Will it last? August 2025 new-home sales were strong, but it’s not necessarily clear sailing ahead.
The latest monthly report on the local new-home market prepared by industry analyst PMA Brethour Realty Group in partnership with the Greater Ottawa Home Builders’ Association showed Ottawa did well, not only beating July’s numbers but coming in 46 per cent above the five-year average.
“That’s a big jump, and it shows just how much momentum the market has as we head into fall,” says Cheryl Rice, president of PMA’s Ottawa branch.
There were 299 new-home sales in August, which is up 30 per cent compared to the 230 homes sold in August of last year. It’s also nine per cent higher than what was sold this past July (274).
“What we’re seeing is more buyers stepping back into the market, and townhomes remain the clear favourite,” Rice says. She adds that when you look at builder performance, “it’s no surprise that Minto and Mattamy (Homes) led the way. Together, they sold 150 homes. That’s half the total market. That tells you a lot about where demand is, and it really comes down to affordability. The right product at the right price is still finding buyers.”
But she also notes that there are factors her team is watching closely. “Interest rates, job growth and the broader Ontario housing picture are all going to shape how sustainable this market is.
“There are also a few wild cards. If we see job losses, a hit to consumer confidence or any external shocks, buyer demand could soften.”
And on the supply side, she says, rising construction costs — labour, materials, inflation — could push prices higher.
The good news is, she does expect to see some easing in mortgage rates, especially fixed rates, which will help affordability and keep buyers in play. (In fact, the Bank of Canada lowered its prime interest rate by 25 basis points this week to 2.5 percent — the first reduction since March.)
But Rice says so much depends on inflation, the Bank of Canada’s next moves and overall economic stability. “If any of those go sideways, we’re right back to affordability challenges.”
Not surprisingly, the most popular home choice in August was townhomes, which captured 53 per cent of the market.
For the year to date, overall new-home sales reached 2,365, up 1.6 per cent compared to last year when sales were at 2,328.
