Ottawa Real Estate Market Rebounds After Brief Slowdown

As the nation’s capital, Ottawa has enjoyed a stable residential real estate market for much of the 30-year period, with consistent growth in values reported through 1996 to 2022, dipping slightly in 2023 but bouncing back in 2024. Recent homebuying activity remains steady but cautious, given overall market uncertainties and an overnight rate fixed at 2.75 since early 2025.

Affordability continues to differentiate the Ottawa market, with a good selection of homes available at most price points. While average price hovered at close to $691,000 at year-end 2024, demand continues to be strongest for freehold product valued at lower price points, ranging from $500,000 to $700,000. Townhomes and smaller single-detached homes tend to move quickly, but a lack of supply at this price point continues to frustrate buyers, especially as a healthy fall market is shaping up. Overpriced properties at all price ranges continue to linger.

Despite lower prices, first time buyers continue to be challenged in terms of accumulating a down-payment and “passing” the stress test, especially given the burden of student debt and rental payments. Income has not kept pace with the cost of living, making it increasingly difficult for younger buyers to enter the housing market. Home-ownership rates sat at 65.4 per cent in Ottawa in 2021, according to Statistics Canada Census Data, a decline of just over three percentage point from 2011’s peak of 68.6 per cent.

Immigration and in-migration, especially in recent years, has contributed to Ottawa’s growth, with the city’s population up 69.3 per cent since 1994, bringing the total number of residents to almost 1.3 million. With an abundance of un-serviced land available in Ottawa and surrounding areas, increasing the supply of homes is a viable answer to the rise in new residents. Targeted development of freehold housing would help to keep younger buyers in the area and reduce the incentive to relocate to more affordable markets. Policy levers that previously bolstered affordability — such as federal policy supporting CMHC’s insured 40-year amortizations and zero-down mortgage (2006-2008) — merit renewed consideration, along with measures such as tax credits for first-time buyers, higher RRSP withdrawal limits and a recalibration of the stress test.

The federal government’s return-to-office mandate should serve to reinvigorate Ottawa’s ailing downtown core. However, concerns over federal austerity policies and the potential for future layoffs have given buyers pause at present. Even so, ongoing population growth through immigration, generational wealth transfer, and Ottawa’s track record of measured, sustainable growth provides important offsets to uncertainty, reinforcing the market’s long-term resilience.