With first quarter numbers now crunched, the 2026 housing market forecast for Ottawa isn’t any rosier than it was at the beginning of the year, according to Canada Mortgage and Housing Corporation (CMHC). In some cases, the year now looks even tougher for the housing industry than originally expected, while homebuyers and renters could come out ahead.
CMHC real estate economist Francis Cortellino dove into the agency’s latest market analysis at a presentation April 30 for members of the Greater Ottawa Home Builders’ Association. The event included a review of the latest economic and demographic trends shaping the Ottawa region as well as looking ahead to probable trajectories in the resale, new-home and rental markets.
Cortellino’s presentation included a sketch of some key economic and demographic factors influencing the local market. They included employment figures such as the roughly 30,000 government jobs lost during the past 12 months, interest rates (he anticipates little to no increase in the Bank of Canada rate this year), ramifications of the trade war with the United States, and unknowns such as the effect of war in the Middle East on inflation.
He also highlighted the significant decline since 2024 in non-permanent immigration fueled by the federal government’s cutback on foreign students and temporary workers. While Ottawa’s economy is less dependent than some other centres on foreign students and workers, Cortellino said, “we can expect there won’t be any population growth (in non-permanent immigrants) in Ontario this year, and next year it’s probably going to be quite small.”
It adds up to a lot of uncertainty, as Cortellino and others have noted, and uncertainty makes us cautious about major expenditures.
Resale market
On the resale front, he walked his audience of local housing industry representatives through transactions over the past decade. Exploding during the pandemic when fear-of-missing-out ran rampant, sales have fallen to roughly 2015 levels, when 11,000 homes changed hands.
While Cortellino said sales this year should hit between 11,300 and 13,500, he noted a slowdown during the past few months, adding that “we’ll see if the next few months will be better, but for the moment we’re heading for a decrease in sales in Ottawa and the lower range forecasted here.”
MORE: Resales continue sluggish in Ottawa
The average price of a resale home this year should hover between $708,000 and $740,000, a change over last year of zero and four per cent, respectively.
On the plus side, Cortellino noted the market has remained balanced since 2024, meaning neither buyers nor sellers have an advantage and that prices are unlikely to spiral higher.
New-home market
Focusing on housing starts, an indicator CMHC has traditionally tracked as a measure of market trends, he forecasted 7,700 to 9,500 starts this year. That’s down from more than 11,000 annually during the pandemic and 10,900 last year, which saw a huge rebound after the post-pandemic slump.
Unsurprisingly, townhomes, which hold the price advantage over detached homes, have seen an increase in starts while single-family home starts have declined.
He predicted that townhomes punching above their weight in the marketplace will continue this year, but noted that since the recent GST/HST rebates on new-build homes came into effect, “when we talk to builders, they say there’s been way more transaction contracts being signed for new single-family homes. So, when we do our forecast update for the summer, we’re going to look at how those new policies could change the forecast we made at the beginning of this year.”
Rental market
While condo construction and sales have tumbled over the past decade, purpose-built rental apartment projects have soared in Ottawa as homeownership has become increasingly unaffordable.
At the end of 2025, there were 11,500 apartment units under construction, a record-setting number and a gargantuan leap from 200 in 2010.
However, what goes up also comes down. The abundant supply of units, the plunge in non-permanent immigrants (who typically rent rather than own), and the unaffordability of even renting for many young people mean a softening rental market, Cortellino said.
Incentives like high-end amenities and reduced rent rates to attract and retain tenants are evidence that the rental market is already feeling the pinch, according to Cortellino and others.
Those 11,500 units now under construction mean “a lot of supply coming on the market in next two years at a time when rental demand will be weaker… We expect vacancy rates to increase in 2026 and 2027 and rental rates to decelerate in those two years.”
The CMHC/GOHBA event concluded with a presentation by CMHC’s Walid Debbakh on the agency’s financial incentive programs — Eco Improvement and Eco Plus — to encourage energy efficiency in both the resale and new-build markets.
