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Ottawa likely won’t see ‘real gains’ in new housing sales until 2026, homebuilders’ group says

July 28, 2025

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New home sales in Ottawa continued to gain momentum in June, but the head of a major local homebuilders’ group says he thinks it will be 2026 at the earliest before buyers really begin to jump back into the market in earnest. A total of 358 new housing units were sold in Ottawa last month, up 7.8 per cent from June 2024 and a 13.7 per cent increase over May, according to the latest housing market report from the Greater Ottawa Home Builders’ Association and PMA Brethour Realty Group. It also marks the busiest June in the past five years for the local homebuilding industry. Since 2021, an average of 257 new homes have been sold in the capital in June. Last month’s figures were further proof that consumers who were anxiously monitoring the Canada-U.S. trade war and the looming federal election earlier in the year are feeling better about the overall state of the economy, GOHBA executive director Jason Burggraaf told OBJ on Monday. “The resiliency of Ottawa’s local market in terms of sales is really quite something, especially when you consider how poorly virtually every other market across Ontario and a lot of the country is performing,” Burggraaf said. “Local consumer confidence is surprising.” But home sales still lagged behind last year’s pace at the halfway point of 2025. A total of 1,776 new homes were purchased across the city from January to the end of June, a 3.8 per cent drop from the 1,847 sales recorded in the same period last year. It’s the second-lowest six-month sales tally of the past five years and well off the pace of 2021, when nearly 2,700 new homes were sold in Ottawa between January and June. Burggraaf said ongoing economic uncertainty has dampened demand for new housing, saddling some builders with unsold inventory as buyers sit on the sidelines. “(Homebuilders) are moving forward cautiously and trying to keep their companies rolling as best they can,” he said. “Despite (Ottawa’s) relative strength compared to other markets, we’re still in a very low part of the market. People are kind of cautiously proceeding until the market really starts picking up steam, which right now doesn’t look like it’s going to be this year in terms of real gains.” Still, Burggraaf said he’s starting to see emerging signs that a rebound could be on the horizon. The new federal government’s proposal to scrap the GST on new houses valued up to $1.5 million that are purchased by first-time buyers is a welcome shot in the arm for younger Canadians struggling to afford a home of their own, he said. Meanwhile, most economists are expecting the Bank of Canada will hold its policy rate steady at 2.75 per cent for a third consecutive decision later this week. While that likely won’t jolt the market as much as a rate cut would, Burggraaf said maintaining the status quo on interest rates would be a welcome bit of certainty in a tumultuous economic climate. “I think people are seeing a period of steadiness and predictability in the market, and that’s allowed them to kind of jump in with some confidence,” he said. “I think people are tired of trying to time the market.” As a result, Burggraaf said he expects home sales for the rest of 2025 to “modestly increase” compared with a year ago. “I think the more predictable and the more steady the market is, the more likely (buyers are) going to jump in,” he added. Breaking down the numbers, the city’s south and west ends continue to be the most popular locations for homebuyers, each accounting for 34 per cent of all transactions in June. The east end captured 30 per cent of sales – much higher than the previous month’s 21 per cent – while central Ottawa accounted for the remaining two per cent. Townhomes continue to be the most popular housing type, representing 51 per cent of all sales in June as buyers seek out affordable options. Single-family homes accounted for 37 per cent of all sales, with condo townhomes constituting eight per cent of sales and condo apartments the remaining three per cent. – With additional reporting from the Canadian Press