The average rental rate in Canada consistently declined between the fall of 2019 until the start of 2021, as the typical winter slowdown in 2019 led into the start of the pandemic. The market has more or less trended upward over the past year.
Rentals.ca April 2022 Rent Report
Based on listings on Rentals.ca, the average rent for all Canadian properties in March 2022 was $1,818 per month, representing an annual increase of 6.6% from $1,706 per month experienced in March 2021. Average rents have stayed fairly flat since November of last year, as the winter is typically the slowest period for rental activity. On a monthly basis, the average rent is down $2 from February or 0.1%.
Over the past three years, average rent peaked at $1,954 per month in September 2019, bottoming out at $1,700 in April 2021.
Per-Square-Foot Rental Rates
The figure below presents the average rent per-square-foot and the month-over-month change in average rent per-square-foot for all property types across Canada between January 2019 and March 2022.
Please note that not all listings on Rentals.ca have their unit size included by the landlord or owner in the property description, and thus this data is based on a smaller sample size that tends to skew toward newer properties where unit size is more likely to be known. Given the smaller sample size, this time series tends to be more volatile on a monthly basis.
In March 2022, the average rent per-square-foot across Canada was $2.38, which represents a monthly increase of 1.6% as well as an annual increase of 3% over the March 2021 average of $2.31.
Despite some significant fluctuations, the average rent per-square-foot has not changed significantly over the past three years, moving from $2.36 in March 2019 to $2.35 in March 2020, $2.31 in March 2021, and $2.38 in March 2022.
Given that the Rentals.ca data set is asking rents, a higher share of smaller units available during the pandemic (as tenants looked for larger apartments when working from home, and when rents dropped), kept the average from dropping further, as small units tend to have higher rent per-square-foot in comparison to larger units (excluding penthouses or other premium suites).
Average Product for Rent
The figure below presents the average number of bedrooms, the average number of bathrooms, and the average unit size for all property types across Canada in Q4-2021 and Q1-2022.
The average number of bedrooms, bathrooms, and unit sizes did not change significantly quarter over quarter. Rentals.ca listings data shows single-family homes and townhouses saw their average number of bedrooms increase, moving from 3.1 to 3.2 and 2.7 to 2.8 bedrooms respectively. Similarly, rental apartments are the only property type that experienced a change in the average number of bathrooms, moving from 1.1 to 1.2 baths. The unit sizes in general also experienced a less than 3% change between Q4-2021 and Q1-2022. This suggests that the unit composition has largely remained unchanged in the last two quarters.
Median Rent by Bedroom Type
Average rental rates can often be skewed by some high-priced suites, or influenced by a change in the makeup of the sample being analyzed (by built form, tenure, unit size or location). There could be more large single-family homes for rent in one quarter, versus more small basement apartments in another quarter. So changes in the data are influenced by the change in the units examined, not changes in demand.
One way to combat this is to look at median rents.
The median rent for a studio unit in March 2022 was $1,346 per month — a month-over-month increase of 3.5%. The median rent for a one-bedroom unit was $1,581, representing a monthly decline of 0.4%. The median rent for a two-bedroom unit was $1,850 per month, which is the same as February 2022. Three-bedroom units had a median rent of $2,273 per month, representing a minimal decline of 0.1%. Four-bedroom units had a median rent of $2,899 per month, which is also the same as the previous month. Nationally, rents have been relatively flat for six months.
Provincial Rental Rates
British Columbia and Ontario remain the most expensive provinces in terms of monthly rental rates, with British Columbia averaging $2,200 per month and Ontario averaging $1,995 per month. Newfoundland and Saskatchewan are the provinces with the lowest average monthly rent at $875 per month and $976 per month respectively.
New Brunswick is the province with the highest annual change in average rent in March 2022 at 21.7%, with British Columbia a close second at 18.9 annually. Newfoundland and Manitoba are the two provinces that experienced annual declines at -2.2% and -0.8% respectively.
In the small provinces in Canada, a new building completion or other change in the composition of listings can have a big impact on rent levels, which is likely a contributing factor in the rise in rents in New Brunswick.
Provincial Rental Apartment Rates by Bedroom Type
The chart below shows the average rent and average rent per-square-foot by bedroom type for all property types in select provinces in March 2022.
Studio units and one-bedroom units in British Columbia and studio units in Ontario are among the most expensive in terms of average rent per-square-foot. Studio units in British Columbia and Ontario had an average rent per-square-foot of $3.74 and $3.72 respectively, while one-bedroom units in British Columbia had an average rent of $3.28.
Four bedroom units in Alberta and Nova Scotia are among the least expensive at $1.23 per square foot and $1.27 per square foot respectively.
Municipal Rental Rates
The chart below presents data on the average rent and the monthly change in average rent for all property types in select municipalities in Canada over the past two years.
In general, rental rates in Calgary and Edmonton did not suffer significantly during the pandemic, and have remained relatively stable heading into March 2022. The average rent in Calgary in March 2022 was $1,502 per month, while the average rent in Edmonton was $1,190 per month, both of which are higher than March 2020 at the outset of the pandemic.
Montreal has also remained relatively stable after a period of growth toward the end of 2019, landing at $1,712 per month in March 2022, still below March 2020’s $1,774 per month average rent.
Toronto was strongly impacted by the pandemic with many consecutive months of decline occurring throughout 2020 and the start of 2021. The average rent was $2,326 per month in March 2022, remaining below pre-pandemic levels.
The average rental rates in Vancouver also remained relatively constant throughout the pandemic before experiencing some significant increases in more recent months. In March 2022, the average rent in Vancouver was $2,925 per month.
The figure below presents the average monthly rental rate and the annual change in average monthly rental rate for the 20 cities with the highest number of listings on Rentals.ca across Canada in March 2022.
As previously mentioned, Vancouver has the highest average monthly rental rate at $2,925. It is also the municipality with the highest year-over-year change in average rent at just under 30%. London, Hamilton, and Toronto in Ontario have also experienced significant annual increases in average rent, increasing by 18.3%, 15.9%, and 14.3%, respectively.
Only three municipalities out of the top 20 experienced an annual decline in average monthly rent – Regina, Nepean, and Winnipeg. The average monthly rental rate in Regina experienced an annual decline of 4.7%, while Nepean experienced an annual decline of 0.2% and Winnipeg experienced an annual decline of 1.1%.
Average Rent by Postal Code in Toronto
The chart below looks at the average change in rent for condominium and rental apartments by postal code in the GTA in March 2022.
Many of the postal codes in the downtown Toronto core have experienced annual increases in average monthly rental rates. Many of the areas outside of the immediate downtown core have experienced annual declines in average rent.
Similar to the past several months, March has continued the narrative that the Canadian rental market is heading back to pre-pandemic levels.
British Columbia and Ontario continue to lead the way with the highest average rental rates in Canada, while Newfoundland and Saskatchewan are the provinces with the lowest average monthly rental rates. Studio and one-bedroom units in British Columbia and Ontario lead the country in terms of average rent per-square-foot.
After a period of steady declines, Toronto has bounced back strongly as rental rates continue to steadily rise heading into March. The average rental rate in Vancouver has risen sharply over the recent months, with rents in downtown Vancouver up by more than 30% annually.
Bullpen Research & Consulting expects the rental rates to continue to rise as the country returns to normal. However, it remains to be seen how inflation, supply chain issues, and the recent Bank of Canada rate changes will impact the economy and the rental market.
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.