Home Sales increased for the first time since February 2022
The latest update from the Ottawa Real Estate Board (OREB) reveals that their Multiple Listing Service® (MLS®) System facilitated the sale of 1,939 residential properties in May. This reflects a 6% increase from the previous year, where members sold 1,830 houses within the same month. The sales comprised 1,477 properties designated as freehold and showed an 8% increase from the previous year. Additionally, 462 units were listed under the condominium-property class, reflecting a modest 1% increase from May 2022.
The Ottawa Real Estate Board President, Ken Dekker stated that May’s transactions were exceptional, despite typically being the highest-selling month, with an average of 1,961 total unit sales over the past five years. It is worth noting the first year-over-year unit sales volume increase since February 2022. This bodes well for sellers, but any adjustments in interest rates could impact this trend. Although the number of listings is sparse with only five to six weeks of inventory, the market is still strong for sellers. However, demand continues to exceed supply, which will likely put upward pressure on prices.
By the Numbers – Average Prices*:
The average sale price for a freehold-class property in May was $745,902, a decrease of 7% from 2022, but still on par with April 2023 prices.
The average sale price for a condominium-class property was $442,859, decreasing 6% from a year ago. However, it marks a 2% increase over April 2023 prices.
With year-to-date average sale prices at $727,728 for freeholds and $428,394 for condos, these values represent a 12% decrease over 2022 for freehold-class properties and a 9% decrease for condominium-class properties.
As of May, while we haven’t observed significant price increases, average prices have remained constant compared to April. However, prices have surged in contrast to those recorded at the close of 2022. Given that demand is on the rise in an Ottawa market persistently under-supplied, I predict that the typical final sale price could once again surpass figures for the corresponding month of the prior year in the latter half of 2023. This is under the assumption that interest rate increments will not be implemented.
By the Numbers – Inventory & New Listings:
May’s new listings (2,822) were 9% lower than May 2022 (3,117) and up 32% from April 2023 (2,140). The 5-year average for new listings in May is 2,922.
Months of Inventory for the freehold-class properties has increased to 1.5 months from 1.2 months in May 2022 but down from 1.9 months in April 2023.
Months of Inventory for condominium-class properties has increased to 1.3 months from 1 month in May 2022, although down from 1.9 months in April 2023.
Days on market (DOM) for freeholds decreased from 27 to 23 days and 33 to 26 days for condos compared to last month.
“Given our housing stock challenges, some neighbourhoods are again in multiple offer territory. REALTORS® have up-to-the-minute market data and are best positioned to help both buyers and sellers in this evolving competitive resale market.”
REALTORS® also help with finding rentals and vetting potential tenants. Since the beginning of the year, OREB Members have assisted clients with renting 2,731 properties compared to 2,230 last year at this time, an increase of 22%.
OREB warns against using the average sale price as a gauge for determining the value fluctuation of specific properties, although it can be helpful in identifying overall trends. The average sale price is determined by the total dollar volume of all properties sold and could vary from one locality to the next.