As 2024 wrapped up, Ottawa’s real estate market showed signs of resilience and optimism despite ongoing challenges. December closed out the year with 613 homes sold through the MLS® System of the Ottawa Real Estate Board (OREB), marking a 7.9% increase from December 2023. While sales remained below five- and ten-year averages, the year ended on a more encouraging note, with year-to-date sales totalling 13,526 units—an 11.8% jump compared to 2023.

Let’s break down what these numbers mean and explore the trends shaping Ottawa’s real estate landscape.

2024: A Year of Cautious Optimism

The real estate market in Ottawa saw some positive movement in the latter half of the year, thanks to consecutive interest rate cuts, higher insured mortgage limits, and extended amortization periods. These changes have provided a bit of breathing room for buyers, but affordability and supply remain significant hurdles.

With new listings on the rise and a surge in active inventory, sellers appear to be preparing for improved market conditions. However, affordability continues to limit buyers’ options, particularly for entry-level homes and budget-conscious shoppers.

By the Numbers: Prices and Market Trends

Price Growth Across Property Types

The MLS® Home Price Index (HPI), which provides a more accurate picture of price trends than averages or medians, showed overall growth in December 2024:

• Overall Benchmark Price: $645,800, up 3.8% year-over-year.
• Single-Family Homes: $729,300, a 3.7% increase from December 2023.
• Townhouses/Row Units: $533,200, a remarkable 11.3% jump year-over-year.
• Apartments: $404,400, reflecting a 2.5% decline compared to last year.

While single-family homes and townhouses saw healthy price increases, apartments experienced a slight dip. This could indicate shifting buyer preferences or affordability constraints.

Average Home Prices

The average price of homes sold in December 2024 was $663,781, up 4.4% from December 2023. Year-to-date, the average price across all property types stood at $679,067, a modest 1.3% increase from 2023.

Inventory and New Listings: A Balancing Act

New Listings on the Rise

December 2024 saw 603 new residential listings, up 13.6% from December 2023. While this was slightly above the five-year average, it remained below the ten-year average, reflecting a gradual recovery in listing activity.

Active Listings Surge

Active residential listings jumped significantly, reaching 3,216 units by the end of December—a 58.7% increase year-over-year. This is 90% above the five-year average and 51.4% above the ten-year average, signaling a more balanced market compared to the tight inventory of recent years.

Months of Inventory

The months of inventory, which measures how long it would take to sell all available homes at the current sales pace, increased to 5.2 months (up from 3.6 months in December 2023). This indicates a shift toward a more buyer-friendly market, though challenges remain for those seeking affordable options.

Looking Ahead: What’s Next for Ottawa Real Estate?

The year ended with a sense of cautious optimism. Buyers are watching the market closely, weighing their options as interest rates stabilize and new mortgage rules come into play. Sellers are gearing up for what they hope will be a more active spring market, buoyed by increasing inventory and a potential uptick in buyer confidence.

However, affordability and supply challenges continue to create friction. Entry-level homes, in particular, remain in high demand but low supply, limiting options for first-time buyers and those looking to upsize.

Political shifts and policy changes on the horizon could also impact the market, adding a layer of uncertainty. Still, with improving conditions and growing optimism, there’s hope for increased activity in the months ahead.

Key Takeaways for Buyers and Sellers

• For Buyers: The market is becoming more balanced, offering more inventory and opportunities for negotiation. However, act quickly if you spot a property that fits your needs—affordable options still go fast.
• For Sellers: While inventory is increasing, competitive pricing remains key to attracting buyers, especially in a market still grappling with affordability concerns.

2024 may have been a year of transition, but the foundations for a stronger, more active market in 2025 are in place. Whether you’re buying, selling, or simply keeping an eye on market trends, staying informed and working with a knowledgeable professional will help you make the most of the opportunities ahead.

Here’s to a new year filled with possibilities in Ottawa’s ever-evolving real estate market!