The average rental apartment vacancy rate in Canada's 35 major centres decreased slightly to 2.6 per cent in April 2008, from 2.8 per cent in April 2007, according to the spring Rental Market Survey released today by Canada Mortgage and Housing Corporation (CMHC).
“The Canadian economy remains very supportive of strong demand for both ownership and rental housing thanks to solid job creation and healthy income gains,” said Bob Dugan, Chief Economist at CMHC's Market Analysis Centre. “High levels of immigration and the increasing gap between the cost of home ownership and renting continue to drive rental demand in 2008. These factors have put downward pressure on vacancy rates over the past year.”
The results of CMHC’s spring survey reveal that the major centres with the lowest vacancy rates in April 2008 were Victoria (0.3 per cent), Kelowna (0.3 per cent), Greater Sudbury (0.7 per cent), Vancouver (0.9 per cent), and Saskatoon (0.9 per cent). A unit is considered vacant if, at the time of the survey, it is physically unoccupied and ready for immediate rental. In other words, a new tenant can sign a lease for a vacant unit and move in immediately. All major centres in British Columbia except for Abbotsford, posted a vacancy rate below one per cent due to rising migration to British Columbia and relatively high home ownership costs that have resulted in increased rental demand. Provincially, vacancy rates were lowest among the western provinces, especially Manitoba (1.0 per cent), Saskatchewan (1.2 per cent), and British Columbia (1.1 per cent). This is largely due to the migration of workers from Central and Atlantic Canada, who settle in rental housing upon their arrival in the western provinces. As for Alberta, both Edmonton and Calgary have seen increases in the vacancy rate, mainly due to reduced migration into the province and increased supply of non-traditional forms of rental accommodations such as rented condominiums and basement apartments.
At the other end of the spectrum, the major urban centres with the highest vacancy rates were Windsor (13.2 per cent), Moncton (5.5 per cent), and Hamilton (4.7 per cent).
The highest average monthly rents for two-bedroom apartments in Canada’s major centres were in Calgary ($1,096), Toronto ($1,075), Vancouver ($1,071), and Edmonton ($1,000). Of all the major centres, these four were the only ones with average rents at or above $1,000. The lowest average monthly rents for two-bedroom apartments were in Saguenay ($497), and Trois-Rivières ($501).
Year-over-year comparison of rents can be slightly misleading because rents in newly-built structures tend to be higher than in existing buildings. Therefore, CMHC provides an analysis of rents that excludes new structures, resulting in a better indication of actual rent increases paid by tenants. Overall, the average rent for two-bedroom apartments in existing structures across Canada’s 35 major centres increased by 3.6 per cent between April 2007 and April 2008. While the average rent for two-bedroom apartments in existing structures increased in all major centres, rent increases were particularly strong in Saskatoon (21.3 per cent), Edmonton (13.7 per cent), Regina (10.4 per cent), and Abbotsford (9.1 per cent). When these four centres are excluded, the average rent increase in existing structures in the remaining 30 centres was only 2.3 per cent.
CMHC’s spring Rental Market Survey found that the average rental apartment availability rate in Canada’s 35 major centres was 4.9 per cent in April 2008 down from 5.4 per cent in April 2007. A rental unit is considered available if the unit is vacant (physically unoccupied and ready for immediate rental), or if the existing tenant has given or received notice to move and a new tenant has not signed a lease. Availability rates were highest in Windsor (15.6 per cent), Hamilton (8.1 per cent) and Moncton (6.4 per cent), while the lowest rates were in Kelowna (1.3 per cent), Vancouver (1.3 per cent) and Winnipeg (1.5 per cent).
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