number of factors for the rapid escalation in prices, including a shortage of inventory that triggered bidding wars, record-low mortgage rates and a “migration of buyers from larger markets with high returns to spend.”
Wright said she doesn’t expect the region’s housing market to cool off any time soon.
“I believe that Ottawa is just coming into its own as a national capital city,” she said.
“As such, it is resilient and sheltered in a way that other markets are not – with consistent government and tech sector employment that is particularly conducive to working from home as our current circumstances have required. Going forward, I fully expect Ottawa’s resale market will continue to be robust in 2021.”
OREB’s forecast is in line with many major brokerages that are predicting another banner year for local Realtors.
Last month, Royal LePage said it’s forecasting the aggregate price of a home in the capital to rise 11.5 per cent in 2021, well ahead of the overall average increase of 5.5 per cent across all major Canadian markets. The brokerage said the spike is being fuelled by the region’s stable government- and tech-driven economy, an influx of buyers from the Toronto area looking for better value and surging demand for roomier properties in the COVID-19 era.