Ottawa home sales down for eighth straight month

A new home is displayed for sale in a new housing development in Ottawa on July 14, 2020. (THE CANADIAN PRESS/Sean Kilpatrick)

Ottawa home sales dropped 41 per cent in October as rising interest rates created hesitancy for buyers, the Ottawa Real Estate Board says.

A total of 987 residential properties were sold across the city of Ottawa in October, down from 1,670 from October 2021. It's the eighth month Ottawa saw a decrease in home sales from the year before, and the largest decline this year.

"After the volatility of the past two pandemic years, which was unsustainable, the market is correcting and adjusting," OREB president Penny Torontow said in a statement.

"The slowdown is compounded by Bank of Canada interest rate increases, which further exacerbates buyer hesitancy and weakens people's purchasing power – especially first-time homebuyers."

The Bank of Canada increased its overnight rate to 3.75 per cent form 3.25 per cent on Oct. 26, the sixth rate increase of the year.

Torontow says demand for housing is still high in Ottawa, with increasing inventory available.

"Buyers have more choices and time to shop for their new home," Torontow said.

"However, the ongoing speculation about where prices and interest rates are headed shakes consumer confidence and has made some prospective Buyers take a wait-and-see approach."

The Ottawa Real Estate Board says there were 2,047 new listings in October, a four per cent increase from 2021.

Home sales in Ottawa decreased 33 per cent in September, 27 per cent in August and 35 per cent in July.

The average sale price for a home in Ottawa was $577,873 last month, down five per cent from October 2021. Condo prices increased 9 per cent to $455,691.

The OREB says the year-to-date average sale prices of $780,390 for residential units is up eight per cent from last year, while the average sale price of $456,470 for condominiums represents a 9 per cent increase from October 2021.