Small Pullback of Price for Ottawa's Freehold Townhouses

The average condo price in Ottawa in June 2021 was $435,198 an increase of 21 perfect of June of last year. The freehold residential average in June on the other hand was $725,970 an increase of 26% over last year.

There is a $290,772 difference in the average of condos and freehold residential properties. While we are seeing builders continue to build out residential condo units in our City we tend to see more apartment-style condos being built. Few rowhouses or townhouse-style condos are being built these days.

For this reason, condo townhouses are often found in older areas of our City. Neighbourhoods like Pineview, Chatelaine Village, Blackburn Hamlet South, and Convent Glen South all have these condos that were built in the last 70's and early 80's.

Although these types of properties tend to be a lot less expensive than their similar freehold townhouses many buyers shy away from the condo simply because of their monthly condo fees. These monthly condo fees tend to include such things as building insurance, management, caretaker (grass and snow maintenance), condo reserve fund allocation (this helps pay for expenses like new windows, foundation work, etc), and water/sewer costs. 

There's been so much demand for Ottawa freehold townhouse style properties that from June 2020 to March 2021 there was under 1 month of inventory. This in turn caused many buyers to compete against other buyers to secure a property. Freehold townhouses like many other property styles were often selling within a few days of being listed for sale and for over their asking price. The months of December and January tend to not see too many listings because of the Holidays. This didn't help the situation for buyers as there were only 47 active freehold townhouse properties in all of Ottawa in December and 87 at the end of January.

Luckily, as Ottawa businesses started to slowly reopen after COVID closures we started to see more and more listings hitting the Ottawa MLS. At the end of June 2021, we now have a total of 295 freehold townhouses for sale on the Ottawa Real Estate Board.

The median sale price for freehold townhouses has gone from $580,500 in January of 2021 to a peak of $615,306 in March of 2021. Since then the median price has come back down to $595,000. This small pullback in price could be due to many buyers fatigued by the COVID lockdowns being away on vacation and not focusing on shopping for homes. This could also be combined with the fact that the inventory of properties has also been slightly improving which is translating to less competition for homes. 

I am of the opinion that this trend down won't last too long and we will see demand ramp up closer to the fall and winter provided COVID cases don't rise. COVID cases have been going down, 80% of the Canadian population has received their first dose and 63% have received their second dose. In Ottawa, 69% of our population of 12 years of age are fully vaccinated. 

As more businesses open up and border restrictions ease we will be seeing more immigration and travel into the country which in my opinion will increase the demand for housing in our City and likely have an effect on the price. 

Any change in mortgage rules or mortgage rates could have an impact on demand for real estate in Canada and more specifically in Ottawa. This said the Bank of Canada has come out to say that it will keep interest rates at near-zero until the economy is ready to handle an increase in rates which it expects won't be until the second half of 2022.

If you are looking to discuss the sale or purchase of a condo or house in Ottawa please call or text me at 613-889-7732 I'd be happy to discuss with you. Alternatively, you can email me here.