With rates on the decline since June and markets rising from their slumbers towards the end of last year, the Ottawa CMA is emerging as one of the stand-out locales for home sales, specifically with respect to smaller (and more affordable) townhome units.
Real estate analytics firm Zonda Urban reported on Tuesday that multi-family unit sales in Canada' capital grew by 75% between 2023 and 2024, to 2,079 sales — an increase overwhelmingly driven by new townhome sales.
Of the 2,079 multi-family units sold, 1,997 of them were new townhomes, representing a 72% year-over-year increase for that home type. Additionally, around 858 new townhomes sold over the fourth quarter alone, constituting an astounding 84% annual jump.
Bringing up the rear, only 82 sales were from condominium apartments. Though this does reflect a 204% year-over-year increase, the Ottawa condo market remained "stagnant" with a standing inventory of 225 unsold and built units.
“In Toronto and Vancouver, your entry-level housing tends to be condominium apartments, but in Ottawa it's never been a huge growth node," Zonda Urban's Vice President of Market Research Pauline Lierman tells STOREYS. "As the report shows, we’ve got a lot of standing inventory because it’s just not what people are looking for in terms of space.”
As for what led the increase in townhome sales, a number of master-planned communities, including 14 townhome developments, in Ottawa’s west and southwest raked in the sales. Developments in Barrhaven and Stittsville, for example, accounted for 52% of all 2024 townhouse sales, with a further quarter of activity found in Kanata and Orleans.
Zonda Urban
These townhouses, Lierman explains, attract demand because of their location. “They’re buying in suburban growth areas, so there’s new shopping around, [the City] is in the process of opening new extensions of LRTs [...] and they’re also in areas where developers are building single-family homes as well, so they have the ability to move up without having to go too far.”
Another factor adding to the desirability of townhomes, says Paul Czan, President of the Ottawa Real Estate Board (OREB), is their affordability and positive investment qualities. "Townhome prices make them the perfect first-time buyer, entry-level type of property," Czan tells STOREYS. "If we're comparing them to a condo, the price is about 30% higher, and if the first-time buyer is looking to get into the market, a townhome is a much better value product than a condo would be for them."
One major Ottawa-area developer, Mattamy Homes, has been adjusting to meet this increased demand for townhomes in real time. "In many of our in our suburban communities, in particular developments in the South End and West End, we try to get ahead [of the demand] by going in and redlining approved subdivision work to change lot lines, change some servicing infrastructure, and introduce more townhomes to specific communities," Mattamy’s Division President in Ottawa Kevin O’Shea tells STOREYS.
In one example, the developer recently rejigged the majority of their product at a community called Oxford Village in Kemptville, just outside of Ottawa, from single-family homes to townhomes, which they'll be offering this spring and summer.
As for the 14 townhome developments highlighted in the Zonda report, an encouraging absorption rate of 67% of released units was recorded by the end of the fourth quarter, with homes selling for an average of $490,963. And overall, new Ottawa townhouses, from stacked to traditional units, sold for a similarly attainable average of $584,532 in Q4-2024.
Zonda Urban
Meanwhile, traditional 1,801-sq.-ft townhomes sold for an average $588,334 in 2024, and only two low-rise new condo units sold last year at an average of $431,293 for 727 sq. ft.
Reflecting the demand for affordable housing, more moderately-sized 1,066-sq.-ft stacked townhouses represented nearly half of new units brought to the market, with an average selling price of $387,150.
“There was a lot of townhome inventory in summer of 2023, and much of that inventory was priced over $700,000 because prices had gone up quite a bit,” says Lierman. “What ended up happening was [...] they had to rework their pricing just to get success. So we found they started to bring things down and started to come to the market with stacked townhomes, which are less expensive and slightly smaller, and that’s gotten traction because of the price point at the end of the day.”
Looking to 2025, encouraging townhome sales are expected to continue. "The townhome market is definitely seeing an uptick, and over the last several months, the inventory has been moving a lot faster," says Czan. "2025 is definitely going to be a pretty active year in that segment of market."
Mattamy's O’Shea says the Ottawa homebuilder is ready for whatever comes. "The market is going to be driven by the demand of the customers, and we're well prepared for it," he says. "We're an organization that's excited about the opportunities that lay ahead, and we've got some incredibly well-positioned locations to offer in Ottawa."
