The 2025 Ottawa Rental Market Outlook: Trends Every Property Owner Should Know

The Ottawa rental market has shifted over the past two years. Supply is finally increasing, vacancy is easing slightly, but rents remain high and continue to climb. For property owners, 2025 is less about explosive growth and more about protecting strong returns in a market that is still tight but slowly rebalancing.

This outlook walks through the key trends shaping the 2025 Ottawa rental market, then explains what they mean for local landlords and investors.

1. Where We Are Coming From: Ottawa’s 2024 Baseline

Recent data from CMHC and local market snapshots show that Ottawa entered 2025 with:

• Purpose-built rental vacancy around 2.2 to 2.6 percent, up from roughly 1.5 percent the year before, as new rental completions came online. CMHC Assets

• Average two bedroom rents for purpose-built rentals in Ottawa around $1,880 in 2024. Adam Mills Realty Team

• Condo rental units even tighter, with vacancy near 0.5 percent and higher average rents than traditional purpose-built rentals. Adam Mills Realty Team

A CityNews summary of CMHC data reported that Ottawa’s two bedroom average was expected to rise from $1,880 in 2024 to roughly $1,960 in 2025, even as vacancy edges up toward about 2.9 percent. CityNews Ottawa

In other words, Ottawa remains a fundamentally strong rental market. Supply is improving, but not enough to push rents down.

2. Vacancy: Slightly Higher, Still Landlord Friendly

New purpose-built rental supply has been a major theme. An Urbanation report noted that Ottawa saw rental completions climb, with thousands of new units added and vacancy in new purpose-built buildings rising to about 2.6 percent by late 2024. Urbanation

For 2025, most forecasts expect:

• Vacancy to hover around the high 2 percent range, slightly above 2024 but still well below long term averages. CityNews Ottawa

• A market that is more balanced than the ultra tight years immediately after the pandemic, but not oversupplied.

For owners, this means:

• Units that are well maintained and correctly priced should still lease relatively quickly.

• Poorly presented or over priced units will feel the impact of rising competition more than before.

3. Rent Levels and Growth: High Starting Point, Slower Climb

Across Canada, CMHC’s 2024 Rental Market Report showed that rent growth for two bedroom units slowed to around 5.4 percent in 2024 after record increases in 2023, but remained well above historical averages. CMHC Assets

In Ottawa specifically:

• Average two bedroom rents are projected to increase from $1,880 to roughly $1,960 in 2025. CityNews Ottawa

• Median asking rents for all unit types in Ottawa as of late 2025 are in the low to mid $2,000s per month according to online listing platforms, with estimates in the $2,100 to $2,400 range. Zumper - Apartments for Rent & Houses

Growth is slower than the peak years, but rents are increasing from a much higher base. For owners, this typically means:

• Strong ongoing cash flow if expenses are controlled.

• A greater premium for well located, updated, and professionally managed units, since tenants paying higher rents expect higher standards.

4. Regulation: The 2025 Rent Increase Guideline

The Ontario rent increase guideline is an important anchor for 2025 planning.

• The 2025 Ontario rent increase guideline is 2.5 percent, which is the maximum most landlords can raise rent for existing tenants without Landlord and Tenant Board approval. York Region

Landlords must:

• Wait at least 12 months between rent increases for a sitting tenant.

• Provide 90 days written notice using the prescribed form (N1). Landlord's Self Help Centre

Because market rents for new leases have moved faster than 2.5 percent in recent years, there is a growing gap between existing tenant rents and new asking rents. This makes tenant retention a double edged decision. You gain stability, but you may carry below market rent if you hold a great long term tenant.

This is an area where a professional Ottawa property manager like Stewart Property Management can help owners weigh the tradeoffs.

5. Demand Drivers: Population, Jobs, and New Housing

Ottawa’s rental demand is influenced by several medium term factors:

• Ottawa continues to grow, supported by federal employment, tech, and services. The City of Ottawa’s Official Plan update references long term population growth projections out to 2051, which will require additional housing supply to accommodate new households. Engage Ottawa

• At the national level, Canada is slowing immigration relative to the peak years, which may moderate pressure slightly, but the starting point is a very tight housing market. Reuters

• In Ottawa, new rental construction has increased, especially in purpose-built buildings, yet it has not created an oversupply. Vacancy is rising gently, not sharply. Urbanation

The result is a market where:

• Demand remains healthy, especially for well located apartments near transit, employment hubs, and universities.

• Owners of outdated or poorly located units will feel competition from new product more than premium, well managed properties will.

6. Neighbourhood and Unit Type Trends

While data sets often report Ottawa as a whole, local observations and snapshots suggest that:

• Downtown, Centretown, and inner urban areas continue to command higher rents, especially for one bedroom and two bedroom apartments. Some reports note downtown one bedroom asking rents above $2,000 per month by 2025. mattrichling.com

• Townhomes and smaller low density rentals are in demand from families and professionals who have been priced out of ownership, especially in the $500,000 to $700,000 home price band. REMAX Canada

• Purpose-built rentals and condo rentals operate almost as two sub markets, with condos often commanding higher rents but facing different maintenance and condo fee structures.

For owners, this means that a one size fits all pricing strategy rarely works. Rent levels, marketing strategies, and lease terms should be tailored to both neighbourhood and unit type.

7. What This Means for Ottawa Property Owners in 2025

Here is how property owners can position themselves for success in 2025.

Price Strategically, Not Emotionally

Use data, not gut feel. Look at:

• Comparable active listings in your specific neighbourhood.

• CMHC and listing platform data for average rents and trends. CMHC Assets

A professional manager can benchmark your property against similar units and recommend a realistic price that balances income with vacancy risk.

Get a Free Ottawa Market Rent Analysis

Focus on Presentation and Tenant Experience

As vacancy edges up slightly, tenants have more choice. Small improvements can have a big impact:

• Fresh paint, clean common areas, and updated lighting.

• Professional photos and clear, detailed listings.

• Responsive communication and maintenance once tenants move in.

These steps support both faster leasing and stronger renewal rates.

Plan Around the 2.5 Percent Guideline

Build your long term numbers around the 2025 rent increase guideline:

• Map out rent increases over the next few years for each unit.

• Decide where it makes sense to focus on tenant retention versus repositioning a unit after turnover.

Control Operating Costs

With higher interest rates and inflation in recent years, expense management matters as much as rent growth:

• Schedule preventative maintenance instead of waiting for emergencies.

• Review service contracts and insurance regularly.

• Use accurate bookkeeping and reporting to track true net income.

Consider Professional Management

In a market where regulation is strict and expectations are high, many Ottawa owners choose to work with a property management company.

A firm like Stewart Property Management can help with:

• Pricing strategy based on local data.

• Marketing, tenant screening, and lease management.

• Maintenance coordination and vendor relationships.

• Legal compliance under the Residential Tenancies Act.

• Clear financial reporting for each property.

Key Takeaways for 2025

• Ottawa’s rental market remains strong, with vacancy rising slightly but still in landlord friendly territory. CityNews Ottawa

• Average rents are high and expected to continue increasing in 2025, although at a slower pace than the peak years. CityNews Ottawa

• The 2025 Ontario rent increase guideline of 2.5 percent limits how quickly existing rents can be raised for sitting tenants. York Region

• New rental supply is coming online, which rewards owners who invest in good maintenance, presentation, and professional management. Urbanation

• Thoughtful pricing, strong tenant experience, and disciplined operations will be key to protecting and growing returns in 2025 and beyond.

Have a question? Contact us today!