It's been quite a ride in this Ottawa real estate market. In 2000 the average home sold for $159,511 and in 2012 the average home sold for $351,792 . Certainly a much larger gain than the low inflation rate during this period. Even the Great Recession of 2008 could not cool the market. We have all been very happy with the increasing value of our homes. So what is different now? Why is everyone calling fowl and saying our market is in a bad way?
First of all, the market is not in a "bad way", it is changing and there are some very sound reasons for the changes.
Household debt from buying mortgages has ballooned to record levels above 160 per cent of disposable income and the powers that be are predicting that many families will be in over their heads if the interest rates increase to a more normal level - whatever normal is today.
There is definitley a change in the market. There is a greater supply of homes for sale which gives buyers more choice to buy only what they consider the "good deals" In Ottawa, many households have a high percentage of equity in their home and have the flexibility to take advantage of the changing market by moving , buying for the first time or buying an investment property.
Even the economists can't agree on what is going to happen going forward. We all know that if we had a crystal ball it would be much easier to predict the future. What we do know, is that it is going to take longer to sell most homes and there is going to be a downward pressure on prices because of supply and demand.
This doesn't mean that homes are not being sold or that new homes are not being built - just take a look around and see how many apartments are going up or how many houses have sold signs on them. It just means that the market is changing and if you plan to move or buy your first home you need good sound advice from someone who understands the market and can make it work for you.