With solid economic growth, the vibrant housing market, interprovincial migration from other cities, Canadians looking for a more affordable housing option, has helped the city’s population surpass the one-million mark. With the city reaching that milestone, we expect larger investment players to come into the Ottawa market.
With the dust settled on the 2019 federal election, commercial real estate watchers are keeping a close eye on how Public Services and Procurement Canada will shape Ottawa’s commercial real estate market in 2020. There are several submarkets to watch, growing interest in Kanata and the Central Business District is driving leasing activity west.
Ottawa is also home to a number of massive infrastructure projects that will require thousands of workers to bring to fruition, resulting in billions of dollars being injected into the Ottawa’s economy over the next several years. The largest one is the next phase of Ottawa’s public transit system will see $4.6 billion spent on 24 new rail stations and 44km of track.
A total of 18,622 properties transacted throughout 2019, an increase of 6.6% vs 2018. Residential-class properties hit an average sale price of $486,590 in 2019 while condos sold at an average of $304,203, representing year-over-year price hikes of 8.9% and 9.3%, respectively.
Tenants in Ottawa paid an average of $108 a month more for an apartment in 2019 compared with a year earlier, the average rent for a two-bedrooms rental apartment in Ottawa rose 8% to $1,410 in 2019 and rent for one-bedroom units jumping by a similar percentage to an average of $1,178. Condominiums make up 24% of the overall sales, which is up from a low of 18.2% in 2015. Condo inventory and supply continues to trend lower.
Across the city there was wide variation in the residential resale market, ranging 6 from a 31.5% gain in the district that includes Country Place, Pineglen and Crestview, to an -8% drop in Bells Corners. Overall, 20 of the 46 real estate districts registered average price rises in excess of 10% with a heavy concentration in the western areas of the city. Among the geographical exceptions were Lower Town-Sandy Hill (average price of $658,200 — up 12.2%), Vanier ($472,600 — up 11.3%), Hunt Club-South Keys ($470,000 — a gain of 11.9 %) and Hunt Club-Windsor Park ($526,400, up 10.2%). Ottawa is expected to remain one of the country’s most desirable markets due to its combination of relatively affordable markets, strong local economies, an excellent pool of renters will draw investors and fewer instances of market imbalances.
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