Ottawa’s condo glut shows signs of easing

Default image

Ottawa’s housing market is much stronger than other cities across the country, but there remains a glut of new condos on the market. By Ryan Tumilty.

In a national housing analysis released this week, the Canadian Mortgage and Housing Corporation ranked the state of housing markets in all Canadian cities and found reasons for serious concern in Vancouver, Toronto, Calgary, Saskatoon and Regina.

In those markets, the corporation found unsupported price escalation and general overheating that could lead to a sharp drop in prices.

Ottawa, however, held up well, with only slight concerns from the corporation about overbuilding.

Anne-Marie Shaker, a senior market analyst, with the corporation, said while the market isn’t roaring, it’s stable.

“We have slowed down from previous highs no question about that,” she said.

The overbuilding concerns relate almost completely to the 535 condominiums currently in the city that have been completed, but not yet sold.

Shaker said no other segment of the housing market has a similar problem.

“It’s almost entirely in the condominium market. It’s a huge share,” she said.  

Shaker said that number is high, but compared to the 699 units that were in place in February, the trend is moving in the right direction.

“It’s slowly coming down. We do expect it to come down further. Builders are not building as much, allowing the inventory to clear,” she said. 

Shaker said this issue seems to be confined mostly to the condominium market and she doesn’t see it spreading to single-family housing or housing types.  

For renters, she said the current situation likely means the vacancy rate will remain at around 3.4 per cent where it has been for most of this year.

She said next year, when they expect housing sales will slow a little, the vacancy rate could tighten as fewer people take the plunge into buying a home.

This article originally appeared in Metro News.