Having been on an upward trend since early last year, average rent prices have now eclipsed pre-pandemic levels.
The average rent for all property types listed on Rentals.ca in August hit a three-year high of $1,959 per month, up 1.3% from July and 11.1% from August 2021, according to the site’s latest national rent report. Rents have now risen 16.8% since hitting a low of $1,676 in April 2021.
“…prospective tenants [are now] looking at properties that are $200 more expensive on average than a year earlier,” said Ben Myers, president of Bullpen Research & Consulting.
The average rent for single-family homes rose 13% year-over-year to $3,061, while the rents for condo apartments were up 7% in August to $2,312. Apartment rents were up 5.5% to to $1,729.
Courtesy: Rentals.ca
Market dealing with a surge in demand…and more to come
Rental demand has been rising gradually since early 2021, but saw an additional boost as home prices began to fall this spring.
In times of resale housing cooling, “demand by necessity shifts into rentals,” Myers noted in a previous report. “Throw in strong population growth, and we end up with a dramatic strengthening in the rental market in major metros.”
Given that more Bank of Canada rate hikes are still expected, which will continue to have a cooling effecting on the country’s housing market, the Rentals.ca report suggests that could drive more demand into the rental market.
“With another interest rate hike from the Bank of Canada, potential buyers are further dissuaded from buying, meaning even higher demand in a rental market already crowded from booming immigration, students returning to university, and workers moving back to city centres,” it noted.
Myers added that Rentals.ca pageviews data suggests rental demand is up by almost 40% nationally from last August, and 70% from the “locked-down August 2020 marketplace.”
A cross-country look at average rents
At a provincial level, the Atlantic provinces saw the steepest rent increases over the past year, with prices up 43.4% to $2,380 in Nova Scotia, 29.9% in Newfoundland and Labrador, and 29.4% in New Brunswick.
In terms of the highest overall rent for all property types, British Columbia once again topped the list with an average monthly rent of $2,578. That’s up 23.7% over the past year.
Next up was Ontario, with an average rent of $2,367, up 15.7% since last year. Of the provinces, Manitoba saw the smallest increase, with average rents rising 0.8% year-over-year to $1,396.
Courtesy: Rentals.ca
At the municipal level, the following are the cities that have seen the largest year-over-year rent increases (among rental and condominium apartments) so far this year:
London, ON: $1,979 (+26.5%)
Calgary, AB: $1,751 (+24.7%)
Vancouver, BC: $3,184 (+24.4%)
Toronto: $2,694 (+24.2%)
Hamilton: $1,961 (+21%)