Three Market Predictions for Ottawa Real Estate for next 3 to 8 months

The Real Estate Market is very volatile at the moment as any news update or government announcement about rates is having a direct impact to the market and the mindset of buyers and sellers. We wanted to provide 3 market predictions for the Ottawa Real Estate Market for next 3 to 8 months to help give you some insight from the perspective from a Ottawa Realtor, Investor and passionate real estate professional who watches the market everyday.

1. Increase in Inventory: We have had low inventory for about a few years now which is why our prices have gone so high over the past few years and also why with even such high interest rates we are still seeing the market moving forward and prices stabilizing, and low inventory was the main reason for this. We think that the inventory issue will be changing as we are seeing more inventory coming to the market now compared to what is being sold which means the remaining inventory is starting to grow and fast. A large part is because of the rates and economy as alot of people are about renew there mortgage for payments of 30% to 35% higher payments that there were used to so some are looking to liquidate the property and cash out. Alot of investors who have more then 1 property are starting to sell also as alot of rentals are not being able to cover the cost of the mortgage with the rental income unless you have a small mortgage so we are also seeing more of small landlord investor trying to liquidate properties. We are seeing so many Assignment deals available also which is when buyers of new built properties are trying to sell the deal to another buyer as they are not wanting to close or can't close the transaction because of financing issues. We were used to having around 2500 - 3000 active residential listings in a sellers market and and at moment we now have around 4600 and growing residential properties so we are getting to a balanced maket now and soon will be in a buyers market.

2.Prices to go down another 10 to 12%- The market last year went down in general around 15% all across the city as the Bank of Canada continued its rain of terror against inflation by consistent increases in interest rates. We then saw the market stabilize and hit a bottom as inventory was still low and the bank of Canada paused its increases as inflation tamed down. Those increases are really starting to be felt now though as people can’t wait any more for rates to come down and people need to renew their mortgage. The mindset all over is that we are in a recession and news all over is talking about negative economy and it has put buyers and sellers in a state of worry so we this is also why we are seeing such a Huge increase in inventory at moment. The more listings we have available that means more options for Buyers so that means sellers will need to be competitive to sell and that will drive prices down. We think that another 10% to 12% reduction in prices over the next year.

3.Government/ Lender Measures - The government is on the spotlight right now on housing and its a very hot topic as housing is huge part of the economy and the government needs to make sure that they implement new measures for Homeowners, to-Be Homeowners, renters and then if possible to investors. It seems that every few months the government and lenders are coming up with new ways to help builders build more rentals, change the rules for lending, increase rates and make changes to try to help the struggling housing market which needs a lot more homes and now. That is all great but most of the initiatives are just not good enough and don’t really help current home owners or soon to be home owners with the cost for lending which is the underlying problem at the moment as the price of homes and interest rates make it very hard to afford monthly for long term for most families. These rates made sense when prices of homes were not as high. We are also in a stagflation situation at moment which is when inflation is high but economic growth is slow and unemployment is increasing and any change to fix one of the issues will cause the other to change. I think the best thing they can do which will allow rates to increase but also allow current homeowners and to-be home owners to be able to afford the monthly payments is that all or most lenders increase amortization periods to 30 and 35 years. This would spread the monthly payment over a longer period and reduce the monthly cost quite alot which would make it for affordable for homeowners, investors and easier to qualify for a mortgage for to-be home buyers. This would allow for higher rates but also still make sense for monthly cashflow for everyone.

Whatever they introduce I hope that it comes soon, and that it will actually be helpfulWe hope that this info was helpful, and these are just my predictions and what I think might happen in the next 3 to 8 months for the Ottawa Real Estate Market. I am a full-time passionate realtor for almost 13 years, Real Estate Investor and small landlord and I watch and work in this market day in and day out so that I can provide input for my partners and clients.

Have any questions about my predictions and want to talk real estate? Give me a call at 613-262-9562 or [email protected]

www.soldbysorin.com

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