The Current State of Real Estate in Ottawa
Since the pandemic, there’s one question I hear often: “What is the state of the real estate market right now?”
It’s a good question. Luckily, the answer is a positive one for both sellers and buyers.
To be specific, 2,189 residential properties sold this July in Ottawa, compared to 1,838 last July. That's a year over year increase of 19 per cent.
This might concern some buyers, but in fact, a strong market has long-term benefits. A good market can mean your investment is protected. The prices in the Ottawa remain strong, which in turn bodes well for properties retaining value.
Low Interest Rates
For buyers, there’s just as much good news. Interest rates are incredibly low — as low as 1.89% in some cases. This means that many buyers can secure historically low mortgage rates, ultimately reducing the overall cost of a new property, compared to what it might have been simply a few years ago.
There have been some changes to CMHC rules, but ultimately things are very positive for buyers.
The New CMHC Rules
Another change this year: the CMHC announced new rules that govern mortgages, effective July 1st, 2020, Changes include:
- A higher credit score required to qualify for an insured mortgage;
- The requirement to use one’s own funds (not borrowed) for a down payment;
- A reduced amount of debt that an applicant for an insured mortgage can be carrying at the time of their application.
The goal of these changes is to “protect the economic future of Canadians”, according to Evan Siddall, CMHC president and CEO. While the new rules appear more limiting, this will allow buyers to feel more secure that they can truly afford their purchase. That’s very reassuring, these days.
For both buyers and sellers, there’s good reason to be optimistic about this market. Sellers will still get a good price, and rather quickly. And buyers still have lots of options, along with great interest rates, and extra assurances that they’re only getting what they can afford.