Rent Prices Across Canada Heading in Different Directions

According to the latest National Rent report from Rentals.ca and Urbanation, rental rates fell in August in some of Canada’s largest, most expensive, and most popular markets with immigrants and international students, maintaining a months-long trend.

At the same time, rent prices increased in popular mid-sized cities nationwide.

The new report shows that the average Vancouver rental rate was down six percent from last year to $3,116 for the ninth straight month of declines.

Toronto's rent dropped seven percent to $2,697, marking the seventh month of decline.

Rents also fell slightly in Montreal, Ottawa and Ottawa.

 

 

Calgary, a red-hot destination for newcomers to Canada and interprovincial migrants,  saw rents decline for the first time since February 2021.

However, while rents fell in widespread immigration "Gateway" cities such as Toronto and Vancouver, many mid-sized cities experienced double-digit increases. 

Asking rents are down overall

For example, Regina, which has some of the cheapest rents in Canada, saw a 22 percent hike to $1,418.

These mid-sized city rent price hikes across the country mean that all provinces except for Ontario and British Columbia had rising rates.

Rent increases in the mid-sized markets trumped decreases in rent prices in Canada's largest rental markets. So, asking rents overall in August were up 3.3 percent from last year to $2,187.

 

 

According to the Rentals.ca report, the increase in August marked the slowest annual pace in almost three years. For example, rent growth in June, year over year, was seven percent, while in May, it was 9.3 percent. 

“The moderation in rent increases can be attributed to apartment completions this year reaching their highest total in decades, as well as a recent slowdown in population growth and a softening labour market.”

Rent prices have risen since the pandemic

Canada's average rental price is also slightly lower than in July when it reached $2,201. However, rates have recently changed very little month-to-month.

During the COVID-19 pandemic, rates in Canada averaged below $1,700. Before the pandemic, rates were below $1,900.

 

 

Immigration continues to have an impact on the rental market. 

In August, Canada welcomed 96,000 new immigrants. The country is on track to reach or exceed its 2024 goal of 450,000 newcomers and still has a target of 500,000 newcomers for 2025.

However, the government has taken steps to curtail the number of non-permanent newcomers. It has capped international student enrolments and introduced measures to limit the number of temporary foreign workers. 

Vacancy rates remain historically low

The federal government, working with provincial and local governments, has implemented plans to increase Canada's supply of rental housing, but these goals will take years to achieve.

Meanwhile, the vacancy rate in many Canadian cities hovers around one percent (three percent is considered a healthy vacancy rate).

 

Here are some highlights from the Rentals.ca report:

 

• In August, asking rents for all residential property types in Canada averaged $2,187, increasing by 3.3 percent over the past year.
• Nationally, rent prices grew at their slowest year-over-year rate in 34 months.
• After achieving a record high of $2,202 in May 2024, average asking rents in Canada have fallen by 0.7 percent. The report notes that summer rent price decreases are historically irregular.
• The slowdown in rent increases is due to significant apartment completions this year, a slowdown in population growth, and a softening labour market (unemployment in Canada is now 6.8 percent).

 

• The average asking rent for apartments in B.C. fell  5.2 percent year-over-year to $2,536 and dropped 4.3 percent in Ontario to $2,390. In August, Quebec saw an annual rent increase of only 1.6 percent.
• According to the report, rent inflation remained strong across the rest of the country.
• Edmonton was the only city among the country's six largest markets to experience annual rent growth in August. In Alberta's second-largest city, apartment rents rose 9.2 percent to an average of $1,579.

 

 

• Apartment asking rents in Toronto fell 6.9 percent year-over-year, the most significant decrease among Canada’s largest markets. Rents for apartments in Canada's largest city have fallen steadily year-over-year for seven months to a two-year low of $2,697.
• In Vancouver, asking rents for August fell year-over-year for the ninth month, with a 6.0 percent decline. However, apartment rent prices began to rise again month over month, hitting a nine-month high of $3,116.

 

• Rent prices in Calgary, which saw double-digit growth at the beginning of 2024, saw asking rents for apartments fall for the time since February 2021, dropping 1.1 percent from August 2023 to an average of $2,046.
• Roommate rents in Ontario, BC, Quebec, and Alberta rose 8 percent from August 2023 to a record high of $1,011. In BC and Ontario, the asking averages for shared units were $1,211 and $1,106, respectively.

 

RELATED STORY: Sharing Accommodation in Canada as a Newcomer

 

• According to the report, average roommate rents in Toronto and Vancouver fell year-over-year to $1,234 and $1,481, respectively. All other major Canadian markets saw average asking rents for shared accommodations increase compared to August 2023 ($928 in Calgary, $778 in Edmonton, $944 in Ottawa, and $950 in Montreal).

 

New Period of Rental Demand in Canada

 

As for what lies ahead for newcomers to Canada and international students looking for a rental home, David Aizikov of Rentsync says that "the long-term dynamics of the Canadian rental landscape are shifting as we enter a new period of Canadian rental demand.

Writing in Rentsync Monthly Demand Report, Aizikov says the reduction in the number of international students and Canadian immigration overall has lessened rental demand by newcomers looking for their first home in Canada. 

Also, due to continuing high interest rates, current renters who might want to buy a home are staying put while waiting for more interest rate cuts.

"As we move into the fall and winter months, the Canadian rental landscape is likely to remain a renters market," says Aizikov, with increased competition among landlords. He expects active renters, such as immigrants and international students, will be more selective while landlords search for new ways to appeal to them. 

In other words, good news for newcomer renters. 

Rental Action Plan for Newcomers:

• Follow Rentals for Newcomers for the latest rental trends in Canada.
• Be sure to do your research BEFORE arriving in Canada.
• Consider using a real estate agent to help you find a rental.
• Look for landlords and property owners offering incentives.
• Investigate the benefits of becoming a housemate in a home-sharing program.

RELATED STORY: Housing Newsletter for Newcomers and International Students

SOURCES: Canadian Press, Rentals.ca, Rentsync

 

If you have a question, please email us at rentals@prepareforcanada.com

Steve Tustin is the Editor for Rentals for Newcomers and a contributing editor for Prepare for Canada. He is also the former managing editor of Storeys.com and a former senior editor at the Globe and Mail and the Toronto Star.

*No AI-generated content was used in the writing of this story, and all sources are cited and credited where possible.

© Rentals for Newcomers 2024