Home sales in Ottawa fell for a fourth straight month in June as higher interest rates and inflation continued to weigh on the real estate market.
The number of home sales in June was down 29 percent year-over-year, according to the Ottawa Board of Real Estate. This includes a 31% decline in home sales and a 23% decline in condo sales.
“After the craziness of the past two years, we are seeing the Ottawa resale market normalize in 2022 and move to a more traditional seasonal ebb and flow cycle,” OREB president Penny Torontoau said in a news release.
“While June transactions typically slow down as many look to their summer vacations, last month’s sales were at a slower pace than we’ve seen in more than a decade.”
Torontoau attributes the decline to rising interest rates and inflation, which are affecting the cost of living. She also suggested other factors such as shopper fatigue, a lack of confidence among consumers and uncertainty around back-to-work arrangements.
“A long commute with soaring gas prices will certainly affect decisions about where to live,” she said.
Despite the decline in the number of sales, home prices in Ottawa are still rising. The median home price in June was $772,861, a six percent increase from a year ago. The median price of a condominium was $438,977, an increase of one percent.
Torontoau said that even as the numbers fluctuate, real estate in Ottawa will continue to be stable over the long term compared to other cities. Toronto, for example, saw home prices drop more than 40 percent last month.
“We are unlikely ever to experience the significant declines that other regions may see,” she said. “Prices will not fall; they tend to level off to the reasonable levels of growth we’ve had in the past.”
Housing market inventory is also slowly moving toward a more balanced market.
Housing inventory is up 38 percent from this time last year and is at a nearly two-month high.
A few months ago, the housing supply in Ottawa was about two weeks worth.
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