Buy your house or sell your house in 2013 — you won’t lose your shirt but don’t count on making a fortune, either.
After seeing a more active market last spring, stricter mortgage rules introduced by the government last summer have succeeded in slowing things down.
“We’re seeing the effect of the government’s effort last July to kind of temper the mortgage market availability and to cool things down,” said Ottawa Real Estate Board president Tim Lee. “To that extent they’ve been successful.”
The stricter rules are at least partly responsible for the dip seen in January 2013 over January of last year, when residential home sales dropped by 11.7%. The average price of new homes also saw a slight decrease of 1.8% in the same period.
Unlike the wild swings seen in big cities like Toronto and Vancouver, the Ottawa market is more in line with how many outsiders view Ottawa in general — consistent, if not somewhat dull, a city that doesn’t rock the boat too much.
“Realtors from Toronto or Vancouver look at us like we’ve got two heads,” said realtor Chris Hollands, a 25-year veteran of Ottawa real estate. “(They say) ‘why would anybody want to buy in Ottawa, it’s boring, (the market) goes up 4-5% every year.
“But then we don’t have any decreases either, it just kind of plods along in very typical Ottawa fashion.”
Bottom line, Ottawa is seeing neither a seller’s market nor a buyer’s market at the moment. Instead, the climate in the city is what experts call a “balanced market.”
“You’re not getting that sort of stereotype where people put their house up for sale and there’s like five offers,” Hollands said.
Lee agreed, adding there haven’t been major market fluctuations despite significant government job cuts.
“The good thing about Ottawa is we’re a nice stable market,” he said. “We’ve managed to weather (the job cuts) very, very well and we continue to see large population growth in Ottawa.”
While there may not be many bidding wars going on as Ottawa slugs through a snowy winter, those in the business expect things to heat up when they usually do, as the snow melts and we move into spring.
“Ottawa is very traditional that way,” said Hollands of the seasonal activity patterns in the market.
Following a slow winter, said Hollands, “there’s all sorts of pent up demand and things tend to explode.”
“We may be on the cusp of that,” he said. “Not an explosion, but certainly an accelerated market.”
Condos remain a hot commodity for buyers, especially downtown, said Lee, with prices rising about 6% year-over-year. Single detached homes prices, on the other hand, are down about 1.7%.
“It falls in line with a lot of developers investing their money in condo developments,” Lee said.
Lee said it’s hard to gauge how the market will fluctuate in the spring.
“There’s always a flurry of activity in March and April. A large part of yearly activity takes place in those two months. It’s just too early to predict.”