Real estate brokerage Royal LePage cuts Ottawa home price forecast for 2022

Royal LePage is cutting its forecast for home price growth in Ottawa this year after prices fell in the second quarter compared to the first three months of the year.

The real estate brokerage firm says it now expects the overall price of a home in the nation’s capital to rise 10% in the fourth quarter of this year compared to the same quarter in 2021.

That forecast is down from the firm’s April estimate, which predicted Ottawa home prices would jump 13% in the fourth quarter from the same period a year earlier.

Royal LePage says it has revised its forecast downward “to reflect a shift towards a more balanced market.”

In its latest home price survey, the real estate brokerage says the overall price of a home in Ottawa in the second quarter was $800,300, up 11.5% from a year ago. . However, this is a decline of 1.1% from record prices set in the first quarter of 2022.

The median price of a single-family detached home rose 10% year-over-year in the second quarter to $930,500, while the median price of condominiums fell 1% to to $416,900 over the same period.

Buyer demand ‘remains strong’

Royal LePage Performance Realty broker John Rogan said the town remains an attractive market for buyers from other parts of the country due to its stable economy and relatively affordable price.

“Despite recent interest rate hikes and rising home prices, buyer demand remains strong in the City of Ottawa,” Rogan said in a statement.

“However, in recent months, buyers have become more cautious, taking longer to bid and reintroducing conditions. Inventory is starting to rise slowly, but demand continues to outstrip supply. in high demand, low housing supply continues to lead to multiple supply scenarios.

Royal LePage now says it expects the overall price of a home in Canada in the fourth quarter of this year to rise 5% from the same quarter in 2021.

The forecast is down from an April estimate for a 15% year-over-year increase for the fourth quarter.

The brokerage says it lowered its forecast following more aggressive-than-expected interest rate hikes by the Bank of Canada, leading to an expected temporary drop in demand in parts of southern Ontario and Colombia. -British.

Royal LePage reports that the overall price of a home in Canada in the second quarter was $815,000, up 12.1% from a year ago. But it was down 4.9% from its record in the first quarter of this year.

The company says it was the first quarter in more than three years to show a quarter-over-quarter decline in home prices.

“Some of the heat that had been driving the market cooled in the quarter as rising interest rates coupled with economic uncertainty undermined consumer confidence and pushed buyers away,” said Royal LePage CEO Phil Soper said in a statement.

“We have significantly reduced our outlook for 2022, but house prices are still expected to end the year higher than 2021 and well above pre-pandemic norms.”

– With additional reporting from The Canadian Press