Benefits of Real Estate Investing in Ottawa
Welcome to Ottawa, Canada's golden capital. This lovely town may not be the biggest city in Canada, but that hasn't kept people from discovering the joys of life in this vibrant city. With so many people flocking toward Ottawa, the city has become the perfect place for real estate investors looking to score big in a booming environment. If that sounds like you, make sure to give the Ottawa area a closer look. You’ll find that it’s not only a safe bet but a financially rewarding one, too.
Ottawa - A bulletproof market
It's official: the Canadian housing market may just be impervious to outside threats. Even in the wake of the COVID-19 pandemic, the real estate market throughout the nation remains strong. In fact, in the month of July 2020, the Canadian Real Estate agency recorded more than 62,000 home sales across the country. That's a 30 percent increase year-over-year. According to the organization, this number marks more monthly home sales than any other month ever reported since the CREA began keeping records more than 40 years ago.
In terms of success, you could see Ottawa as something of a microcosm of the rest of the nation. In July, as Canada witnessed more homes sales than any other month, the Ottawa Real Estate Board reported a 19 percent uptick in the number of home sales. As the number of home transactions rises, so is the average cost of a home.
Soaring home costs
If you wanted proof that the Ottawa housing market is hot, you need only look at the dramatic rise in home prices in the province. Though the average cost of a home stands at $501,000, the average price for a home during July 2020 was $585,000 and change. That's $14,000 higher than the national average. Add to that the competition at play on every sale, and you have a market that’s ripe for investing. More than half of the home purchases in Ottawa saw multiple competitive bids—the frenzy is very real.
The average costs of these homes are expected to keep rising for the foreseeable future, which means that for an investor with enough capital or the right combination of partners, the Ottawa real estate market is filled with opportunities.
The home building problem
If you read the above paragraph and found yourself wondering how someone could be sure that the Ottawa housing market won't level off or even crumble shortly, you’re not alone.
The reason experts remain confident in Ottawa's strength is due, in part, to a provincial issue that is common throughout Canada. Namely, builders can't build new homes fast enough. For months, the construction industry was forced to slow operations to a crawl. Even before that pandemic paralysis, the construction industry was still far behind in their quest to keep up with demand. In July 2020, the province's construction crews worked on about 740 new units. The vast majority of those units were apartments and multi-unit buildings. In other words, residential dwellings like single-family homes will remain a hot commodity.
Come to Ottawa (everyone else is)
The second reason that experts believe the Ottawa housing market will remain resilient in the future is the province's immense popularity. The capital city is not only pulling on more Canadians year after year but — for the second year in a row — the city became home to an enormous number of immigrants. As Statistics Canada put it, the "arrival of many permanent and temporary immigrants played a key role in [the region's] growth."
When the dust settled, Ottawa was the second-fastest-growing urban area in Canada. That's a trend that most believe isn't going away any time soon.
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Simple math
At first, it might seem as though the entry point for real estate investment in Ottawa is too high, but when you look at the larger numbers, the benefits become clear. More than 100,000 people moved to the area in the last year, but construction crews can only get to a couple of hundred new units every month. That means the current home prices are likely to be the basement prices for the future.
If you can collect the capital required to stake a claim on the Ottawa real estate market, now is the time.
A quick note about the apartment market
Those people hoping to break into Ottawa's lucrative housing market may want to skip the apartment rental scene. Even as the cost of a home has seen double-digit inflation over the last year, the average monthly rental cost of an apartment hasn't budged. Monthly rent on a one-bedroom apartment runs $1041; rent for a two-bedroom is $1232. Those rents run slightly higher than the national average, but they haven't shown any signs of rising to match the vibrant housing market. While apartments are holding steady, they may not offer you major financial gains for some time to come.
If you want to invest in multi-unit housing, you should consider exploring development opportunities as opposed to increasing the number of rental properties over which you exercise control.
Network to get work
If you need a leg up on entering the Ottawa real estate market, you're in luck. The capital city is home to the Ottawa Real Estate Investors Organization (OREIO). This not-for-profit organization educates members on the latest trends and newest laws in the world of Ottawa real estate investment. They also provide ample networking opportunities, so you can find the area's best real estate agents and property lawyers, as well as a group of like-minded people willing to team up for investment joint ventures.
Membership is $127 a year. If you're not up the membership fees, the city is home to less formal gatherings all the time. Just do a little homework and you’ll be able to find a group that’s right for you.
Ottawa’s housing market is booming, making it the right time to invest. Whether you’re just getting started or are a seasoned professional, investing in Ottawa could be a great move for you.
Real Estate Professionals in Ottawa
We have searched high and low for real estate investing professionals in Ottawa. Below, you can find professionals we have researched and can confirm they specialize in working with Real Estate Investors.
To ensure the maximum success in real estate investing in Ottawa, or any city, you should always use professionals who understand and work with investors, your income depends on it.
This list may not fully list all the professionals in the area, but the ones we have personally investigated and that we would refer our clients to.
If you’re a real estate professional and would like us to consider adding you to the list, please contact us.
Mortgage Broker
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