In one of the first forecasts predicting Ottawa’s real estate market could soften over the coming year, the Canada Mortgage and Housing Corp. says home prices will drop in 2021 before inching up again the following year.
In a special Housing Market Outlook report covering the country’s major cities, CMHC says local residential property prices will remain strong this year, averaging between $451,500 and $481,000. However, the Crown corporation expects that to drop to between $406,000 and $460,000 in 2021, thanks to weaker demand for homeownership due to job and income losses.
As demand recovers in 2022, prices are predicted to tick upwards due to limited supply caused by fewer homes being listed on the resale market and lower levels of new home starts, CMHC says.
The report adds that housing starts will trend lower throughout 2020, both because of uncertainty surrounding the COVID-19 pandemic and the high level of inventory under construction that’s tying up scarce labour and equipment.