With home prices in Ottawa continuing to rise in recent years, there’s been an assumption that our market is on a housing bubble. How could prices possibly continue to rise if they already seem so high? Surely they’re due for a drop?
While home prices in Ottawa may seem exponential, the Ottawa Citizen makes a case that they’re actually quite reasonable compared to other Canadian cities, and they may rise further before they’re driven back down.
The author explains that housing affordability can be gauged by a statistic called the “median multiple,” which is “calculated by dividing the average house price by the average annual household income.” Ottawa’s median multiple is 3.5, which indicates home prices are “moderately unaffordable.”
Unfortunately for those hoping this means home prices are due to drop, that number could actually mean quite the opposite, as 3.5 is the lowest median multiple of all major Canadian cities.
What does this mean for home prices in Ottawa? The author says we’re likely to see prices continue to rise before they’re corrected through economic forces or government intervention.
“With a median multiple rating of ‘only’ 3.5,” he says, “home prices in Ottawa have the potential to rise much higher before they get to be as unaffordable as most other major cities in Canada.”
Whether you’re a homeowner considering selling or a buyer looking to get into Ottawa real estate, it’s important to get professional market advice before making your decision.
Contact Engel & Völkers Ottawa Central for more information on the future of home prices in Ottawa.Tags: Home Price in Ottawa, Home Prices, John King, John King Team, Ottawa, Ottawa Housing Market, Ottawa Real Estate, Ottawa Real Estate Market, Ottawa Realtor John King, Real Estate Market, The John King Team Ottawa
Categorised in: Ottawa Real Estate Market
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