Your Definitive Guide to the Ottawa Housing Market in 2023.

Market Report Summary for June 2023

• Ottawa’s average home sale price decreased 13.9% year-over-year to $613,000 for June 2023. While in comparison, provincially, the average home sale price is down 18.2% from a year ago to $1,081,500.
• The average price of a single-family home in Ottawa decreased by 15% year-over-year to $ 688,500 for June 2023. While in comparison, provincially, the average single-family home sale price is down 18.8% from a year ago to $1,189,100.
• The average price of a town/rowhouse in Ottawa decreased by 16% year-over-year to $631.582 for June 2023. While in comparison, provincially, the average town/rowhouse sale price is down 17.4% from a year ago to $847,500.
• The average condo price in Ottawa decreased by 17.1% year-over-year to $487,400 for June 2023. While in comparison, provincially, the average condo sale price is down 14% from a year ago to $734,500.
• The average rent for a 1-bedroom apartment in Ottawa increased by 14% year-over-year to $1750 for June 2023. While in comparison, provincially, 1-bedroom apartment rents are averaging $2,180, up 16.9% from a year ago.

Ottawa Housing Market Outlook

As of June 2023, data from the Ottawa Real Estate Board (OREB) indicates that the average home price in Ottawa is $613,000. Over the last month, there have been 1592 new listings, and the median number of days a home is on the market is 37 days. 

Ottawa house prices decreased by 13.9% compared to a year ago. However, housing prices increased by 1.5% in the last three months.  As prices increase incrementally, we see more balance returning to the market, albeit slowly.

Additionally, Ottawa’s sales-to-new listings ratio (SNLR) stands at 40% as of June 2023, showing power is still in the buyer’s hands as the market edges closer to the balanced territory. 

(For context, a market is considered a buyer’s market when the SNLR is 30% or less since a lower proportion of sales than listings indicates lower demand relative to supply.)

Who’s Buying Ottawa Real Estate?

Until recently, the primary demographics driving demand in Ottawa’s residential property market were those looking to upsize their homes, foreign investors looking to purchase an investment property in one of Canada’s most lucrative markets, professionals who recently immigrated to Canada in the past 5 years, and out-of-province migrants advancing their careers in the nation’s economic engine. 

With the passing of the omnibus Bill C-32 legislation, including the foreign buyers’ ban and anti-flipping tax, the Ottawa homebuyers’ demographic may be shifting away from foreign investment. However, it remains to be seen whether efforts to limit foreign buyers in Ottawa will have an impact; according to Statistics Canada, foreign investors make up less than 1.7% of the city’s total homeownership.

Multi-property Investors

According to a report by Teranet, investors and multi-property owners accounted for over 25% of Ontario’s homebuyers in 2021 and 1.7% in Ottawa. Consequently, Ottawa’s largest real estate market segment is first-time buyers (at 26%), the market’s largest segment until 2016.

Upsizing Buyers

Upsizing by buyers isn’t driving Ottawa’s demand for single-family homes, which showed the highest year-on-year price increase of all property types from $431,300 in February 2018, which is still more than 59.6% higher compared to today’s price at $688,500. Upsizing buyers also continued to explore secondary markets like Nepean, Gatineau, Gloucester, and Kanata over the last 6 months.

Immigration & Out-of-province Migration

While the pandemic saw thousands of homebuyers leaving urban areas searching for more space and affordable housing, new immigrants are making Ottawa homes continue to surge.  Although many Ottawans continue to leave Ottawa due to housing affordability limitations, many continue to move here. According to this report by Re/Max, the federal government expects to bring an additional 2 million new immigrants to Canada – many of whom will still choose to settle in Ottawa, as well as Montreal, Vancouver and Toronto.

First-Time Homebuyers

Getting a mortgage in Ottawa as a first-time buyer can be challenging for many – as property tax rates remain some of the highest in the country for a large city compared to property values. 

While programs like the First Time Home Buyer Incentive are in place to help people afford homes in the city, this has yet to do much to offset affordability as the stress test makes it harder to qualify. At the same time, the Bank of Canada keeps rates elevated – adding a barrier to qualifying for a home without a combined household income over $150,000. 

Given the slowdown over the last 12 months in home prices, Ottawa remains a difficult market to purchase a first home without outside financial assistance. Surprisingly, first-time homebuyers remain the city’s largest real estate market segment. 

Average Home Prices in Ottawa for June 2023

With the Bank of Canada finally pausing its rate-tightening cycle, now may be the perfect time to buy a home in Ottawa before the storm. Many experts say the housing market should pick up by the end of 2023 when rates are expected to decline. Timing the market in Ottawa is precariously hard as the pent-up demand sitting on the sidelines is ready to pounce at the perfect combination of lower prices and rates.

Average home prices in the city have dropped significantly compared to last year, with a 19.3% decrease in the average price of a single-family home compared to a year ago. The average price of a detached home in Ottawa was at its highest at $1,603,800 a year ago. Contrast this to the current price for a single-family home at $1,294,100, and it becomes apparent that Ottawa’s market is undervalued. 

Below we have compiled some insights from Ottawa’s real estate experts at Ottawa Real Estate Board (OREB).

Ottawa House Prices & Sales

Ottawa Condo Prices & Sales

Ottawa Historical Housing Price Changes by Property Type

Free Hold Prices Increase in Ottawa for June 2023

More generally, Ottawa and Ontario real estate have seen some of the most widespread and persistent levels of price appreciation in the last 20 years. Driven by property investment, upsize buyers, immigration and provincial migration.

Residential sales activity in Ottawa slowed in the fourth quarter of 2022 compared to the fourth quarter of 2021. Residential property sales numbered 2,430 units in the fourth quarter of 2022, down significantly compared to the same quarter in 2021. Sales slowed 34.7% for single detached homes, were down 41.5% for townhouse and row units, and were down 44.8% for apartment units compared to a year earlier in the fourth quarter. Annually, residential property sales numbered 14,822 units in all of 2022. This was up 21.2% compared to the 12,234 units recorded in 2021.

• The average sale price for a freehold-class property in February was $708,968, a decrease of 15% from 2022. However, it marks a 5% increase over January 2023.

• The average sale price for a condominium-class property was $410,927, decreasing 12% from a year ago.

• With year-to-date average sale prices at $695,086 for freeholds and $411,449 for condos, these values represent a 14% decrease over 2022 for freehold-class properties and a 10% decrease for condominium-class properties.

“The average price increase for freeholds over January could indicate that buyers have normalized to the current interest rates. And perhaps, it’s a glimmer of more activity in the months ahead.”

Analysis & highlights from News Releases from the Ottawa Real Estate Board (OREB) and the Canadian Real Estate Association (CREA)

Good News for Sellers in Ottawa for June 2023

More generally, Ottawa and Ontario real estate have seen some of the most widespread and persistent levels of price appreciation in the last 20 years. Driven by property investment, upsize buyers, immigration and provincial migration.

• Months of Inventory for the freehold-class properties increased to 2.8 months from 0.7 months in February 2022.

• Months of Inventory for condominium-class properties increased to 2.5 months from 0.7 months in February 2022.

• February’s new listings (1,366) were 22% lower than February 2022 (1,762) and up 3% from January 2023 (1,323). The 5-year average for new listings in February is 1,632.

• Days on market (DOM) for freeholds decreased from 43 to 37 days and 47 to 43 days for condos compared to last month.

“A decrease in the days on market, paired with fewer new listings entering the market, is good news for sellers,” says Dekker. “However, if that trend continues to impact our supply stock and we don’t get more inventory, our otherwise balanced market could swing back into seller’s territory — but it’s too early to predict.”

Analysis & highlights from News Releases from the Ottawa Real Estate Board (OREB) and the Canadian Real Estate Association (CREA)

Ottawa Rental Breakdown June 2023

Average rental cost comparisons between Ottawa and other municipalities in Ontario or nationally.  

Each $100K in mortgage balance costs an average of $550 per month for principal and interest on the current insured fixed rate and $620 per month on the current insured variable rate.  Rates used for calculation are those offered on insured purchases with less than a 20% downpayment over 25 years of amortization.  Each 0.25% change in mortgage rates impacts the monthly payment by $14 to $16 on a 25-year amortization.

Ottawa Rental Prices Compared to Other Canadian Cities

As the table below shows, Ottawa is the 9th most expensive city for rentals in Ontario and 15th nationally.

Province	Total	Bachelor	1Bdr Average	2Bdr Average	3Bdr Average	Total YoY Change
Vancouver BC	$3,146	$2,276	$2,765	$3,727	$4,200	18.70%
Burnaby BC	$2,866	$1,747	$2,286	$3,171	$3,638	19.90%
Toronto ON	$2,818	$1,987	$2,516	$3,301	$3,890	22.40%
Etobicoke ON	$2,587	$1,967	$2,285	$2,848	$2,888	21.40%
Mississauga ON	$2,549	$1,876	$2,253	$2,688	$3,047	21.50%
Brampton ON	$2,518	$1,709	$2,143	$2,624	$2,909	29.10%
North York ON	$2,497	$1,657	$2,174	$2,706	$3,376	24.10%
Kelowna BC	$2,402	$1,530	$1,932	$2,728	N/A	3.60%
Barrie ON	$2,363	$1,575	$2,019	$2,583	$2,626	12.30%
Surrey BC	$2,342	$1,938	$1,951	$2,497	$2,627	17.90%
Halifax NS	$2,215	$1,732	$2,089	$2,425	$2,890	20.10%
Victoria BC	$2,214	N/A	$2,004	$2,513	$3,325	7.30%
Kitchener ON	$2,195	$2,324	$1,944	$2,405	N/A	21.00%
Hamilton ON	$2,106	$1,640	$1,890	$2,308	$2,369	21.40%
Ottawa ON	$2,090	$1,625	$1,925	$2,363	$2,485	15.40%
Oshawa ON	$1,979	$1,348	$1,825	$2,123	$2,185	9.30%
London ON	$1,978	$1,394	$1,775	$2,123	$2,559	24.60%
Kingston ON	$1,921	$1,633	$1,700	$2,136	$2,278	13.20%
Calgary AB	$1,890	$1,276	$1,686	$2,048	$2,393	24.90%
Montreal QC	$1,876	$1,365	$1,619	$2,155	$2,455	10.90%
Winnipeg MB	$1,478	$1,066	$1,320	$1,615	$2,055	13.60%
Lethbridge AB	$1,314	$1,056	$1,212	$1,387	$1,600	17.80%
Edmonton AB	$1,300	$940	$1,147	$1,475	$1,574	11.20%
Saskatoon SK	$1,176	$877	$1,122	$1,234	$1,438	9.30%
Regina SK	$1,139	$849	$1,072	$1,290	N/A	13.90%

Ontario Rental Prices Compared to Canada and the Provinces

As the data below shows, Ontario is the least affordable province for rentals after BC among the provinces, with a population of over 1 million inhabitants.  

Average Rents by Housing Type

Province	Total	Bachelor	1Bdr Average	2Bdr Average	3Bdr Average
AB	$1,461	$981	$1,307	$1,628	$1,668
BC	$2,441	$1,904	$2,168	$2,857	$3,342
MB	$1,463	$1,066	$1,310	$1,588	$1,814
NS	$2,167	$1,723	$2,029	$2,368	$2,586
ON	$2,401	$1,802	$2,180	$2,649	$2,954
QC	$1,839	$1,329	$1,589	$2,035	$2,340
SK	$1,097	$856	$1,034	$1,173	$1,351
CA	$1,937	$1,395	$1,749	$2,127	$2,402

Rental Growth by Housing Type

Province	Total YoY Change	Bachelor YoY Change	1Bdr YoY Change	2Bdr YoY Change	3Bdr YoY Change
AB	13.40%	0.60%	13.00%	14.80%	7.30%
BC	13.20%	8.40%	11.00%	13.00%	6.40%
MB	12.60%	13.80%	14.60%	12.50%	5.60%
NS	20.80%	14.10%	22.70%	21.00%	33.60%
ON	17.10%	19.00%	16.90%	15.80%	13.60%
QC	22.20%	2.80%	9.80%	9.90%	6.00%
SK	8.00%	13.30%	8.70%	7.70%	7.00%
CA	10.90%	4.90%	10.10%	10.70%	6.80%

Frequently Asked Questions

Final Thoughts

Ottawa’s property market is set to remain strong as increases are expected for the remainder of 2023. The average home price in Ottawa has dropped significantly over the last year. However, this comes after months of record consecutive price rises during the pandemic and one of the most intense periods of price appreciation the city has ever seen. 

While the property market appears to be shedding value in Ottawa, it’s important to remember that this is relative to a long period of superheating in the area. 

If are you looking for a home in 2023, expect an imminent turnaround in the housing market over the next few months. Contact our knowledgeable and commission-free mortgage experts at nesto to help guide you through the home-buying process.

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