Would-be Ottawa homebuyers remain on the sidelines following interest rate cut, Royal LePage says

A new home is displayed for sale in a housing development in Ottawa on Tuesday, July 14, 2020. (THE CANADIAN PRESS/Sean Kilpatrick)

Ottawa's real estate market is expected to remain "relatively quiet" through the summer, after the recent interest rate cut by the Bank of Canada did not send would-be homebuyers rushing back into the market, according to Royal LePage.

The Royal LePage house survey shows the aggregate price of a home in Ottawa increased 2.1 per cent in the spring to $754,700. Average home prices are expected to increase 4.5 per cent in Ottawa to $788,622 by the end of the year.

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Royal LePage says demand remains slow in Ottawa heading into the summer.

"Many would-be homebuyers continue to sit on the sidelines, an indication that the recent 25-basis point rate cut by the Bank of Canada has not convinced many purchasers to return to the market," John Rogan, broker of record with Royal LePage Performance Realty, said in a statement.

"Meanwhile, the expectation of a rate drop and a subsequent upswing in market activity, prompted many sellers to list their homes throughout the spring.  While demand has slowed, it is likely to pick up again in the fall, especially if we see further rate cuts. However, the summer months will be relatively quiet, as is typical for this time of year.”

Data released by the Ottawa Real Estate Board showed 1,439 homes were sold in June, up 0.1 per cent from June 2023.  The statistics show home sales are 7.5 per cent below the five-year average.

A total of 7,109 homes were sold in Ottawa over the first six months of the year.

Rogan says he expects the wait-and-see approach to continue, adding Ottawa's healthy job market and "ample number of dual-income households is largely preventing homeowners" from being forced to sell their home.

"Buyers are proceeding with caution and sellers are holding out for the right offer," Rogan said. "Many buyers are trying to navigate higher interest rates and the elevated costs of carrying a mortgage. Until we see a series of cuts to the overnight lending rate, I expect buyer hesitation will continue."

Across Canada, the aggregate price of a home increased 1.9 per cent year-over-year to $824,300.

"Canada’s housing market is struggling to find a consistent rhythm, as the last three months clearly demonstrated,” Phil Soper, president and CEO of, Royal LePage, said. “Nationally, home prices rose while the number of properties bought and sold sagged; an unusual dynamic. The silver lining: inventory levels in many regions have climbed materially. This is the closest we’ve been to a balanced market in several years."

Soper says the interest rate cut by the Bank of Canada "didn't substantially improve the affordability picture."

Royal LePage is forecasting the aggregate price of a home in Canada will increase nine per cent in the fourth quarter to $860,555.