After easing over the winter months, rent prices are back on the rise across Canada.
The average rent for all available property listings rose to $2,004 in April, according to Rentals.ca’s latest rent report. This is the first month-over-month rent increase since November. Rents are now up 10.8% compared to April 2022, and up 1% in the past month alone.
Meanwhile, the average rent in the Greater Toronto Area in the first quarter was up 13.8% year-over-year to $3,002.
“The GTA rental market remained substantially under-supplied during the first quarter of 2023,” said Shaun Hildebrand, president of Toronto real estate research firm Urbanation, a real estate research firm.
“Even though supply is set to increase in the near-term, it is expected to be short-lived and insufficient to offset demand,” he added. “The fact that rental construction has dropped by over 60% in the last year despite rents having risen to over $3,000 is indicative of the economic challenges developers are facing.”
The vacancy rate for purpose-built rental buildings completed in the GTA since 2005 was 1.8% as of the first quarter, Urbanation reported. That’s up just slightly from 1.6% a year ago.
In its Q1 rental market report, Urbanation said the GTA rental market has tightened due to “record high population inflows, low homeownership affordability, and a strong labour market all contributing to an increase in demand while supply has remained low.”
Expected increase in rental completions
Looking at projected occupancy dates, Urbanation said it expects purpose-built rental completions to increase “significantly” in 2023 to 7,520 units. That would be a 174% increase over the 2,747 completions in 2022 and nearly 300% above the 10-year average.
“However, the increase in supply is expected to be temporary, as construction starts totaling 2,997 units over the last four quarters represented a 62% decline over the four-quarter total of 7,863 starts in the period ending Q1-2022,” the report noted.
Nova Scotia leads the provinces in year-over-year increases
Average asking rents were up sharply in most provinces, but nowhere more than Nova Scotia, where the average rent jumped by 20.8% year-over-year to $2,167.
Ontario saw the second-fastest annual growth with rents up over 17% to reach an average monthly price of $2,401.
At the municipal level, Calgary led rent price growth, with an annual rise of 24.9% to $1,890. Toronto wasn’t far behind, where rents were up 22.4% to an average of $2,818.
Here’s a look at the year-over-year rent increases in some of the country’s key markets:
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- Calgary, AB: +24.9% ($1,890)
- Toronto, ON: +22.4% ($2,818)
- Halifax, NS: +20.1% ($2,215)
- Vancouver, B.C.: +18.7% ($3,146)
- Ottawa, ON: +15.4% ($2,090)
- Winnipeg, MB: +13.6% ($1,478)
- Montreal, QC: +10.9% ($1,876)
