The number of real estate sales in February reached a new high of 1,421 on the Ottawa Real Estate Board, marking a 3% increase from February 2021.

The jump was much bigger, however, when compared to the market activity we saw in January.

Just 936 sales were made in the first month of 2022.

The question now is: is this an indicator of a market rebound for spring, or was this more of a temporary change?

Why sales went up

One of the main reasons for the resurgence of sales activity in Ottawa this last month was the number of new properties that went on the market. 1,762 homes and condominiums were listed in February 2022. That’s 12% higher than in 2021, and 4% higher than the 5-year average for February.

And, as a result, we are seeing a slight, but much-needed, increase in inventory for residential-class properties. However, condo inventory dropped by 20% from last year, leaving the overall inventory on the Ottawa market at just 0.7 months.

The average number of days on market for listings is steadily dropping, indicating that buyer activity has gone up in tandem with the increase in properties for sale.

So, why the sudden surge in activity? That is hard to say for certain.

What we do know is that inventory in the Ottawa area has been at an all-time low for several years now. This has caused a build-up of buyer demand. And that demand was only increased by the pandemic, as people began to move outward and look for larger properties with more space and more privacy.

But the dramatic increase in activity from both sides has experts wondering: is this an indicator of what the spring season will look like on the Ottawa Real Estate Board?

With government restrictions being relaxed and life seemingly returning back to “normal,” perhaps buyers and sellers who had been biding their time feel more comfortable and prepared to move.

Or, perhaps, this spike was more temporary and driven by apprehension around the Bank of Canada’s decision to raise interest rates last month.

The only way to know for sure is to watch what the market does in the coming months.

Still a seller’s market

Market activity may be picking up, but Ottawa is going to need many more new listings to meet the growing demand.

As of February, housing prices have continued to rise. The average condominium cost last month was $466,682, while residential properties averaged at $837,517 – a 15% and 17% year-over-year increase, respectively.

Even though the number of new listings has gone up, buyers are still facing fierce competition due to the overall lack of inventory. And, until that changes, buyers will continue to see high asking prices and multiple offers on plenty of properties.

That is why it is best to speak to a mortgage broker and have everything in order before making an offer on a house. Properties sell fast, but buying takes more time, preparation, and understanding of the market.