April’s Resale Market Starts Strong and Sputters
Published: Thursday, June 3, 2021
OTTAWA, May 5, 2021 - Members of
the Ottawa Real Estate Board sold 2,402
residential properties in April through
the Board’s Multiple Listing Service®
System, compared with 911 in April 2020,
an increase of 164 per cent. April’s sales
included 1,859 in the residential-property
class, up 166 per cent from a year ago,
and 543 in the condominium-property
category, an increase of 155 per cent from
April 2020. The five-year average for total
unit sales in April is 1,830.
“As the typical spring market ramped
up, April was poised to be the strongest
on record with over 3,200 new listings
of properties for sale. Most of these
properties entered the market before the
province’s stricter lockdown order was
announced midway through the month.
At that point, the trajectory sputtered, and
while it continued to be active, it followed a
noticeable decline as Sellers responded to
the government’s resolution to reduce the
spread of Covid-19,” states Ottawa Real
Estate Board President Debra Wright.
“Nevertheless, the number of transactions
managed to surpass unit sales recorded
in previous Aprils, and we presume the
figures would have been even higher in
different circumstances,” she adds.
“As I had cautioned last month, the
percentage increases over 2020 figures
are vastly skewed due to the first State of
Emergency last spring, which had initially
slowed down the real estate market. Thus,
the 155 to 166 percent increases in unit
sales are simply not valid results. We
recorded 2,026 sales in April 2019 and
2,024 in April 2018. These figures provide
a more reasonable comparison, which is a
19% increase in overall sales compared to
those pre-pandemic years.”
April’s average sale price for a
condominium-class property was
$427,145, an increase of 30 per cent from
last year, while the average sale price for
a residential-class property was $743,204,
an increase of 42 per cent from a year ago.
With year-to-date average sale prices at
$734,682 for residential and $418,792 for
condominiums, these values represent a
35 per cent and 20 percent increase over
2020, respectively.*
“These accelerated price increases
boil down to a lack of supply and will
continue to be a challenge for Buyers
until more inventory becomes available
– it’s fundamental supply and demand
economics. Certainly, April’s substantial
increase in new listings, 19% higher than
the five-year listing average and over 400
units more than the previous month, gives
us cautious optimism. When the Stay-atHome order concludes, we hope that pent-up supply will bring some much-needed
housing stock to the resale market,”
suggests Wright.
“However, there are many factors at play
which make it difficult to forecast the path
of Ottawa’s real estate market: interest
rate modifications, the skyrocketing cost
of building materials, the Office of the
Superintendent of Financial Institutions
(OSFI) proposal to increase the
mortgage stress test, changing consumer
perspectives with some Buyers opting
to move to outlying communities and
Quebec, etc.”
“On the one hand, record low interest
rates, increased household savings, a
strengthening economy, and a continued
focus on living space during the pandemic
are all factors that bolster demand, while
steady price growth is encouraging more
Sellers to list their home. On the other
hand, some people are truly struggling
and small businesses are closing their
doors. It’s complicated, it’s out of balance,
and the course of our local market is not
entirely predictable at this time,” Wright
concludes.
OREB Members also assisted clients
with renting 1,458 properties since the
beginning of the year compared to 947 at
this time last year.
* The Board cautions that the average sale
price can be useful in establishing trends
over time but should not be used as an
indicator that specific properties have
increased or decreased in value. The
calculation of the average sale price
is based on the total dollar volume
of all properties sold. Price and
conditions will vary from neighbourhood to
neighbourhood.