Ottawa is putting significant skin in the game to address its deepening housing crisis, with the City of Ottawa announcing plans to waive development fees and property taxes on new affordable housing developments built on surplus federal lands.
What the City Is Offering
Under the new initiative, the City of Ottawa will forgo both development charges and municipal property taxes for affordable housing projects constructed on federal lands that have been freed up for residential use. These financial incentives are designed to make it economically viable for non-profit housing providers, co-ops, and developers to build deeply affordable units — the kind that would otherwise be financially unworkable without significant subsidies.
Development charges alone can add tens of thousands of dollars per unit to construction costs, making them a major barrier for affordable housing projects operating on tight margins. By removing that burden, the city hopes to unlock hundreds of new units that would otherwise never break ground.
Federal Lands at the Centre of the Plan
The federal government has been working to identify surplus properties across the country that could be repurposed for housing. Ottawa, as the nation's capital, sits on a large footprint of federally owned land — making it uniquely positioned to benefit from this kind of federal-municipal collaboration.
The city's willingness to waive taxes and fees is intended to complement federal efforts to transfer or lease these lands at below-market rates to housing providers. Together, the two levels of government hope to dramatically reduce the per-unit cost of building affordable homes.
Why This Matters for Ottawa Residents
Ottawa's rental market has tightened considerably over the past several years. Average rents have climbed steadily, vacancy rates remain low, and the waitlist for subsidized housing stretches years long for many families. Advocates have long argued that the city needs to do more than approve market-rate towers — it needs to actively incentivize the creation of homes that low- and moderate-income residents can actually afford.
This announcement signals a more aggressive posture from Ottawa City Hall. Rather than waiting for the private market to deliver affordable units voluntarily, the city is putting real dollars on the table — or rather, giving them up — to make it happen.
What Comes Next
City staff will work with federal partners to identify specific parcels and eligible housing providers. The waived fees and taxes would apply only to the affordable portion of any development, ensuring the incentive is targeted where it's needed most.
Housing advocates have cautiously welcomed the move, while noting that implementation details will be critical. Questions remain about how "affordable" will be defined, how long tax exemptions will last, and whether the pipeline of federal land is large enough to make a meaningful dent in the city's housing shortfall.
Still, for a city that has struggled to produce enough affordable units year after year, this kind of policy lever — using the city's own revenue as a subsidy tool — represents a meaningful shift in approach.
Source: CTV News Ottawa
