Home sales plummet in July, but prices keep rising: OREB

House for sale
House for sale

After setting a breakneck pace in the first half of 2021, resale housing activity in the capital slowed considerably in July as the number of transactions plummeted more than 20 per cent compared with a year earlier.

A total of 1,724 residential properties changed hands last month, according to the Ottawa Real Estate Board. That’s down 21 per cent from the 2,183 sales recorded in July 2020 and slightly below the five-year average of 1,775.

It’s a dramatic contrast to last summer, when resale transactions soared. But OREB president Deb Wright said thoses eye-popping sales figures were skewed as a result of widespread COVID-related shutdowns earlier in the year that put a damper on the industry.

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“July’s unit sales followed the traditional cycle of the spring and summer markets, which tend to peak around April or May and then slow down as buyers and sellers turn their attention to their vacations and other outdoor recreational activities,” Wright said in a statement.

“Certainly, the marked decrease from last year’s July sales is due to the spring 2020 lockdown, which had shifted the 2020 resale market’s peak to the summer and fall months.”

Meanwhile, home prices – which had been rising at a rate of more than 30 per cent year-over-year earlier in 2021 – showed more signs of levelling off, at least somewhat, in July.

The average sale price of a residential-class property was about $685,000 last month, up 17 per cent from a year ago. Condominium-class properties also saw prices rise 17 per cent to about $419,500.

While the city’s dwindling housing stock fuelled a spate of bidding wars last summer, Wright said inventory levels were up substantially in July compared with a year ago – 19 per cent for residential-class properties and 23 per cent for condos.

“Although there were 700 fewer listings than in June, the number of properties that entered the market in July is over the five-year average by approximately 114 units,” she said. “Along with the price stabilizations, we hope this may indicate that Ottawa’s resale market is moving towards a more balanced state, which would be good for everyone.”

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