When I set out last year to undertake this exercise I was optimistic 2018 was going to be a good year. I could not predict just how hot our market was going to be. Early in the year, there was a significant shortage of housing inventory across the city. This of course is a huge challenge for my military clients who are coming in for their house hunting trips. Low inventory makes it extremely challenging to find something on the time crunch of a house hunting trip. Especially in the most active price ranges. The most price range in 2018 was 300-450k. In many cases, our clients were offering against as many as a dozen or more other buyers. This is common practice in cities like Toronto but a newer phenomenon here in Ottawa. There was lots of newer inventory by Spring but it only helped marginally. It was still a seller’s market but as the year went on it became less competitive for properties. Instead of 12 offers on many of the listings, we started seeing 2-4 offers depending on price range. This past year I was able to match up 3 military clients with off market properties. This really helped. We always have “off market” opportunities that we can offer to our preferred military clients on their Ottawa House hunting trips. To better understand the market it is good to look at the stats. Let’s have a look at the numbers driving our market.
KEY INDICATORS
AFFORDABILITY
Ottawa households have one of the highest household income averages in Canada. If you see the graph on the following page you can see that prices are still relatively affordable for Ottawa buyers. This graph looks very different for buyers in cities like Vancouver and Toronto. This is taken from the popular military neighbourhood of Fairwinds in Stittsville.
IMMIGRATION
If you Google best places to migrate to in Canada, Ottawa seems to be the number one choice. I am seeing many more immigrants choose Ottawa as their final destination. Toronto and Montreal are of course popular but when someone researches where to live in Canada, Ottawa comes out close to number one in almost all categories.
The common misconception out there is that these immigrants do not have the funds to purchase real estate. That is not always the case. In many instances, it is their credit or lack thereof that may be holding them back. In any case, these immigrants are coming at a record pace and will likely be purchasing real estate in the future.
MORTGAGE RULES AND INTEREST RATES
Banks have been forced to stress test buyers at a full 2 percentage points higher than the interest rate of their mortgage. This can impact purchasing power by almost 20%. I see the need for this but as house prices rise in major market centres there has been plenty of pushback. Interest rates have been slowly rising and this has put pressure on affordability for some buyers. If this trend continues it will have an impact on the market for sure. With the economy being more sluggish, the need for further increases may be curbed.
LOCAL ECONOMY
Ottawa has always been an underrated city in my view. We have a strong local economy with one of the highest median household income averages in Canada. Our unemployment rate is at historically low levels. It is a prototypical government town that has a growing technology sector and lots of solid, high paying professional jobs. It is only a matter of time before our prices surge and we become a global player in real estate. For a world-class capital city our prices still might be a bargain. Time will tell!
ELECTION YEAR
Housing affordability has climbed up to be one of the top issues for millennials. This makes it an election issue. A recent poll found that 64% of millennial voters want the government to do something about climbing prices. We will see the politicians respective platforms later this year. My prediction is that some of these platforms will have policies that will make it easier or more affordable for buyers to purchase. It could mean the return of 30-year amortizations. The stress tests might be eased or there could be a new policy altogether. Something to watch for sure.
MILITARY AND TECHNOLOGY
The DND move to the Nortel campus has been a major factor in the recent price appreciation in many of Ottawa’s west neighbourhoods. Interestingly, it is still a few years away from being fully operational as they phase employees into the new headquarters. In 2018 there was a major announcement that another prominent military operation headquarters will be built in close proximity within 10 years. The new building will house over 4500 employees. This will have an impact down the road on our real estate market. The location has not yet been announced but I have heard it will be at Shirley’s Bay just west of the DND. Once operational the mili
GROWTH AND INFRASTRUCTURE
Ottawa is growing and maturing into a world-class city. We should all be grateful to live in a city with such a high quality of life. By March we will have light rail going right downtown that will make life easier for commuters. This will just be the start of a much broader transportation plan. We have a super hospital that will be coming online in the years to come. Lebreton will eventually get the green light for redevelopment. Lots to be excited about. These will help fuel our economic growth in the years ahead.
2019 FORECAST
I believe it will be another strong resale year for Ottawa homebuyers and sellers in 2019. There is still pent-up demand and lots of buyers looking to purchase. This was reinforced just before Christmas as our team was involved in 2 multiple bid situations in the Fairwinds area. The targets were modern semi-detached townhomes, one that we sold for a record price with 3 offers. This is not the kind of activity you would typically see just before Christmas. It is indicative of the market in the entry level price points. The $350k-450k market will continue to be red hot this year. I have spoken with a few builders who had record years. Next year many homebuyers will be on the move to their newly built homes. This will hopefully create some much-needed inventory in 2019.
I predict we will have another seller’s market that will slowly slide to a balanced market by the time 2019 is complete. Barring an international crisis, it will be another great year for the Ottawa Real Estate market.
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To support the aircraft testing, staff will be relocating to Ottawa and the existing Alberta military facilities will be shutting down to create the new centre of excellence in Ottawa. The Aerospace Engineering Test Establishment (AETE) has been at Cold Lake, Alberta since 1971 and will be relocated to the international airport in Ottawa and partnered with National Research Council Flight Research Laboratory and Transport Canada Aircraft Services Directorate. Of the 166 military personnel and 22 public servants that are employed there, one-third of the unit will be affected and the remaining two-thirds will be reassigned to other air force functions.
The move will save approx. $14 million a year and free up space for the arrival of more fighter jets at the Cold Lake location. Canada is currently committed to purchasing 88 new jets to replace the existing fleet of CF-18s and in the process of purchasing used fighter aircraft from Australia.
This past year was very challenging for my Ottawa house hunters. Our market is as hot as I have seen it in my 14 years. When my military buyers were in town this year the lack of inventory made purchasing harder. Not only that but when sellers are holding offers until a certain date and time it does not work well for my clients. They often have a 3-4 day window to purchase and cannot wait. Fortunately, my clients were all successful in purchasing on their house hunting trips this year. I can honestly say it is because of the groundwork we did before everyone arrived. I have been getting off-market homes on a list that 2 of my incoming military clients purchased. We plan to double down on this for 2019. We are already working on an off-market MLS basically exclusively for our military clients.
I do believe that 2019 will be another “hot” market in Ottawa. The economic indicators all point to this happening again. Our team will be well prepared to make sure all our military clients have access to good options that are not available to the public. If you want to chat more about your house hunting trip please email chris@chrisscott.ca to set up a time to chat. I look forward to being of service.
As a relocation specialist, the first question that buyers often ask me is about commuting to the new NDHQ. For many, this will determine where they will purchase. Right now there is plenty of parking available at the facility but this may change over the upcoming years as more people get transferred to the building. OC Transpo has been working with the city and CAF officials to create a viable plan for those taking the bus.
Most customers across Ottawa will be able to travel to Carling campus with one transfer on bus routes 101, 103, and 152. The city extended the transitway from Bayshore to the Moodie off-ramp to help accommodate the extra bus users this relocation is going to create. Here is a map of the bus routes.
Many of my clients who are relocating to Ottawa end up choosing areas Stittsville, Kanata, and Barrhaven due to its relatively close proximity to the Carling campus. We are always happy to chat with you about your move. Feel free to reach out via my cell at 613-863-6999 or fill out our HHT booking ADD LINK sheet and we will be happy to assist. We have been doing this successfully for 14 years. We have an excellent track record of results and would be happy to assist.
For more information regarding Ottawa transit click here, it will give you some great insight into transit times to major DND work locations.
House hunting trips can be challenging for buyers who are not familiar with Ottawa. We really only have a few days to explore its neighbourhoods and secure a house. In the east end of Ottawa, many of my military clients are comparing the markets of Orleans and Rockland. Here is a brief summary of the two locations:
Rockland: This is a rapidly growing neighbourhood that is outside the city of Ottawa boundaries. It is situated about 40 km to downtown Ottawa. Housing prices are much more appealing to families looking to stretch their dollar. You drive further but get more. In many cases, you can get a detached home for the same price as a newer townhouse in Orleans. For many this is enough to take on a longer commute each day. It is, however, important to note that resale can be a bit more challenging in Rockland. Houses tend to stay on the market longer.
Orleans: This is an Ottawa East suburb with a population of over 100,000 people about 16kms to downtown Ottawa. Always, a very popular location with lots of amenities, schools, and good transit connections to downtown. The future LRT line will make access even easier in the years to come. Resale is much easier when compared with Rockland but prices can be 100k more than Rockland for the same detached 2 storey/double garage house.
In a recent house hunting trip, my clients who were up from Washington ended up looking in both Orleans and Rockland. He was posted to Letrium and felt like Rockland would be the better choice because of its value proposition. They ended up securing their dream house there for $425k. That house would have been 550k plus in Orleans. It really is that big of a price difference depending on the style of housing.
If you are debating between these two locations on your relocation to Ottawa please feel free to get in touch. I would be happy to send you options in both locations.
Interesting article in the citizen that I had the pleasure of contributing on. As a military Realtor, I often get asked the impact a hot market has on my military clients.
If you are in need of a military Realtor that knows Ottawa well and has experience with HHT’s please feel free to get in touch. This is what we specialize in.
Ottawa is increasingly becoming a city with a clear price differential between some of the East end suburbs when compared to the west. Nothing could have illustrated this more than a recent house hunting trip. My clients were looking in both Barrhaven and Orleans with a budget of under 500k. They had Barrhaven as their ideal location but were open to looking at other areas. After looking at 15-20 properties together It was clear that one could get more house/square footage in Orleans for the same price as something in Barrhaven. The bigger question for my clients was is the price difference enough change their mind on Orleans?
Price of a detached 2 storey home with a one car garage:
Orleans: $427,000 (YTD sales Jun 4/18)
Barrhaven $454,750 (YTD sales Jun 4/18)
In the end, my clients went with their preferred location. They (as do I) see the future of Ottawa being more West-centric. Especially for the military with its new DND location and the upcoming construction of the operational headquarters. My clients decided to pay a premium to be in the location they wanted. As a military Realtor, it is always good to look at future resale as well. I think because of the shift in DND jobs to west-end it will be a bit easier to resell in the future.
Orleans also has some great future prospects as well. Amazon just announced a new 1M square foot distribution centre and the LRT will extend out East in its next phase. The nice thing about buying in Ottawa is that no matter what location you choose, you cant go wrong! Our real estate market is one of the worlds most stable.
If you are in need of a military Realtor that knows Ottawa well and has experience with HHT’s please feel free to get in touch. This is what we specialize in.
DND has announced plans this week for a new operational headquarters that will be home to some 4500 civilian and military personnel. The plan right now is to have this completed by 2029. The site has not been finalized yet but DND spokesperson said it will be in close proximity to the new headquarters at the Nortel campus. It will centralize operations and involve vacating the Star Top Road facility in the East End. In the end, this will mean that this area will house over 13,000 personal when you include the 9000 that will be at the new DND headquarters when it is fully operational. Personally, I think this makes sense as it will make communication/synergy much easier and provide long-term savings. Having so many buildings scattered throughout the city has not been the most efficient way of running things.
This new building will have an interesting effect on real estate prices in Kanata and Stittsville. These areas will continue to be the locations of choice for military families. Add in the LRT line that will be operational out that way by 2029 and I believe the long-term growth of these real estate markets will be awesome.
If you are relocating to Ottawa or have any questions, please get in contact with us. This is what we specialize in.
We had some clients come up from Kingston for a recent house hunting trip. Knowing the market was active they kept a wide price range and a large area of interest. This presented lots of options for them. The challenge became that their short list consisted of some very different styles and neighbourhoods. It made for a challenging decision that they wrestled with. Nobody said it would be easy to buy a house on a house hunting trip! Here were the final 4 houses they were looking at.
1) Beacon Hill- house that was $650k in a great neighbourhood with a pool
2) Findley Creek- Two houses, one at 599k and the other at $489 (in Sundance area)
3) Alta Vista- Completely redone house at 670k. The only challenge was the yard was on the side of the house rather than behind it (corner lot)
4) Small bungalow in Hunt Club priced at 519k
In the end, my clients decided on the Beacon Hill house because of its proximity to downtown. Unfortunately after winning the house in a multiple offer situation the inspection did not go as planned. Our inspector Sean brought forward some concerns that were in the end to hard to overcome. They moved on to their safe choice on Ivy Green in Sundance. I believe this to be the easiest to re-sell down the road and the fact that it is newer will allow my clients just to move right in. The Alta Vista house was tempting but with no proper yard, it just leaves a future question mark on resale. With military guys, it is so important to find something that will sell quickly in any market. The LRT will be in Sundance area in the future, I think this will help ensure this will be a great investment for my clients. The point of the story is that sometimes it is easier to have a more refined search criteria and choose between more similar properties. More selection doesn’t always mean an easier decision.
If you are relocating to Ottawa or have any questions, please get in contact with us. This is what we specialize in.
Ottawa is the most challenging place in the country to buy a property right now. According to the Canadian real estate association, Ottawa is the hottest market in Canada and it’s not even close! This presents an interesting set of challenges for military buyers. They have only limited time on their house hunting trips. There is much less to look at and you really can’t start favouriting too much before you arrive because the good houses are usually sold. I have been trying my best to get off-market listings ready for my clients before they arrive. This past week we had some great success with Corey and Marie who bought a house that was off-market. It was a brand new house that had closed only a few weeks earlier. It was the first place they looked at on Monday and it stood up against everything else we looked at. These exclusive opportunities are one way I am trying to give my military house-hunting clients a leg up over the competition. It is the second off-market deal we have done in this regard this year. In both cases, it was a win-win for everyone involved.
If you or someone you know is relocating to Ottawa please feel free to get in touch. This is what we specialize in.
