Ottawa Condo Market Sees Sales Stall Ahead of Likely Spring Thaw

Downsizing empty nesters, retirees and first-time homebuyers fuelled steady demand in the Ottawa condo market in 2024, but the number of condominium apartments and walk-ups sold between January and August fell short of year-ago levels, according to a new report by RE/MAX. The Ottawa Real Estate Board reported just over 1,400 condominium apartments changing hands year-to-date, down less than one per cent from 2023. Meanwhile, the value of condo properties rose 2.3 per cent over last year, with average price sitting at $447,042.

Affordability remains a major concern in the Ottawa housing market, despite changes to monetary policy in recent months. First-time buyers find themselves locked out of the freehold market, given high interest rates and stringent lending policies. Fixed mortgage rates have dropped in recent weeks and are expected to continue to decline for the remainder of the year and into 2025, but potential buyers are still wary. Inventory levels have increased year-over-year as a result, with active listings in August hovering at 636, approximately 44.5 per cent ahead of 2023.

First-time buyers who choose to move forward with a purchase are typically looking for condominiums with low monthly maintenance fees and a parking spot priced from $500,000 to $550,000. The downtown core to Centretown and Dows Lake are popular destinations, given the proximity to the workplace, shops and restaurants. Those seeking to spend less could find a lower-priced unit in an older building for $350,000 but monthly condominium fees would be significantly higher. Suburban condominiums in areas such as Kanata, Barrhaven, and Orleans are also an option, priced from $375,000 to $400,000.

Tighter inventory levels exist in the luxury segment, where fewer condominium apartments are available over the $850,000 price point. Empty nesters and retirees are responsible for the lion’s share of activity in the top end of Ottawa’s condominium market. Westboro, the Golden Triangle, and Centretown, as well as neighbourhoods undergoing gentrification including The Glebe, Lansdowne, and Old Ottawa East, are most sought-after by buyers, many of whom are downsizing. Walkability is a major factor in these communities, with condominium apartments within walking distance to top restaurants and cafes, unique shops and picturesque walking paths.

As consumer confidence grows with each interest rate cut, more and more buyers are expected to return to the Ottawa condo market. Fourth-quarter sales are expected to be comparable to year-ago levels, but the outlook for spring of 2025 appears to be bright. Pent-up demand is building and those first into the market will reap the rewards.