Over Half of Ottawa Rental Buildings Offering Incentives

TORONTO – May 04, 2026:  Urbanation Inc., the leading source of information and analysis on the rental and condominium markets since 1981, released its Q1-2026 Ottawa Rental Market Survey results today.

Rental market conditions became more balanced in the nation’s capital during the first quarter. The vacancy rate in stabilized buildings completed since 2000 in Ottawa was 3.2% in Q1-2026, rising from 2.6% a year ago in Q1-2025 and nearly double the vacancy rate of 1.7% two years ago in Q1-2024. Vacancy increased in Ottawa as population inflows slowed, the job market weakened, and new rental apartment completions remained near record highs. The availability rate, which includes both vacant units and occupied units where the tenant has given notice to vacate, reached 6.5% in Q1 — the highest level since the pandemic.

The average rent for available units during Q1 in buildings completed since 2000 was $3.28 per square foot (psf), based on an average monthly rent of $2,406 and an average unit size of 734 square feet (sf). This represented a 0.6% year-over-year decline in rents.

Additionally, most rental operators in Ottawa used incentives to attract tenants. In Q1, a 57% share of projects completed since 2000 offered incentives. The most common incentive in the latest quarter was two months of free rent offered at 39% of projects, which was double the share from a year ago. A 38% share of projects offered one month of free rent, while a 19% share offered three months of free rent. Other incentives included cash move-bonuses, gift cards, free internet, and free or reduced parking and locker costs.

After accounting for the monetary value of incentives offered in the market, net rents in Q1 averaged $2.91 psf. Incentives reduced “face rents” by an average of 11% or $272 per month. 

Despite softening rents and rising vacancy, rental construction in Ottawa continued to trend higher. A total of 780 rental units started construction in Q1, up 30% from last year. The latest 12-month total for starts reached 5,082 units, representing the highest level since 2021. As of Q1, a total of 10,978 purpose-built rental units were under construction in Ottawa.

Looking ahead, a total of 4,607 new purpose-built rental units are projected to reach completion in 2026, remaining close to the multi-decade high of 4,646 units delivered in 2025. 

“The Ottawa rental market is undergoing a cyclical slowdown as supply temporarily outpaces demand. However, Ottawa’s rental market has shown more resiliency than most other major cities in Canada, supported by a diverse population and stable economy, and relatively affordable conditions”.

—Shaun Hildebrand, President of Urbanation

ABOUT THE OTTAWA RENTAL MARKET REPORT

Urbanation’s Ottawa Rental Market Report surveys every new purpose-built rental project completed since 2000 for market rents, incentives, absorption, availability and vacancy through direct cooperation with local rental operators and field research. Additionally, the report tracks lease transaction activity through the MLS system within every registered condominium building in the Ottawa CMA. The report also monitors every new rental project under construction and all apartment projects proposed for development through official application submissions.

ABOUT URBANATION

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the real estate industry since 1981. Urbanation offers subscription services and custom market studies covering the new construction condominium and purpose-built rental apartment markets in the Greater Golden Horseshoe, Ottawa-Gatineau, and Montreal regions. 

www.urbanation.ca                                                                              

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