Ottawa's best buy this fall already failed to sell once

About 1,500 Ottawa homes gave up in July

Yesterday I ran the reconstruction and published it: roughly 1,500 listings left the Ottawa market in July without selling, against 1,325 that actually closed. More homes quit the market than traded in it.

I wrote that one for sellers. Today I want to turn it around, because if you are buying in Ottawa this fall, that is the most useful number in the July release and nobody is pointing you at it.

Those homes did not disappear. They are still owned by people who listed because they wanted to be somewhere else by now, and most are sitting quiet while their owners decide whether to try again after Labour Day. That decision is being made this week and next, which is the entire reason for this post.

Only 18% of the available Ottawa homes actually sold

Here is the number that reframes the month.

Ottawa carried about 4,982 active listings into July. That one is derived, not published: OREB reported 4,678 actives at the end of July, down 6.1% from June. Add July's 2,530 new listings and roughly 7,512 properties were available at some point during the month.

1,325 sold. That is 17.6%. About one in six. Months of inventory at 3.5 says the same thing in politer language.

97.8% is a survivor statistic

OREB reported that Ottawa homes sold for an average of 97.8% of their asking price in July, down from 98.0% a year earlier. That number gets quoted back to me constantly, almost always as proof there is no room to negotiate. Sellers only come down two percent, so why bother pushing.

That figure is calculated on closed deals. It describes the 17.6%.

The other 82% produced no ratio at all, because nobody wrote an offer. Their gap to what the market would pay was not 2.2%. It was wide enough that no buyer engaged at any price. We cannot know the exact figure, and that is the point. Whatever it is, it is bigger, and it is attached to homes about to come back.

Days on market has the same defect. Ottawa's median went from 24 days in June to 28 in July, which reads like a market that moves, but that is the median of the homes that sold. A house that sat 70 days, terminated, and relisted in September shows up as a fresh listing with zero days on it. I flagged the gap between fast and stale Ottawa listings in early July and the July data widened it.

Three reasons a listing fails, and only one of them helps you

Every unsold Ottawa listing failed for one of three reasons, and your job is to sort them fast.

Price. The house is fine, the seller reached, and the market said no. This is the one you want. The seller has now spent 60 or 90 days being educated by silence, which is a far more effective teacher than I am.

The property. Grading that dumps water at the foundation, an addition with no permit, knob and tube behind the drywall, a third bedroom that is actually a den with a closet in it. A few of these are worth buying at a real discount with your eyes open. Most are not.

The seller. Testing the market, not actually going anywhere, or carrying a mortgage balance that makes the real number impossible. You can lose two months here and never get a counter.

The tell is in the price history. A seller who went $749,900 to $739,900 to $729,900 in $10,000 steps over three months was chasing the market down and never caught it. Price problem, and that seller is now realistic. One who never reduced is either unmotivated or badly advised, and one offer will tell you which.

Read the listing history before you read the house

Working with a REALTOR earns its keep here, and I know how that sounds coming from me.

What you see on a public listing site is the current listing. What I can pull is the full property history: original list price, every reduction with the date attached, cumulative days on market across every attempt, and whether the listing was terminated, expired, or suspended and how many times.

That separates a home that came out at a fair number last week from one on its fourth attempt since March wearing a brand new listing date. Both look identical to you. They are not the same negotiation. Ask me before you fall in love with anything.

The failed inventory is not evenly spread

Ottawa Centre had a sales-to-new-listings ratio of 39.6% and 5.6 months of inventory, with sales down 8.3% year over year. Apartments citywide ran 5.4 months of inventory, a 41.0% ratio, and a median 41 days on market, with the benchmark down 5.2% from last year.

Compare that to Ottawa Suburb West at a 56.2% ratio and 3.0 months of inventory, or single-family homes citywide at 3.2 months with the benchmark up 0.6% and sales up 5.0%. The suburbs took more than 70% of all July sales.

The stalled inventory concentrates downtown and in condo apartments. Hunting stale detached listings in Barrhaven, you will not find many.

Going after a downtown condo? Read what happens when the appraisal comes in under your offer first. In a segment down 5.2%, that risk is live.

What your offer actually looks like

Anchor on what comparable properties sold for, not on what this seller last asked. Their old number is information about their expectations, not about value.

Keep your conditions. I went through the mechanics in the buyer negotiation playbook and nothing in the August data changes that. On a home that already failed once the inspection matters more, because you are ruling out reason number two above. Twelve things worth checking is where I would start.

Then be direct. Someone who has already had the market tell them no does not need a lowball with a story attached. They need a real number and a clean close.

You have about three weeks

Labour Day is September 7. The Bank of Canada meets September 2 with a hold at 2.25% as the base case, so no rate catalyst is arriving to change anyone's mind.

After Labour Day, a good share of those quit listings come back with a new listing date, a fresh photo set, and an owner whose optimism has been restored by six weeks off the market. I have written about why the fall market will not save an unsold Ottawa listing, and it will not. The seller does not know that in week one, and you will be negotiating against renewed hope instead of accumulated fatigue.

Right now, before that reset, is the cheapest that inventory gets. Start with what is showing, then ask me which of them have a history.

If you want me to pull the full listing history on something you have been watching, or find the homes in your price range that quietly came off the market this summer, call me at 613-262-6545 or email fil@613realtor.ca. That search takes me an afternoon and it is not one you can run yourself.