Ottawa Real Estate January 2013


The 2012 Ottawa Real Estate Market in review

2012 was an interesting year for Ottawa real estate. For the first three months of the year, it was business as usual – lots of activity with homes selling relatively quickly. Then the Federal Government announced the long awaited employee cut backs and a month after that, a change in mortgage lending rules was introduced and shortly thereafter implemented. The market continued at a steady, but somewhat conservative pace until mid summer when it began to show signs of a slowdown.  A summer slowdown is not uncommon, when the spring market ends and most families have already facilitated transactions and timed their closing for the summer months. Sales still occurred over the summer, but by late August there was noticeably less activity. This was still not enough of an indicator to say the market had changed however because, in past years, when there was the recession and when HST came into effect, the market bounced back in the fall.

September came and the industry noted a continued slowdown in showing activity on properties and a change in buyer behavior. Buyers were taking their time with buying decisions and even waiting for other properties to come on the market, knowing that fear of price increase was probably no longer a factor. Buyers were still buying, but it was evident that many were proceeding more cautiously and not prepared to pay the ‘future value prices’ that some sellers were still expecting. A stalemate was created in many negotiations and as time passed, it was the buyers who had a slight upper hand; something not seen in many years.

November is generally viewed as the last full month of the fall buying season. If your property does no’t sell in November or the first two weeks of December, there is a likelihood your property could remain on the market for the upcoming winter months. The snow held off until mid December, as sales continued to the end of the fall buying season. This was viewed as a positive indicator that the New Year would start off well with positive buyer’s confidence.

What’s ahead in 2013?

So here we are, it’s 2013 and what does the future of the Ottawa real estate market look like? 2013 will start the year off as it started in September, yes September, with sellers expecting future speculative values and buyers conservative in their offerings. Why will it start off this way? Because sellers believe 2013 is a new market and buyers thinking it remains the same – the buyers are right!

If the supply (number of properties on the market) is absorbed quickly in the New Year, or there is a less than normal flow of future sellers putting their properties on the market, then there’s a chance for an increase in home pricing by spring as demand will outweigh supply. My opinion, this is not likely to happen as I believe there will be more supply in the first three months of the year than we have seen in some time. Supply will be up because there is current inventory on the market; there will be new inventory; and there will be an inventory of properties that were taken off the market in 2012. Some sellers believed they should take their properties off the market in the summer/fall of 2012 and wait in anticipation of a more active spring market with traditional price increases. This is the same belief many sellers had in 1994 when the Federal Government first introduced layoffs. Unfortunately, these sellers, then and now, received poor advice from some Realtors who believed it was easier to take the property off the market than re-evaluate the seller’s current marketing strategy and make adjustments to current market conditions.

I would like to point out again that I am not predicting the market will change from a ‘balanced market’ to a ‘buyer’s market’ as buying confidence is still strong and will continue to be for some time to come. Buyers will, however, have more choice in properties and because of this Buyers will most likely be in a stronger negotiating position. This last point also needs to be clarified. It does not mean Buyers will be able to negotiate tens of thousands of dollars off the asking price of properties. It means that in a situation where the seller needs to sell, there is a higher likelihood that negotiations will be in the Buyer’s favour with more concessions made by sellers. If a seller doesn’t need to sell or if their property is newly on the market, expecting negotiations in the Buyers favour is also less-likely.

So if you were thinking of buying, with record low interest rates perhaps right now is the best time to do so. If you are thinking of selling, now more than ever would be the right time to talk with me about creating a strategy to sell your home.

 Respectfully,

 

 

Peter Sardelis
Broker
Century 21 Capital Realty Inc.
(613) 564-0021

There are no comments

Thank you! Your comment has been submitted and is awaiting approval.

Peter Sardelis

Peter Sardelis

Broker
CENTURY 21 Capital Realty Inc., Brokerage*
Contact Me

Tags