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Affordability is on everyone's mind, as housing continues to see record-low vacancy rates. The Canadian rental market continues to slowly recover on a national basis as the average asking rents have increased month-over-month, however; interesting that the September 2021 average rent is -9.5% (less than) the same month 2 years earlier.
However; the average rent for all Canadian properties listed on Rentals.ca in September 2021 was $1,769 per month, up 0.3% over August of this year. The average rent has been slowly increasing month-over-month.
Although the average cost-per-square-foot for all rentals, all sizes seems to have stabilized to 2019 levels or lower, many urban rental rates are still out of reach for an average single income in Canada. The average rent sharply increased in 2020, with Ontario and BC still being considered unaffordable for a wide segment of the working population. Rents in Montreal and Calgary were not impacted as much as Toronto and Vancouver, with average rents per-square-foot staying relatively stable between September 2019 and September 2021.
The chart below shows the average rent and annual change in average rent for studios, one-bedroom and two-bedroom suites. Rent growth in Calgary has been strong with studio apartments increasing by 12.7%, one-bedroom apartments increasing by 5.7%, and two-bedroom apartments increasing by 7%.
In Toronto, rental rates are going down - seen by many as a correction much needed: down annually by 3.2% for studio apartments, 2.9% for one-bedroom apartments, and 1% for two-bedroom apartments. Breaking out the Toronto data by bedroom type and better controlling for changes in the composition of listings shows that rents are down slightly on average from one year ago.
In Montreal, studio apartments have experienced an annual increase of 11.8%, while one-bedroom apartments have experienced an increase of 2.0% and two-bedroom apartments have experienced an annual decrease of 0.3%.
There are outliers as well - Nova Scotia and Manitoba both experienced high levels of annual growth upwards of 10%. A trend attributed to a significant number of Ontario residents moving to more affordable regions, intending to make WFH permanent.
This trend of rentals in urban areas seeing a decline, while rentals in outlying areas seeing growth is expected to continue as companies balance WFH and return to work policies.
In conclusion, no surprise: data shows that the most expensive markets again are Vancouver and Toronto.
Source: October 2021 Rent Report: https://rentals.ca/national-rent-report
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