This report is part of PERSPECTIVES, a comprehensive look into the world of prime residential real estate. Access the full report here to discover the latest trends and dynamics shaping the market.
Ottawa is having a moment. The Canadian capital, known for its green spaces and laid-back pace, is experiencing an evolution from a government-centric town to a burgeoning tech hub.
The city has embraced a new identity as “Silicon Valley North,” says Marnie Bennett, CEO and founder of Bennett Property Shop Realty. “We’ve become a tech powerhouse. Ottawa has the second-highest concentration of scientists and engineers in all of North America.”
The influx of tech companies, startups and skilled professionals to Ottawa has fueled economic growth, resulting in increased wealth and a surge in luxury real estate transactions, including homes priced at more than a million dollars.
The shift has also given rise to a new market, exemplified by the emergence of uber-luxury services, marking Ottawa’s progression toward a diversified and affluent urban landscape.
1148 Mill Ridge Road, Arnprior, Ontario. Presented by Bennett Property Shop Realty
The impact: Sales of luxury homes that exceed CAD 1 million have jumped 398% in the last five years (CAD $1 is about US 75 cents).
“We didn’t really have a $1-million-plus [Canadian] market before,” Bennett says. “It was nonexistent.” There were 14 sales of more than CAD 3 million in 2023, and the median price of those was CAD 3.495 million. Of the 22 homes recently listed in that range, the median asking price was CAD 3.64 million.
Then there are the showstoppers. The most expensive sale in 2023 was a two-story, 14,000-square-foot home with landscaped gardens in Rockcliffe Park, near the city center. It sold for CAD 6.3 million.
All this goes to show that Ottawa’s luxury market held up last year. Buyers—including tech workers, diplomats, lobbyists, Millennials looking to move from larger urban cores and even pro athletes—typically come from the United Kingdom, Spain and Germany as well as Dubai, the capital of the United Arab Emirates, Bennett says.
“We’re extremely optimistic about 2024,” she says, noting that sales in the last quarter of 2023 outpaced the same time period in 2022. “Historically, we’re very resilient.”
The influx of shoppers seeking premium properties has changed buying trends.
Years ago the demand was for new homes; now people are willing to buy houses that are 10 years old or more in sought-after neighborhoods.
49 Rebecca Crescent, Ottawa. Presented by Bennett Property Shop Realty
Ottawa, a city of just 1.4 million residents, ranks high for quality of life. It’s among the safest cities in North America, Bennett says. The picturesque Rideau Canal runs through the city and is popular with buyers who want to purchase waterfront properties.
The canal and nearby Rideau Lakes attracted lots of buyer interest in 2021, leading to an average 88% jump in prices. “We thought that would subside, but we found that [waterfront properties] remained a dominant feature,” Bennett says.
Last year a law that barred non-Canadians from buying property went into effect throughout the country. The law, which was recently extended to 2027, was meant to make housing more affordable for Canadians. Bennett believes the law really hasn’t impacted the luxury market because of numerous exemptions. The strength of luxury prices is further bolstered by the country’s largest-ever transfer of generational wealth.
By 2026, it is projected that the largest transfer of generational wealth, estimated to be $1 trillion from Baby Boomers to Millennials, will result in the reshaping of the real estate landscape.
Bennett calls it the “Bank of Mom and Dad.” With many Baby Boomers embracing the concept of “giving while living,” Millennials are becoming the recipients of substantial financial support. This trend is influencing a shift in home-buying patterns as younger individuals are now in a position to invest in multimillion-dollar homes sooner in their lives.
Looking ahead, Bennett expects the city’s tech hub status to draw more wealthy Millennials to the area, transforming the consumer scene, while the generational wealth transfer will continue to boost spending, driving Ottawa’s future growth.
