Canada’s Rent Growth Slows to 2 per cent: Report

According to Rentals.ca and Urbanation’s latest National Rent Report, average asking rents for all residential property types in Canada increased by 2.1 per cent year-over-year in September, reaching an average of $2,193 per month, which marks the smallest annual rent growth since October 2021.

The annual rate of rent growth has slowed for five consecutive months, and is down significantly from a 9 per cent growth in May.

Despite the slowdown, rents remain 13.4 per cent higher than two years ago and 25.2 per cent higher than three years ago, which reflects the impact of the pandemic on housing costs. The report also noted that a slowdown in rent increases aligns with a reduction in non-permanent residents entering the country.

“Rents in Canada are increasing at their slowest pace in nearly three years, largely the result of foreign student enrollments dropping by roughly a half from their record highs, with the impact felt most in B.C. and Ontario,” said Shaun Hildebrand, president of Urbanation. “Meanwhile, smaller, more affordable markets continue to see strong upward pressure on rents as demand shifts to less expensive parts of the country.”

Rents for condominium apartments declined by 1.7 per cent annually, averaging $2,296 in September. This trend was led by major markets like Vancouver, Toronto, and Calgary. Purpose-built apartments, however, saw a 5.4 per cent annual rent increase, reaching an average of $2,138, with studio units showing the strongest growth at 11.1 per cent.

Ontario and British Columbia recorded the most significant annual rent declines, with average asking rents for purpose-built and condominium apartments down 4.3 per cent in Ontario to $2,380 and down 3.2 per cent in B.C. to $2,570. Rents surged in Saskatchewan by 23.5 per cent, making it the fastest-growing province in the country.

The report noted that among Canada’s largest cities, apartment rents declined in Vancouver, Toronto, Calgary, and Montreal. Vancouver rents fell for the tenth consecutive month, down 9.5 per cent year-over-year to an average of $3,023, while Toronto saw an 8.1 per cent decrease, bringing the average down to $2,668. Calgary and Montreal both posted 2.0 per cent annual rent declines, while Ottawa experienced a slight increase of 0.8 per cent to $2,220.

Lloydminster led rent growth with a 27.5 per cent annual increase, yet maintained its position as Canada’s most affordable city with average apartment rents of $1,178. Other affordable markets experiencing significant growth include Saskatoon and Quebec City.

Shared accommodation rents grew by 6.9 per cent annually, averaging $1,009 in September, as demand for these more affordable options continues to rise, particularly in higher-priced regions like Toronto and Vancouver.