Feeling unsure about the Canadian Housing Market? You’re not alone.
Take a deep breath.
We get it! With so much talk about interest rates, affordability, and shifting buyer behaviour, it’s no wonder buyers and sellers are left wondering what to do. Here are the top 5 trends shaping Canadian real estate right now and our tips for navigating any market!
1. The Return of the Move-Up Buyer
For the last couple of years, move-up buyers – those selling their homes to move to something bigger or better – have been sidelined by high interest rates, climbing home prices and an uncertain economy.
Now that interest rates are stabilizing and trending downward, we’re seeing more move-up buyers coming back to the market.
Homeowners who have held off listing their properties as they figured out their next move and now on the move. They’re listing their mid-range properties and looking to move to higher-end/luxury homes in highly sought-after neighbourhoods.
For Ottawa, this means we’re seeing an influx of listings in popular neighbourhoods like Barrhaven, Riverside South and Kanata, and a slow increase in buyer demand in luxury neighbourhoods like Manotick Estates. Sellers from these outer neighbourhoods are using the demand for their homes to boost their buying power and move up!
How to Navigate This Trend
If you’re a homeowner, look at the demand for your property and see if you could increase your buying power through selling now. Moving up right now is a strong move as interest rates lower and our supply and demand remain relatively stable, making this a great market for moving up.
2. The Suburb Boom Is Not Over Just Yet
We saw demand for suburbs SKYROCKET during COVID as people assumed the work from home culture would last forever. We did see demand slow slightly through 2023 and 2024 as people returned to in-person work. However, many Canadians still value the space and freedom that comes with suburban living.
The Canadian real estate market is seeing suburb demand remain steady. Particularly, in Ottawa where many highly sought-after suburbs, like Orleans and Barrhaven, are just minutes away from the Downtown Core.
How To Navigate This Trend
For anyone looking to move to the suburbs this year, know that you’re not alone and will see increased competition as we get into the Summer market and through until the end of the year. Right now is a great time to buy in the suburbs are we’re seeing a temporary influx in inventory and less activity. However, this slight lull won’t last much longer as interest rates lower and buyers become more confident.
If you’re thinking of purchasing a home in the suburbs, we think it’s time to start the hunt!
If you’re in Ottawa, reach out to our team!
3. Inventory Levels Are Slowly Rebounding
In certain areas we’re seeing increased inventory as sellers who have been holding off for the last couple of years are bringing their homes to market.
This bump in inventory may be short-lived, it does give buyers a brief window of opportunity.
We predict that things will go back to a more balanced market throughout the year and even potentially return to a seller’s market as inventory dwindles due to increased buyer demand.
How To Navigate This Trend
If you’re buying right now, you have options! That means the return of offers below listing price and with conditions. However, this period of opportunity will likely be brief as more buyers come to market increasing demand. If you’re a seller, price strategically and work with a reputable realtor who will optimize your property and your listing to sell.
4. Co-Buying Will Remain A Smart Affordability Strategy
Co-buying with siblings, friends, family, etc. has gained popularity over the last few years as housing affordability remained low. This trend is here to stay and will gain popularity this year as we see prices remain high.
How to Navigate This Trend
As with any business deal (and yes, co-buying is a business deal), you need to create a clear plan with roles, responsibilities and goals.
Before you co-buy make sure:
- you have a clear picture of their finances
- agree on a homeownership timeline
- plan for potential re-sale or refinancing
- align on lifestyle (if you plan to live together)
You need to be aligned on all of the above before legally binding yourself to another person. You should also probably discuss lifestyle and living habits if you plan to cohabitate.
5. Investment in Purpose-Built Rental Housing
Developers are still weary of building condos as demand is down and mortgage rates are still relatively high. This combined with increased rental demand and government incentives for purpose-built rentals, has created a lot of activity on the rental front.
We’re seeing more purpose-built rental developments pop up across the country. In Ottawa, we have strong rental demand that has incentivized developers to get to work.
How To Navigate This Trend
Good news, more rental units should help curb rising rental prices across the country. However, it’s likely that we will see this trend slow as mortgage rates lower and developers/investors feel stronger about the housing market.
What Do These Trends Mean for Canadian Real Estate?
Simply put, these are just TRENDS.
Every trend has its shelf life and we can expect these to shift throughout 2025 and beyond. Remember that while trends can guide us, real estate is highly localized and personal. Whether you’re thinking of buying or selling, or just staying informed, understanding what’s driving the Canadian real estate market in 2025 can help you make smart decisions.
Ottawa residents, curious what these trends mean for your situation? We’ve got you! Our team has over 15-years of experience helping buyers & sellers like you. We’re happy to chat about suburbs, listing strategies and everything in between!
Reach out to us today and we can chat through your options!
