The average sale prices of both homes and condos in Ottawa rose 19-to-20 per cent over the course of 2020, according to a group of local realtors, with activity in the city’s real estate market roaring back following a coronavirus-driven slowdown in the spring.
Members of the Ottawa Real Estate Board (OREB) sold 18,971 residential and condo-class properties in 2020, a two-percent bump over 2019 figures.
Though December experienced a typical holiday slowdown in comparison to preceding months, unit sales were nonetheless up 32.4 per cent year-over-year with just over 1,000 properties changing hands, according to OREB year-end numbers released Wednesday.
While the number of residential-class property sales was up three percent in 2020, the total number of condo sales dipped 1.5 per cent year-over-year.
The OREB has said in previous months that buyer behaviours shifted over the course of the pandemic, with the new work-from-home reality spurring many to seek larger living spaces.
Despite steady transaction numbers year-to-year, the annual growth in average sale prices accelerated in Ottawa in 2020.
The average sale price of a condo in 2020 rose 19 per cent to $361,337, while residential units retailed at an average of $582,267, up 20 per cent year-over-year.
OREB said the total sales volume of properties in Ottawa topped a value of $10 billion last year, up from $8.2 billion in 2019.
The 19-20 per cent increase in average sale prices for 2020 outpaces the nine per cent price increase seen in 2019 and the three-to-five per cent increase seen in 2018, according to OREB president Debra Wright.
“These substantive increases in property prices from year to year can be attributed to a variety of factors: the inventory shortage triggering economic supply and demand realities; the multiple-offer phenomena; the record-low mortgage rates increasing purchasing power of buyers; migration of buyers from larger markets with high returns to spend; and so forth,” Wright said in a statement.
Ottawa’s real estate market ended 2020 with average sale prices of $603,880 for residential properties and $355,982 for condos over the course of December, OREB stats showed.
Wright highlighted a drop-off in sales at the lower-end of the real estate market as a sign of eroding housing affordability in the nation’s capital. In 2019, 35 per cent of transactions were valued at $400,000 or lower; in 2020, the proportion of sales under $400,000 dropped to just 16 per cent.
While the start of the pandemic put a “momentary stall” on Ottawa’s housing market this past spring, activity picked up throughout the rest of the year and “accelerated past all expectations,” Wright said.
Ottawa’s economy, buttressed by strong public sector employment and a rising tech sector, has helped to keep the city’s housing market “resilient” during the pandemic,” she added.
Though the city has seen lower price thresholds than other major Canadian metropolises in the past few decades, Wright said Ottawa’s housing market “is now beginning to reflect the real estate property values of a national capital.”
“Going forward, I fully expect Ottawa’s resale market will continue to be robust in 2021. There are no indicators to suggest that this is an overheated market – it is simply very active, insulated, and strong. One that has only been mildly shaken by a world-wide pandemic,” she said.