Oasis Realty Brokerage, Ottawa Real Estate
Gord McCormick Ottawa, ON K2S0H6
Phone: 613-435-4692 Mobile: 613-371-9691
 

Does record sales in May 2017 mean a seller's market in Ottawa?


Ottawa real estate had record unit sales in May and the combination of all indicators suggests we are either in a seller’s market or very much on the verge of one.

Sales and prices were up and new listings and overall listing inventory were down thus making for a good month for sellers and listing agents but not so much fun for buyers.

May is typically our busiest sales month (followed by June and then April) as our market is boosted by families looking to move before school starts in September and also a strong transition of government staff (primarily military and RCMP) moving to and from our area.

Unit sales strong:

Residential unit sales up 12.4% for the month, condos up 44.6%

The number of residential units sold in May was 1856 vs 1612 a year ago.

Condo unit sales were 444 vs 307 in May 2016

On a year to date basis through May, residential sales are up 12.4% and condo sales up 27.1%.

Average prices increases best in many years!

The average price of a residential property sold in May was $436,625 and increase of 7.4%. 

The average condo sold for $270,993 in May an increase of 2.3%.

Year to date increases for residential properties sold is trending up 6.7% and for condos 4.9%.  This is our best average price growth in 5 or 6 years.

Listing inventory continues to be the key indicator to watch!

New listings continued to slow with condo listings lower than May 2016 by 6.3% and the # of new condo listings down by 13.2%.

Overall, the number of new listings is 10% lower this year to date.

End May listing inventory suggests more even more buyer competition in coming months!

The combination of strong unit sales increases and a lower number of new listings leaves us at the end of May with 25.3% fewer available listings in the residential market and 22% fewer condos that in 2016.

This means more competition for available listings in general and thus favours sellers.  On an area by area basis this may vary but it does jibe with what we are seeing daily in the market.

New listings to sales ratio clear indicator of seller’s market conditions during May:

The number of residential sales (1,856) to new listings (2607) yields a ratio of 70.2% and this is almost Toronto high! (a ratio above 60% is said to reflect seller’s market conditions, with 40-60% representing a balanced market and less than 40% a buyer’s market.)  On a year to date basis the ratio is 58.8%, just short of a seller’s market

Condo unit sales for May (444) vs new listings (734) yield a ratio of 60.4%, also just in to seller’s market territory. On a year to date basis the condo ratio is 46.8% which suggests a more balanced market.

We are certainly seeing more multiple offers and offers days being established by sellers and their listing agents, especially in key geographic areas and price points.  Sellers should discuss their pricing and marketing strategy with their listing salesperson to determine the best course of action for their circumstances. 

Buyers want to be on top of new listings (and price changes) and not wait for an Open House to go and see a property that may interest them. 

Both sellers and buyers will also want to determine their own position on how they wish to participate in a multiple offer situation, should one materialize.

Why pay 5% commission to sell in a “hot” market?

Buyers and sellers need their salesperson or brokers’ advice just as much in a hot market as in a slower one….but do you really need to pay 5% commission on the selling side?

If you don’t think so, give us a call and we can explain our options that will *save you 26% to 50% of the selling fees on your sale.  613-435-4692

*not intended to solicit those with existing listings.  Savings based on our range of listing commissions vs more typical 5% fees.

 

Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
613-435-4692    oasisrealty@rogers.com
Oasisrealtyottawa.com 

An experienced, effective and inexpensive residential brokerage


Listing inventory critical indicator to watch in 2016 Ottawa real estate


 

We have had some positive signs in the local real estate market over the last few months and most industry watchers and participants would expect it to be a good year in our marketplace.  There are a still a couple of potential “potholes” though and sellers will want to keep a close eye on what is happening day in and day out.

Overall # Active Listings in 2016 vs 2011:
We think the most critical issue is listing both in aggregate and by price range.  While total listing inventory has decreased slightly in recent months, we are still carrying a very high number of listings compared to only a few years ago.  For example, a quick statistic from our Realtor system shows that total active listings at the end of January and February 2016 were 75.1 and 56.1% higher than only 5 years ago in 2011.  Unit reported sales have not increased significantly to cover this excess inventory.

Listings by price range/level:
A dominant result of sales in 2015 showed a marked increase in housing priced $300-$400K and $200K-$300K and if results continue to skew in this fashion, does this mean we may have a shortage of listings in these price categories?  Does it mean higher priced properties will suffer?

Supply and Demand can differ by neighbourhood and housing type also:
Real estate is local and of course supply and demand may be different in different locations across the area.

How long will it take my house to sell?
Probably the question not asked (or answered) enough by sellers of their Realtors.  Facts are as follows: for the year ended Dec 2015 the average residential property sold in a cumulative 83 days on the market and the average condo took 103 days.  So if you need to have your house sold in 30 days or less, this needs to be a big part of the conversation and marketing and pricing plan for your property/listing.

Market is dynamic and moves fast at this busiest time of the year:Things move very quickly over the next 10-12 weeks and sellers (and buyers) will want to make sure they are connected with a Realtor who can help them stay abreast of market dynamics and all the competitive pressures (ie don’t forget new home construction in the area!) that might get in the way of obtaining a successful sale.

If you don’t already have a Realtor you are working with, please give us a call and we will put our research and marketing programs to work to get your listing sold and to help meet your overall housing objective….and by the way, most sellers save 20-40% in real estate commissions and HST by working with us vs the typical 5% fees of most franchise or corporate Realtors.

Also FYI.  Our facebook page was recently ranked as the #1 Realtor and Brokerage facebook page in Ottawa and #11 in the country. https://www.facebook.com/oasisrealtyottawa/ by an online marketing analysis tool. (March 26th 2016 Likealyzer.com)

Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
613-435-4692
oasisrealty@rogers.com
www.oasisrealtyottawa.com

@OasisrealtyOTT


Great news: MLTT not expanding beyond Toronto!


In a somewhat surprising about face, the Ontario Provincial government announced yesterday that it would not be expanding the municipal land transfer tax (MLTT) accross the province.  This is great news for buyers/sellers and Realtors, as it looked like this was almost a fait accompli.

We believe that the issue was contentious enough and feedback significant enough that Queen's Park chose to back off.  So kudos to the government from this corner and all our friends and colleagues who helped lobby against this punitive taxation measure!

Here is a link to the National Post coverage of the story:  http://news.nationalpost.com/news/canada/ontario-wont-expand-the-municipal-land-transfer-tax-beyond-torontos-borders

 


how might election results impact Ottawa real estate?


As we reach the halfway mark in a hotly contested (and for us, lengthy) Federal campaign, we were wondering what the election outcome might mean for our local real estate market.  Though few can have an accurate crystal ball on this issue, we did a little history checking and offer some thoughts on the matter:

Price growth history:
The good….
2004-2011 was a period where we had minority Federal governments in power and this was a pretty good time for Ottawa real estate.  Average prices during this period rose some 45.8% to $343,701.

Ottawa also fared pretty well under a Liberal majority government between 1999 and 2004 where average prices rose from $149,650 to $235,678 a whopping 57.5% increase.

….and not so good:
Ottawa had not fared so well under Liberal majority governments from 1993-1999 when the Chretien Liberals decimated spending and public service headcount to balance the Federal budget.  Average prices in this 6 year period rose a total of just 1% from $148,129 to $149,650.

In the first years of the Chretien majority government housing transactions in Ottawa dropped by almost 30%, reflecting the drastic change in the local economy when the government was slashing budgets and personnel to react to a large deficit and a recession.

Current Market:
The current Conservative government elected with a majority in 2011 have curtailed government spending and headcount growth here in Ottawa to balance the budget and as a result our market has slumped somewhat during this time.  In fact, 2011 was our last solid year of average selling price growth which saw prices increase by 5.2%.  From 2011 to present, we have seen average price growth of only 8.6% total over the 3 and a half year period.

Bottom line:
A government that is not focused on balancing the budget or believes in “tax and spend” for new programs, is best for our local real estate market, as bigger government and more spending is generally good news for the Ottawa area economy.

Though we have fared well under both majority and minority governments, it is our view that a minority government is probably the safest, as there is less chance for drastic change in government management that could be made by a majority government and spending and head count are unlikely to be severely threatened.

You guess is as good as ours about what it going to happen in mid-October but at this stage it appears the many possible outcomes are unlikely to hurt our local real estate market and in fact, it is most likely we will see more spending rather than less.


Is fall a good time to buy or sell in Ottawa?


Our peak real estate season is fading with the last weeks of summer but what is the outlook for those looking to buy or sell in the fall market?

Business steady if unspectacular in Sept and Oct:
As one can see from the table below, September and October continue to provide reasonable sales activity, although unit sales are off 30-40% compared to the peak sales months of April through July.

Short “runway” for fall sales:
Sellers should be aware of sales activity levels and competition for their listing, as the steady fall sales level diminishes considerably after the end of October and we hit the winter doldrum months (Nov-Feb) which is our weakest period for real estate in Ottawa. Sales drop off another 20-40% during the winter months.
Sellers will also want to consider the average days-on-market (time to sell) in planning their listing and sale.  Current average year-to-date is 47 days for residential properties and 59 days for condos.

Listing inventory continues at elevated levels:
Lots of inventory out there overall and generally the market is overbalanced in the higher price ranges ($500K+) 81% of all residential sales this year have sold at $500,000 or less and 95.7% below $750,000. Competitive listings and other market factors are critical areas for a seller to review regularly with their Realtor. 

Tough seller questions:
do I drop my price? do I do some reno's on my existing property to enhance marketability? do I pull my listing off the market and bring it out at a later date? do I try another form of marketing altogether?  What are my overall objectives and how best can I optimize or mitigate these objectives, given the current market situation? Will the market be better or worse down-the-road? What is the opportunity cost of not selling now?

How are buyer prospects this fall?
Buyers who do not have a property to sell are certainly in a good position this year, given the excess listing inventory, as some sellers may have to adjust their price expectations to get a deal done in view of both resale and builder competition.  While new listing activity diminishes along with sales activity, there is a very good chance that some price action might occur on a currently listed property that will make it a more reasonable prospect for a buyer.  Buyers will want to watch pricing closely and be sure to have an auto notification set up with their Realtor to ensure they see list price changes the same day as the Realtors and before they hit the public MLS® sites, as these properties may sell quickly, once a price change has been completed.

See table below which shows unit sales history by month which has been pretty similar over the last 4 years.

Month

2012

2013

2014

2015

 

Jan

682

602

589

627

 

Feb

1008

914

870

853

 

March

1388

1167

1189

1208

 

April

1568

1573

1420

1570

 

May

1890

1804

1792

1926

 

June

1662

1594

1661

1694

 

July

1376

1339

1445

          1436

 

August

1145

1219

1203

          1279

 

Sept

995

1119

1133

          1244

 

Oct

1021

1069

1121

 

 

Nov

928

891

893

 

 

Dec

615

610

640

 

 

 


Frigid February Freezes Ottawa real estate 2015


No surprise that it was tough sledding in Ottawa real estate in February.  Record setting cold during the month may have deterred some casual buyers but underlying market weakness and an imbalance of supply and demand continue to be the dominant influences of the current market.

Unit sales down, prices flat:
Monthly unit sales were mostly flat compared to equally dull results recorded in February 2014.  Based on 5 year averages, residential sales during the month were down 6% and condo sales a whopping 30%.

The average condo selling price increased slightly during the month, while the average residential selling price was flat with a slight decrease of .3%.  Year to date average prices are flat for both residential and condo properties.

Will spring sales melt listing inventory and bring a flood of sales?
Listing inventory continues to grow well beyond expected accumulation in advance of the busy spring sales season.  Residential listing inventory at the end of February was 9% higher than last year and 31.8% higher than the 5 year average.  Condo inventory was 5% higher than last year and 58.2% higher than the 5 year average.  This clearly says there are more sellers in the market than buyers and this represents about 2,000 excess listings currently available right now and with 3 of the heaviest listing months ahead of us.  If sales do not increase significantly, we can expect our buyer’s market conditions to continue with significant pressure on selling prices for most properties.

Higher end listing inventory most challenged:
A quick synopsis of current listing inventory levels compared to 2014 sales suggests that we are overweight on listings $500K+.  For example: during 2014 sales of properties $750K+ accounted for only 3.1% of all residential sales yet currently account for 7.3% of listing inventory.  If one adds the $500-$750K category, sales above $500K in 2014 totalled 14.7% of all sales yet current inventory has 21.7% of total listings.  So those listing properties above $500K will want to be very careful with their list pricing, marketing and timing strategies. We expect to see this category of properties to also take longer to sell.

Outlook:
We are hoping that there may be some Federal Government budget thaw and pre-election goodies which would help our market.  Some reports suggest that there may be an uptick in DND personnel moves which is a very important factor in our spring/summer market here.

Ultra low mortgage rates may also move some buyers off the sidelines and in to the market.

Market timing:  …don’t miss the spring!
March, April and early May are the peak listing periods to get properties on the market for spring buyers.  If you have not made your plans, by all means check out our new 3 tiered commission rate plans* based on service levels which provide 2 broker support for MLS® listings for 2.99% (basic service) 3.99% (full service)  and 4.99% (premium broker service). Our 4.99% program we believe is unique in that it offers up to $3,000 in rebates/discounts for pre-listing preparation or staging to help you get your property in model home condition for listing.   All rates include a market standard 2.5% commission for a buyer representative bringing a buyer.  For more details please call 613-435-4692 or email oasisrealty@rogers.com.

* not intended to solicit those with existing representation agreements.

Call to schedule a realistic market evaluation:  613-435-4692
We are happy to provide a no cost no obligation market evaluation of your home focused on what you may realistically be able to expect from this challenging market.  We will tell you the marketing advantages of your property but we will also tell you the limitations and what we think you need to do to get the house sold in support of your housing objectives.

Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
613-435-4692 or cell/text 613-371-9691
www.oasisrealtyottawa.com
oasisrealty@rogers.com
@oasisrealtyOTT

Experienced, professional brokers with lower costs for sellers


The most important 91 days in Ottawa real estate: Starts now! (April 1st)


While the weather still has us wondering, there is no doubt that April 1st marks the start of the most important 91 days in the Ottawa real estate year.

3 Biggest Sales Months:
May is the #1 unit sales month of the year, followed closely by June #2 and April #3.  (see monthly breakdown over the last 3 years further down this page)  Some 35-40% of annual sales are transacted during these 3 months.

Why spring sales are highest:
Families typically prefer to move in the summer when school is not affected and vacation time may be easier to schedule to facilitate a move. 

Most properties also look their best after things “green up” in early May.

A very important factor elevating spring activity is that this is peak season for government relocations, particularly military personnel. These relocations account for as many as 2,000 housing transactions a year here in Ottawa.  Many military report dates will be in summer, therefore, house hunting trips start in April and really ramp up in May to facilitate summer closings.

How it affects sellers:
Sellers have to be prepared to list their property at the most appropriate time and keep abreast of what is going on in a fast moving spring market.  Prices change, new listings come out, and many are sold (200-250 per day on peak selling days at this time of year!)…remember, once these buyers have bought…they’re gone!

Sellers will want to have a good contingency plan, if their property is not selling within 30-40 days at this time of year, as this is absolutely the best time to generate an offer and a sale.  “Waiting for the right buyer” is unlikely to be a good strategy, if the property will not sell when the market is busiest.

How it affects buyers:
Buyers, who also have an existing property to sell, definitely want to find their next property when choice is best and also sell their existing property in the most favourable market conditions.

Buyers of new construction homes will want to be cognizant of what their possession date may mean for selling their existing property.  For example, a move in date in February for a new build, means you could be trying to sell in late Fall, when unit sales levels are dropping as fast as the leaves from the trees.  Unit sales decrease every month from the end of May and don’t really start to turn up again until next March.

The market favours buyer’s right now that’s for sure.  This doesn’t mean that buyers should try to negotiate outlandish deals or delay in offering on a property in the hope the price will drop.  With lots of buyers in the market, well priced and presented homes will still sell fast and buyers who are slow to make decisions may lose out on a property they want, so don’t let the deal become more important than the property itself.

“Domino’s”, “Daisy Chains” and “Train Wrecks” possible:
With our current buyer’s market conditions we can expect to see a lot of “first refusal” offers/agreements and also listings “subject to a specific property being available”.  These types of conditions are used to help buyers who also have a property to sell from ending up with two properties or no properties.  What can happen is that we have a number of interconnected transactions, each dependent on the others.  If the first “domino” or sale falls apart due to lack of financing, inspection or some other reason, then all connected transactions will be affected.  This is bad enough when it happens during a conditional sales period but is even worse if it happens on or just before closing day.  Lawyers call this situation a “train wreck” and given the current tight credit policies by major banks there is more than a chance of this happening this year than in any time in recent history.

A Realtor has the experience and tools to help minimize the risk of this happening and also for keeping both buyers and sellers on top of daily market conditions affecting their clients buying or selling plans.  For example, we offer our seller clients a “Competition Alert” system that allows them to keep an eye on competitive listings and also analysis on trends in their specific market area.  If you are not already working with another Realtor and would like this type of support for your property listing, by all means give us a call. 613-435-4692

Watch our Facebook page for special offers:  https://www.facebook.com/pages/Oasis-Realty-Brokerage-Ottawa/209265863918  or choose one of our unique Tiered listing service plans.  http://www.oasisrealtyottawa.com/Listing_deals/page_2598011.html

Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
oasisrealty@rogers.com
www.oasisrealtyottawa.com
@oasisrealtyOTT

Full service and lower commissions!