Ottawa is facing one of the most significant housing crises in its history. Between 2014 and 2024, median monthly rent surged by over 60 percent, climbing from $992 to $1,600, while household incomes rose by only 46 percent over a 15-year span. As the city’s population continues to grow and housing supply struggles to keep pace, thousands of Ottawa residents are finding themselves priced out of the market. However, city officials, developers, and housing advocates are working together on ambitious plans to address this crisis.
The State of Ottawa’s Housing Crisis
The numbers paint a stark picture of Ottawa’s housing challenges. The city’s Centralized Wait List for affordable housing has ballooned to over 15,000 households, marking a 67 percent increase since 2020, with average wait times now stretching up to 7.6 years. This dramatic increase reflects the growing gap between housing supply and demand across the nation’s capital.
Perhaps even more alarming is the homelessness situation. The 2024 Point-in-Time Count recorded 2,952 people experiencing homelessness in Ottawa, representing a 78.5 percent increase since 2018. The shelter system is operating at over 81 percent above capacity, particularly for families and single adult women, indicating that emergency systems designed for temporary stays are being used for long-term housing.
The rental market offers little relief. The rental vacancy rate sits well below the healthy threshold of 3 percent, and there are virtually no affordable units available under $775 per month. By 2035, renters are expected to make up 43 percent of all households in Ottawa, yet the city’s housing supply hasn’t kept pace with this shift.
Why Housing Supply is Struggling
Ottawa’s housing market in 2024 reached a critical juncture, with rising demand and dwindling supply creating a challenging environment for residents and developers, as soaring construction costs and high interest rates significantly slowed the pace of new housing developments, particularly in the condominium sector.
The condominium market, once a reliable source of new housing, has been hit particularly hard. Developers are proceeding cautiously, with many reporting concerns about absorption rates for new properties. Some rental developers have resorted to offering incentives like free rent for the first month to attract tenants, a clear sign of market uncertainty despite the overall housing shortage.
Ottawa received more than $37 million in provincial funding in 2023 for making strong progress on new homes, but in 2024, the city didn’t receive a penny after missing its housing target. The city’s target for 2024 was 12,583 housing starts, but developers only started construction on 7,871 homes, just 63 percent of the target. This shortfall meant Ottawa lost out on critical provincial funding through the Building Faster Fund.
Glen Gower, vice chair of Ottawa City Council’s planning and housing committee, noted that while the city has approved around 55,000 new homes for construction since January 2023, the actual pace of construction has moved slower than anticipated. The city can approve projects, but developers make the final decision about when to break ground.
The Housing Acceleration Plan: A Bold New Strategy
In response to the crisis, Ottawa unveiled a comprehensive Housing Acceleration Plan in fall 2025, following recommendations from the Housing Innovation Task Force. The plan includes 53 actions spread across five key objectives to meaningfully tackle the housing crisis, fundamentally overhauling the city’s approach to housing and using every tool within the city’s municipal power to drive transformational change.
The five main objectives are:
1. Simplify the Regulatory Environment and Expedite Approvals
The city aims to streamline local oversight and reduce delays in the development approval process. The Auditor General found that Site Plan applications take an average of 649 days to reach legal registration, and Subdivision agreements over 1,300 days, compared to legislated timelines of 90 to 120 days. Addressing these delays represents one of the greatest opportunities to build new homes faster.
2. Evolve City Culture to Be Housing Development Friendly
Ottawa plans to look at all local planning rules through a “housing lens” to ensure efficiency and greater focus on getting more homes built. This cultural shift within City Hall aims to prioritize housing construction at every decision point.
3. Be More Flexible with Fees and Charges
If Council approves, 40 percent of the actions in the Housing Acceleration Plan would be brought into effect immediately, including reducing Community Benefits charges for five years, deferring collection of Development Charges until occupancy, and allowing for reimbursement of additional fees for non-profit affordable housing projects.
Other financial measures include:
- Using pre-set building designs to allow expedited building permits
- Deferring, reducing or waiving select Cash-in-Lieu of Parkland charges for 18 months while the city reviews its policy
- Waiving planning and building permit fees for non-profit affordable housing projects
4. Better Support Affordable Housing
The city is taking proactive steps to prepare City-owned land for affordable housing projects and creating a 10-year housing roadmap. The city would increase its annual contribution from taxation for affordable housing by $1 million per year for the next six years, increasing the affordable housing annual base budget capital contribution from $9 million to $15 million by 2030.
All net proceeds from the Vacant Unit Tax will also go toward the base budget, with committed, predictable funding expected to increase from $18.9 million in 2025 to $22.4 million by the end of the decade.
5. Build More Homes Near Transit
The plan encourages new housing near public transit with options for different budgets and family sizes, promoting walkable vibrant neighborhoods. Near Cyrville Station, the Committee approved zoning for the development of two 30-storey, mixed-use buildings at the northeast corner of Ogilvie Road and Cummings Avenue, proposing more than 840 apartment units and ground-floor commercial space.
Federal Support Through the Housing Accelerator Fund
Ottawa isn’t tackling this crisis alone. The Government of Canada and the City of Ottawa reached an agreement to fast-track over 4,400 housing units over the next three years, with work expected to spur the construction of 32,600 homes over the next decade through the Housing Accelerator Fund, providing over $176.3 million to eliminate barriers to building housing faster.
The Housing Accelerator Fund is helping Ottawa implement several key initiatives, including allowing up to four units as-of-right through the comprehensive By-Law Review process, elimination or simplification of rezoning requirements to allow for low-density area intensification, and expansion of existing affordable rental programming.
Zoning By-Law Reforms: A Game-Changer for 2025-2026
One of the most significant changes on the horizon is Ottawa’s new zoning by-law, scheduled for adoption by Council in January 2026. The city’s upcoming zoning by-law reforms represent a significant step toward increasing housing density and easing the supply crisis by allowing for more flexible development options, reducing parking requirements, and promoting higher-density buildings near transit hubs.
The new zoning by-law will put into action the city’s Official Plan, which encourages more housing construction to accommodate the growing population. It will eliminate many existing barriers to development and modernize regulations to better align with current housing needs.
Progress and Challenges
Despite the ambitious plans, implementation has been challenging. From Q1 2023 to Q4 2024, Council provided approvals for more than 52,000 new homes, putting applicants in a position to build roughly one third of the homes required to meet the 2031 goal of 151,000 quality market homes.
However, there are signs of improvement. Builders in Ottawa launched 6,694 new units in the first eight months of 2025, compared with 4,374 during the same period in 2024, suggesting that the city’s efforts are beginning to have an effect.
Specific Affordable Housing Initiatives
Beyond the broader Housing Acceleration Plan, Ottawa has allocated substantial funding for specific affordable housing projects. The 2024 Affordable Housing Capital Strategy allocated more than $13.9 million in additional funding, including:
- Up to $1.36 million to Shepherds of Good Hope to support the continued development of 48 supportive housing units at 216 Murray Street
- Up to $1.65 million to Centretown Citizens of Ottawa Corporation to support the development of 10 new affordable rental units at 171 Armstrong
- Up to $3 million to Habitat for Humanity to support construction of affordable home ownership modular projects at two City-owned sites
- Up to $6 million to Ottawa Community Housing Corporation to build approximately 90 affordable rental units at 1770 Heatherington Road
The Vacant Unit Tax: Bringing Empty Homes to Market
Ottawa’s Vacant Unit Tax program, introduced to encourage property owners to make use of empty residential units, has shown promising results. In its first year, the program generated $10.3 million for City housing initiatives, with the City receiving occupancy declarations in 2023 for 99.6 percent of the 323,182 residential properties across Ottawa.
The city has approved changes to strengthen the program, including implementing a graduated VUT rate that would increase the tax rate by one percent per year for repeat vacancies, up to a maximum of five percent of the residential assessed value. This could initially generate up to $4 million in additional revenue for housing initiatives.
The Renoviction Problem
While the city works to build more housing, existing tenants face their own challenges. There has been a 545 percent increase in N13 notices (renovation evictions) in Ottawa between 2017 and 2022, according to the advocacy group ACORN Canada. These “renovictions” occur when property owners evict tenants to renovate and then increase rent significantly.
City councillor Ariel Troster has heard numerous complaints from tenants facing intimidation from landlords. With the nationwide average rent for a two-bedroom unit increasing by eight percent in 2023, while vacancy rates decreased to a record low 1.5 percent, tenants are desperate to remain in units still protected by rent control.
Market Outlook for 2025
Uncertainty will be the byword for the housing market in 2025, according to presentations at the Greater Ottawa Home Builders’ Association’s annual outlook event. Cheryl Rice, president of real estate consultancy PMA Brethour Realty, noted that potential U.S. tariffs and economic uncertainty could impact the market in unpredictable ways.
Interest rates are expected to remain between 4 and 5 percent in 2025, significantly lower than the 2023 peak, creating a more predictable environment for buyers. The stabilization of interest rates, combined with increased housing supply from newly approved developments, could help create a more balanced market with fewer bidding wars and more reasonable pricing.
The overall MLS HPI composite benchmark price was $626,200 in March 2025, a 2.2 percent rise compared to March 2024. While prices remain high, the modest increase suggests the market is stabilizing rather than experiencing the rapid appreciation seen in previous years.
Community Response and Industry Support
The Housing Acceleration Plan has received broad support from industry groups and housing advocates. The Greater Ottawa Home Builders Association called the plan a “substantial move” that could kickstart more construction. The Ottawa Real Estate Board praised the proposals as a positive step, noting that reducing bureaucratic barriers and streamlining development approvals are critical to restoring supply and affordability.
The Ottawa Board of Trade also welcomed the plan, with Board Chair Brendan McGuinty and member organizations including BOMA Ottawa, Claridge Homes, and Ottawa Community Housing contributing their expertise to shaping the reforms. The Board emphasized that affordable housing is not only an important social issue but also a critical lever for attracting and retaining talent in the nation’s capital.
What Residents Can Expect
For Ottawa residents struggling with housing costs, the coming years should bring some relief, though change won’t happen overnight. The combination of streamlined approval processes, financial incentives for developers, increased affordable housing funding, and zoning reforms should gradually increase the housing supply.
New builds approved for several large-scale developments will begin to hit the market in 2025, including new communities in Kanata, Barrhaven, and Riverside South, featuring a mix of single-family homes, townhouses, and affordable multi-unit housing options.
For renters, the slight increase in vacancy rates expected in 2025 could alleviate some pressure on rental prices, though the market will likely remain tight for the foreseeable future.
Long-Term Challenges Remain
Despite the ambitious plans and increased funding, significant challenges remain. Construction costs continue to rise, developers remain cautious about market conditions, and the approval process, while improving, still takes far longer than legislated timelines.
Ottawa’s population has grown by more than 205,000 people since 2006 and is projected to add another 118,000 households by 2035. Meeting this growth will require sustained effort and continued innovation in housing policy and construction.
The Housing Needs Assessment emphasizes that local planning decisions, informed by robust data and community consultation, are critical. The report serves not just as an alarm bell but as a blueprint for addressing one of the most pressing challenges facing Ottawa today.
The Path Forward
Ottawa’s housing crisis won’t be solved by any single policy or initiative. It requires a multi-faceted approach combining:
- Faster approval processes and reduced red tape
- Financial incentives to encourage construction during uncertain economic times
- Substantial investment in affordable housing for the city’s most vulnerable residents
- Zoning reforms that allow for greater density and diverse housing types
- Protection for existing tenants from displacement
- Collaboration between all levels of government, the private sector, and community organizations
The Housing Acceleration Plan represents the most comprehensive effort yet to address Ottawa’s housing challenges. With 40 percent of actions being implemented immediately and strong support from industry and community stakeholders, there’s reason for cautious optimism.
However, success will ultimately be measured not in approved units or policy changes, but in whether Ottawa residents can find safe, affordable housing in reasonable timeframes. The next few years will be critical in determining whether Ottawa can transform its ambitious plans into tangible improvements in housing affordability and availability.
For now, the city has set a clear direction and committed significant resources to tackling the housing crisis. Whether these efforts will be sufficient to meet the scale of the challenge remains to be seen, but Ottawa is at least moving forward with urgency and purpose.
