Canadian Housing Market Outlook Report 2021 and the Ottawa Real Estate Market
The recent RE/MAX fall 2021 Canadian housing report showed a strong housing market across the country. Let’s dig into some of the specifics and take a closer look at the Ottawa real estate market. The RE/MAX report came out October and as we shoot this in November 2021, the trends remain consistent in the Ottawa market. Let’s take a look at the Canadian Housing Market Outlook Report 2021.
Buyers and Prices
Detached, single-family home demand is primarily driven by young families. Demand has been consistently higher than supply, resulting in increased housing prices across the country.
Low interest rates, a greater level of saving, and increased housing budgets continue to fuel demand. The flexibility of working from home has given some buyers the option to choose markets where prices are not as high.
The Ottawa real estate market mirrors the national trend, with prices for a single, detached home increasing 26% from 2020. RE/MAX expects that trend to continue, with an additional 4% price increase in Ottawa homes of all kinds in the remaining months of 2021.
Families moving to Ottawa face a challenging market, with high demand, high prices, and low supply. Ottawa real estate agents report that despite a brisk market, it can be difficult for young families to find a suitable home within their budget.
Homeowners living in Ottawa are also affected by high demand and low supply. Those looking to buy a larger home or downsize to a smaller home are finding their options limited.
When those homeowners are unable to move, the Ottawa real estate market faces a bottleneck. While the market is brisk and solid, it would be further bolstered by increased supply.
Large cities including Vancouver and Toronto saw some of the largest home price increases in 2021. Remote work has given home buyers the ability to seek more affordable homes outside these metro areas.
Western Canada has seen buyers taking advantage of lower prices in areas such as Edmonton and Calgary. These areas have experienced single-digit price increases for single detached homes compared to the 20% and greater increases seen in other areas.
Atlantic Canada saw the widest range of single detached home price increases. From an 8.4% increase in St. Johns, NFLD to a 24.3% increase in Halifax. Sales in the area are up 60.4% over 2020.
How Many Homes Are Selling?
There were fewer homes sold in Ottawa in October of 2021 than in October of 2020. Residential property sales were down 24%. This is an artificial drop, the result of initial COVID lockdowns pushing the 2020 sales peak from spring to fall.
Ottawa real estate in 2021 followed the same patterns seen in the fall of pre-pandemic years. Ottawa realtors saw a busy, active month with 1,263 residential properties sold. The total number of homes of all types sold was greater in October than September and greater than the five-year average for the area.
Good News
A solid, stable housing market is seen as a promising sign for continued economic recovery. That the industry continues to perform well through the pandemic is a good indication of market resiliency.
There are also indications that price increases are leveling off in larger cities. This is especially good news for first-time buyers struggling to find affordable options.
The Bottom Line
The Ottawa real estate market remained robust through the fall of 2021. The artificially inflated number of units sold in the fall of 2020 creates a deceptive year-over-year drop in the number of homes sold.
In reality, the fall of 2021 saw the same patterns and fluctuations as pre-pandemic years. The largest challenge in the current housing market is increased prices due to high demand and low supply.
Ottawa real estate agents face a competitive market. The exchange of properties needs to increase for young families to enter the market. Realtors report that Ottawa’s housing stock needs to increase dramatically to provide enough opportunity for first-time homebuyers.
Across the country, a similar pattern is occurring. High prices are driving prospective home buyers to areas with greater affordability, like Edmonton and Calgary. Toronto and Vancouver remain extremely challenging markets for homebuyers.
The RE/MAX fall report showed a very solid, growing housing market across Canada. But it also showed one with significant challenges for realtors and homebuyers. In nearly every area of the country, including Ottawa, insufficient supply is creating price increases that are leaving first-time homebuyers without affordable options.
Ottawa realtors also report an increase in rental properties. These homes are not entering the market for buyers, marking yet another pressure point on supply.
Despite the challenges of the pandemic, rising prices, and insufficient supply, the Ottawa real estate market remains solid and thriving. Addressing the supply issues would create even more opportunities for Canadians living in Ottawa or moving to Ottawa to become homeowners.
Ottawa realtors continue to successfully navigate this challenging market. Units sold in October are on par with pre-pandemic trends. The market outlook for the rest of 2021 remains strong in Ottawa and throughout Canada.
RECOMMENDED VIDEOS:
City of Ottawa The New Official Plan for Living in Ottawa Canada
