The scars of the pandemic have almost healed. Businesses have gotten up and started running after making mandatory adjustments to a new normal. And Ottawa’s real estate market has lighted up.
The uncertainty conjured up by the pandemic during the hot spring market that spilled into the summer months haven’t been successful in creating any major dent in Ottawa’s real estate business. A brief period of lull in sales during the nationwide lockdown was adequately compensated by a huge burst of demand for homes when the economy unlocked in phases.
According to the Ottawa Real Estate Board, sales during August rose by 17% to 2,017 properties compared to previous year. The average house price soared 22% year-over-year to $592,548 while condo prices climbed 24% to $383,640. The frenzy in people for new homes have skyrocketed in the past two months and real estate experts are optimistic that this purple patch will continue till the end of autumn.
Robust property sales in the offing
Ottawa as a city is different to the rest of Canada. Here most citizens hold government jobs that are stable and haven’t been affected by the pandemic. Compare this with the rest of the cities where unemployment has zoomed.
This stability in the job market is reason why people have utmost confidence in entering the property market and look for a home of their choice. Some homebuyers don’t mind going for higher bids when it comes to buying a larger house keeping in mind the health and hygiene factor.
And this has fueled a lot of construction activities in the city. Builders are working at searing pace to accommodate the pent-up demand that has erupted unexpectedly after the lockdown was lifted. Housing construction in Ottawa and Gatineau has jumped 154% year-over-year in August, the biggest jump among Canada’s cities. A total of 1,619 new homes are being built in Ottawa.
What caused the jump?
A lot of factors came together to create a huge rebound in home sales. Besides job stability of Ottawa residents, pent-up demand, improved consumer and builder confidence, low-interest rates and underlying strength of the market have placed Ottawa real estate picture in a dominant position. Affordable product launches captured almost 50% of the home sales owing to its appeal to first-time home buyers.
However, naysayers have warned that these favorable times may not last long as the Covid situation hasn’t passed off completely. The spike in real estate sales may thin out over the next few months as rising home prices may lead to first-time homebuyers falling over the home buying radar. Also, with drop-in immigration rates, condo sales have taken a hit. This uncertainty will rise up in the coming months unless real estate developers resort to price corrections to rein in home buyers and keep the ball rolling.