The Ottawa Real Estate Market in Context
Fall has arrived, and the Ottawa real estate market continues to shift. Let's take a look at some core indicators, within the context of wider market trends, for September.
Number of Home Sales (Year-Over-Year)
* Residential sales include all residential properties; freehold includes detached singles, townhouses, and semi-detached homes; and condos include apartments, row units, and stacked-style dwellings.
Home sales last month remained significantly lower than September of last year, as demand continued to fall. Interest rates remain a central factor in sales velocity here in Ottawa. For context, the Bank of Canada's first interest rate hike occurred in March of this year. A schedule of the overnight rate increases affected by the Bank of Canada can be found here. The graph below shows monthly sold unit data over the last four years which is useful in providing more holistic context to our current economic climate.
Overall Prices (Year-Over-Year)
* Residential sales include all residential properties; freehold includes detached singles, townhouses, and semi-detached homes; and condos include apartments, row units, and stacked-style dwellings.
Prices in September remained higher than this time last year, though only by a thin margin.
Month-over-month, residential sales rallied compared to August, though only by a small 1.4% margin. The table below shows month-over-month data for 2022 to-date. The graph below shows monthly average sale price data since the beginning of 2019.
Month (2022) | Price | % Change |
January | $680,276 | 10.92% |
February | $750,496 | 10.32% |
March | $758,969 | 1.13% |
April | $739,583 | -2.55% |
May | $718,998 | -2.78% |
June | $686,752 | -4.48% |
July | $649,602 | -5.41% |
August | $635,982 | -2.10% |
September | $644,905 | 1.40% |
Days on Market (Month-Over-Month)
The term "days on market" refers to the number of days that a home is listed for sale before it is purchased.
Last month, a home took 29 days to sell, on average. This September figure represents an increase from September 2021, when homes sold in 20 days.
Months of Inventory
The months of inventory measure ("MOI") is a core indicator of whether we are in a buyer’s, seller’s, or balanced market. In general, it describes how many buyers exist for the current number of listings. MOI is calculated by taking the amount of homes available for sale and assessing how long it would take for those to sell if demand remained constant and no new inventory was added to the market. A balanced market has between 4 to 6 months of inventory, a seller’s market has less than 4 months of inventory, and a buyer's market has greater than 6 months of inventory.
In September 2022, residential-class properties increased to 3.1 months from 1.2 months in 2021. Condominium-class properties increased to 2.7 months from 1.6 months in 2021. This still places us in a seller's market for the time being.
Historical Average Home Prices in Ottawa (1956-2021)
A review of historical sales data for the last 60+ years helps illuminate the present situation in Ottawa's housing market. Cumulative record-setting years of appreciation have resulted in a rapid escalation in house prices, so the current correction is not unexpected, independent of interest rate increases.
What This Means for You
It is critical to note that broad aggregate data is useful to establish trends, but significant variability exists at a community and housing-type level. If you are interested in getting a more refined estimate of the value of your home, or if you are interested in beginning your house hunt, please feel free to get in touch.
* Real estate market data is taken from the Ottawa Real Estate Board's Multiple Listing Service (MLS) and is believed to be accurate but is not warranted.
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