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More Housing Please! – Very low inventory in Ottawa Housing Market

 

Months of Inventory is used to measure how many homes are available for buyers to view and buy.

This chart of the last ten years shows that 2013-2016 were quite similar, with the seasonal variations of homes for sale.

But from 2017, Ottawa had a steady decline in availability.  That was of course further affected during the period of covid, where working and schooling from home convinced many people to move into larger dwellings. And the extremely low interest rates allowed people more flexibility. This caused a major shortage of available properties – homes were selling almost as fast as they were listed.

Late spring of last year saw a big change as the Bank of Canada started increasing the prime lending rate precipitously. And because the mortgage companies base their mortgage rates on that rate, mortgage interest rates went up. This forced many to review how much home they could afford. And also worried many buyers – how much more would the central bank hike rates?

Now that the BoC has held the rate steady for the past couple of months, people are again buying homes faster than they are coming onto the market.

This is good for sellers of course, but difficult for people who have to move. And how much more difficult will it become with the plans by the federal government to have at least 500,000 immigrants per year?

Plus the usual alternative of renting instead of buying is also being squeezed by low inventory.

 

Apparently CMHC is predicting lower prices and lower inventory through the end of 2023. The article “CMHC Predicts Continued Decline In Canadian Housing Market” discusses their forecast. And, interestingly, the comments at the end by realtors do not completely agree with this prediction. (Surprise!) ( And their prediction at the start of COVID turned out to be the complete opposite of reality)

 

 

Check out more articles in the with similar categories – Board Sales, Ottawa Real Estate Market, Properties-Ottawa