Saturday, June 25, 2022
HomeCANADAAverage Rent For All Canadian Properties Listed On Rentals.ca Was $1,888 Per...

Average Rent For All Canadian Properties Listed On Rentals.ca Was $1,888 Per Month In May 2022; Up 3.7% From April

The average rent for all Canadian properties listed on Rentals.ca was $1,888 per month in May 2022, which represents a year-over-year increase of 10.5%. This also represents a month-over-month increase of 3.7%, the largest monthly increase since May of 2019. The data includes single-detached, semi-detached, townhouse, condominium apartments and rental apartments.

Rentals.ca Rent Report Graphic - June 2022

National Overview

Rents continue to rise as the market moves back toward the pre-pandemic highs of 2019.Fig 1 Rents D

Average Rent by Property Type and Month

The chart below shows the average rent by property type in Canada from January 2019 to May 2022.

Townhouses and basement apartments have been excluded due to the significantly smaller sample sizes, which leads to significantly higher monthly volatility.

The most expensive units are single-family homes, with landlords asking $2,881 per month on average in May 2022, compared to $2,311 per month for condominium apartments, and $1,696 per month for rental apartments. Rental apartments typically account for about 55% of listings on Rentals.ca, while condo apartments for lease make up about 25%, suggesting that rental apartments best represent the overall conditions in the domestic rental market.Fig 2 Rents D (2)

Single-family homes (single-detached and semi-detached) experienced an annual increase in average rent between May 2021 and May 2022, rising by 10.4% annually.

Condo apartments experienced the biggest increase, rising by 14.2% annually.

Rental apartments, on the other hand, have not experienced the same level of price growth when compared to single-family homes and condo apartments. Rental apartments have seen their average rental rates increase by 6% annually. It is also important to note that rental apartments did not experience the same levels of declines during the pandemic.

Annual Rent Growth by Property Type

The growth rates quoted above were based on May over May, while the annual growth rates below are based on quarterly aggregations.FIg 3 Annual Change

Single-family homes have seen their average rent increase by 11.1% annually in Q2-2022 (April and May only for the second quarter of this year), while condo apartments experienced average rent growth by 12.7% annually. Rental apartments, as previously mentioned, have only seen more modest rent inflation of (4.9% annually in Q2-2022).

Average rents for single-family homes have increased for five consecutive quarters. In Q3-2020, rental rates for singles fell by nearly 15%, however rents grew by nearly 16% in Q1-2022.

Nationally, condo rents fell significantly, with Q1-2021 down by nearly 18%. Growth has been strong this year at 13.7% in Q1-2022.

Average Rent by Bedroom Type

The figure below presents the average rent and the monthly change in average rent for all property types in Canada by bedroom type for April and May of 2021 and 2022.Fig 3 Bed Type

In May 2022, four of the five bedroom types experienced month-over-month increases in average rental rates, ranging from an increase of 2.2% for one-bedroom units up to an increase of 5.5% for four-bedroom units. Rental rates for five-bedroom units declined by 4.1% annually. But this bedroom type is primarily larger single-family homes and is a smaller sample size with a wide range of products from a 1,600-square-foot bungalow on a tiny lot in a suburban setting to a 3,000-square-foot home on an oversized lot in an urban setting, which leads to significant rent volatility on a monthly basis.

In terms of rent changes year over year, three-bedroom units experience the largest annual increase in average rent, increasing 9.5% from $2,200 per month in May 2021 to $2,409 per month in May 2022.

Municipal Rental Rates

The figure below presents the average rent, average rent per-square-foot, average unit size, and the rank of average number of Rentals.ca pageviews for all property types in select municipalities across Canada between January 2022 and May 2022. Note that the rank is from highest to lowest average rent for these 20 municipalities and former municipalities. The rent per-square-foot is a straight average, not a weighted average.Fig 4 Muni summary

In terms of average rent in 2022, Regina has the lowest average monthly rental rate at $1,038 per month, while Vancouver is the municipality with the highest average monthly rental rate at $2,909 per month. Richmond Hill and Toronto (old Toronto, using pre-amalgamation boundaries) also stand out as municipalities with high monthly rental rates at $2,645 per month and $2,365 per month respectively. In Richmond Hill, a significant portion of the sample is townhouses and single-family homes for rent, so rent is higher based on a large average unit size.

Edmonton has the lowest average rent per-square-foot at $1.52, while Vancouver has the highest at $3.74 per square foot.

Toronto had the lowest average unit size out of the selected municipalities with an average of 727 square feet, while Richmond Hill had the highest average unit size at 1,757 square feet. Note that landlords/owners do not list the square footage on every listing, so the sizes skew toward newer properties, and thus skew smaller than their actual size as unit sizes in new projects tend to be smaller.

Rentals.ca tracks the number of pageviews per property and that data can be aggregated at the municipal level. The chart above ranks the average number of pageviews per listing from highest (1) to lowest (20). Edmonton is the least popular municipality in terms of average pageviews, while Vancouver was the most popular. Toronto was not in the top five, which was rounded out by London, Kitchener, Ottawa and Hamilton.

Average Rent by Property Type

The figure below presents the average rent in select municipalities by property type between January 2022 and May 2022.FIg 5 Munis 2

Across all property types, Vancouver had the highest average monthly rental rate through the first five months of this year.

Winnipeg averaged $1,780 per month for single-family homes, while Vancouver averaged $4,494 per month.

Edmonton had the lowest average monthly rental rate for condo apartments at $1,357 per month, while Vancouver averaged $3,188 per month.

Regina had the lowest average monthly rental rate for rental apartments at $993 per month, while Vancouver averaged $2,661 per month.

Saskatoon had the lowest average monthly rental rate for basement apartments at $1,096 per month, while Vancouver averaged $2,115 per month.

Average Rent and Annual Growth for Condo and Rental Apartments by Area

The chart below looks at the average rent for condominium and rental apartments in select municipalities (and former municipality in the case of Toronto), in May of 2022 versus May of 2021 and May of 2020. The annual change in average rent is also shown.Fig 6 May 2022 Rents

The average rent for condo and rental apartments in Vancouver in May of 2022 was $2,850 per month, an increase of 23% annually. Vancouver rents were down 5% annually one year ago, but up 6% in May of 2020 in the early months of the pandemic.

Toronto rents were up 19% to $2,418 per month in May of 2022, following a decline of 11% annually in May 2021 and 6% annually in May 2020.

Kitchener and London continue to see huge rent growth with increases in May 2022 of 26% and 25% year over year in their average apartment rents (condo and rental), respectively. Both of these markets increased in both 2021 and 2020, during the worst of the pandemic, likely benefitting from graduating students staying in the area instead of moving elsewhere for their first jobs, and residents moving to those less expensive markets from more expensive GTA municipalities in the new work-from-home environment.

Average Rent and Average Rent Per-Square-Foot in Toronto

The following figure presents the average rent and average rent per-square-foot for all property types in Toronto (former municipality) and several nearby municipalities between May 2021 and May 2022.Fig 7 GTA munis

In Toronto, the average rent hit $2,474 per month in May 2022 — an annual increase of 20%. Etobicoke, Mississauga, and North York all experienced similar levels of growth (14% to 17%). Scarborough stands out as the municipality that has remained relatively flat, increasing only 3% annually.

The average rent per-square-foot has also increased significantly in Toronto, moving from $3.12 to $3.58, an annual increase of 15%. North York experienced an annual increase of 13% to $2.78 per square foot, while Etobicoke, Mississauga, and Scarborough all experienced annual increases of less than 10%.

Average Rent and Average Rent Per-Square-Foot in Vancouver

The figure below presents the average rent and average rent per-square-foot for all property types in Vancouver and several nearby municipalities between May 2021 and May 2022.Fig 8 Vancouver

Both Vancouver and North Vancouver experienced notable levels of price growth, as rents increased by over 30% annually. Units in Vancouver had an average monthly rental rate of $3,095, while units in North Vancouver averaged $2,946 per month. Burnaby, New Westminster, and Richmond experienced smaller levels of growth, ranging from 13% in New Westminster to 26% in Burnaby.

In terms of average rent per-square-foot, Vancouver and North Vancouver had remained as the most expensive municipalities at $3.87 and $3.62 respectively. New Westminstser, however, has experienced significant price growth between May 2021 and May 2022 to land at $3.55 per square foot (an annual increase of 36% — however, this likely has to do with a change in the composition of listings year over year). Richmond has also experienced a significant annual increase of 26% to land at $3.17 per square foot.

Average Rent and Average Rent Per-Square-Foot in Alberta Municipalities

The figure below presents the average rent and average rent per-square-foot for all property types for select municipalities in Alberta between May 2021 and May 2022.Fig 9 ALberta

The average rent in Calgary was $1,661 per month in May 2022, representing an annual increase of 21%. Growth in the other municipalities was much more modest, with Edmonton at 7%, and Grand Prairie experiencing no change.

Calgary maintains a significantly higher average price per-square-foot at $2.22 in May 2022, which represents an annual increase of 18%. Rent per-square-foot in the other four municipalities was relatively flat year over year.

Conclusion

After a couple of months of stagnation in the market following a rapid rise in rates in the second half of last year, the Canadian rental market experienced the largest monthly increase in average rents since 2019. The average rental rate grew by 3.7% from April 2022 to May 2022 to $1,888 per month.

Demand for larger units was a noticeable trend during the pandemic with more people needing to work from home, and parents needing more space for children at home full time. This trend has not dissipated in the post-vaccine and return-to-work era. Many employers are having their employees only come to the office for one or two days a week. Couple this with sharp increases in interest rates, which has dissuaded some tenants from purchasing property, and the demand for generously sized suites has been strong. The average monthly rental rate for single-family homes continues to rise, moving from $2,609 in May 2021 to $2,881 in May 2022, a rise of 10% annually, and slightly above the market peak in 2019. Anecdotal evidence shows bidding wars, and tenants renting homes sight unseen.

Many of Canada’s major markets experienced substantial rent growth with condo and rental apartments in Vancouver up 23% annually, and Toronto up 19%. Other smaller municipalities have seen even higher rent inflation with Kitchener at 26%, London at 25%, and Calgary at 20%.

Uncertainty in the ownership housing market, and the delay in delivering new supply due to supply-chain delays and labour stoppages should continue to put upward pressure on rents into the fall of this year in the face of increased demand.

Rentals.ca Data

The data used in this analysis is based on monthly listings from Rentals.ca. The data is much different than the more familiar numbers collected and published by Canada Mortgage Housing Corporation (CMHC).

Rentals.ca data includes basement apartments, rental apartments, condominium apartments, townhouses, semi-detached houses and single-detached houses, where CMHC’s primary rental data only includes rental apartments and rental townhouses. CMHC collects some data on the secondary market, but it is reported separately.

The CMHC rental rates are based on the entire universe of purpose-built rental units in Canada (the stock), while Rentals.ca data is primarily based on the asking rents of vacated units only (the flow) — this is a smaller sample size, but more representative of the actual market rent a prospective tenant encounters. The Rentals.ca data set typically produces much higher rental rates in comparison to CMHC, as vacated units are not subject to rent control.

The average and median rental rates via Rentals.ca can also skew higher than CMHC’s data for several reasons: The inclusion of larger and more expensive unit types like singles, row units and condos; the survivorship bias (overpriced units remain in the sample longer); and the multiple listings of the same property at different rent levels every month.

It should also be noted that properties listed for above $5,000 a month and below $500 a month are eliminated from the sample of units analyzed. Also, short-term leases, single-room rentals, and furnished rental units are eliminated from the sample where identifiable.

RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -
Google search engine

Most Popular

Recent Comments

Facebook
Twitter
YouTube
Instagram
WhatsApp