Canadian Rent Growth Shows Signs of Moderation Amidst Shift in Market Dynamics: Report

According to Rentals.ca and Urbanation’s latest National Rent Report, average asking rents for all property types in Canada increased 8.8 per cent in March, reaching $2,181.

The report noted that this indicates some moderation from the 10.5 per cent annual increase recorded in February. Rents saw a 0.6 per cent month-over-month decrease in March, which can be partly attributed to seasonal factors as well as a recent slowdown in rental demand in Canada’s most expensive markets, according to the report.

Since March 2020, average asking rents in Canada have risen by a total of 21 per cent, which is equivalent to an average annual increase of just over 5 per cent during the latest four-year period, the report noted.

“The March data showed early signs of rent increases easing at the national level, weighed down by recent declines in key markets in Vancouver and Toronto,” said Shaun Hildebrand, president of Urbanation. “As population growth slows with caps on non-permanent residents and supply increases as rental completions continue to rise, rent growth should continue to moderate towards more sustainable levels.”

According to the report, purpose-built rental apartments saw a 12.7 per cent year-over-year increase, averaging $2,117 in March. Condominium rental apartments, however, experienced a slower growth rate, with a 3.9 per cent annual increase, reaching an average of $2,321.

The report noted that regional disparities in rent trends were notable in March. According to the report, while British Columbia and Ontario saw  declines in average asking rents, Alberta maintained its position as the province with the fastest-growing rents, experiencing an 18.3 per cent annual increase.

Edmonton showed the strongest rent growth amongst Canada’s largest cities once again, however asking rents for apartments were 27 per cent lower than in Calgary, according to the report. Vancouver in particular saw rents fall below $3,000 for the first time since July 2022.

Saskatchewan is emerging as a close contender for rent growth leadership, with average asking rents for apartments rising by 18.2% annually. Despite this growth, rents in Saskatchewan remain the lowest in Canada, averaging $1,297 in March.

The report noted that in smaller markets, the fastest-rising apartment rents over the past year continued to be led by Pointe-Claire in Quebec and Lloydminster in Alberta. Asking rents for shared accommodations continued to rise, with the average remaining above $1,000 for the fourth consecutive month.