The average asking rent in Canada reached another record high of $2,078 in July. Rents increased 8.9% annually, the fastest pace of growth of the past three months. The 1.8% increase in average asking rents over June represented the fastest month-over-month growth of the past eight months.
1. National Overview
Average Rents in Canada Reach Another Record High in July
Compared to two years ago in July 2021, average asking rents in Canada have risen by 21%, or by $354 per month.
Rents experienced further upward pressure last month as post-secondary students rushed to sign leases ahead of the fall term, the population grew by a record level, and homebuyers moved to the sidelines as the Bank of Canada raised interest rates to a 22-year high.
Average Rents for Apartments Surpass $2,000 for First Time
Average asking rents for purpose-built and condominium apartments rose above $2,000 for the first time in July, reaching $2,008. Annual growth for purpose-built and condominium rents accelerated back into the double-digits with an 11.3% year-over-year increase. Month-over-month, asking rents were up 2%. Rent growth for purpose-built and condominium rentals was strongest for one-bedroom apartments in July, which posted an annual increase of 13% and a monthly increase of 2.5%. One-bedroom rents averaged $1,850, compared to $2,191 for two-bedroom units and $2,413 for three-bedroom units. The least expensive units were represented by studios, averaging rents of $1,445.
2. Provincial Overview
Rent Growth Accelerating Quickly in Quebec
Alberta was the provincial leader for annual rent growth for purpose-built and condominium apartments for the third consecutive month in July, with average asking rents up 15.6% year-over-year to $1,578. Annual rent growth in Alberta moderated from its 18.3% annual pace in June. For the second straight month, Quebec had the second highest annual rent growth in Canada at 13.7%, accelerating from its 11.6% growth rate recorded in June with average asking rents reaching $1,920 in July.
Ontario’s annual rent growth of 9% in July for purpose-built and condominium apartments moderated from its 9.3% annual pace in June, trailing behind the national average. Ontario average asking rents were second highest in Canada at $2,432, behind B.C.’s average asking rent of $2,622 in July. B.C. recorded the fastest month-over-month increase in rents of 2.8%, while Manitoba experienced a 3.2% month-over-month decline in rents. Saskatchewan also recorded a slight monthly decline in rents of 0.7%.
3. Municipal Overview
Calgary and Montreal Lead Rent Growth Among Canada’s Largest Markets
Calgary maintained the top spot for fastest rent growth among Canada’s largest markets with average asking rents up 16.1% annually to $2,036 for purpose-built and condominium apartments. Annual rent growth in Calgary moderated from its 18.4% pace in June. Meanwhile, annual rent growth in Montreal accelerated from 11.2% in June to 15.3% in July, reaching an average of $1,987. The rest of Canada’s largest markets experienced a slower rate of annual rent growth in July compared to June, with Toronto moving from second spot to fifth spot with average asking rents up 11.5% in July (compared to 15.7% in June) to $2,849. Vancouver rents were the highest among Canada’s largest markets at an average of $3,340, up 12.2% annually and 2.9% monthly.
Greater Montreal Markets Move into Top 5 for Fastest Rising Rents
In July, four out of the top five mid-sized markets for highest average asking rents in Canada were in B.C., including North Vancouver ($3,556), Richmond ($3,119), Burnaby ($3,002), and Coquitlam ($2,811). In third place, average asking rents for purpose-built and condominiums reached $3,114 in Oakville, posting the fastest annual growth rate in the country at 32.1% in July. The remaining top 10 mid-sized markets for highest rents were located in Ontario, including Mississauga ($2,640), Kanata ($2,632), Brampton ($2,623), Burlington ($2,612), and North York ($2,604).
Two out of the top five fastest rising mid-sized rental markets were located in Greater Montreal, including Laval (+28.5% to $2,011) and Cote Saint-Luc (+23% to $2,306). In B.C., Richmond and New Westminster had the fastest annual growth for purpose-built and condominium rents at 27% and 20.7%, respectively. Greater Toronto markets of Brampton and Scarborough continued to lead rent growth in Ontario, with average asking rents for purpose-built and condominium apartments up 18.6% and 18.2%, respectively.
Average Rent for Roommate Rentals Surpasses $1,000 in Ontario
Asking rents for roommate accommodations tracked in B.C., Alberta, Ontario and Quebec rose by an average of 16.1% over the past year to $971. Quebec had the fastest annual increase in roommate rents with growth of 23.8% to an average of $901. In B.C., roommate rentals averaged asking rents of $1,163 (+20.4% annually), with Alberta roommate rents up 14.4% year-over-year to $810 and Ontario roommate rents up 7.1% to $1,009, surpassing $1,000 for the first time. Vancouver and Toronto had the highest average asking rents for roommate rentals in the country at $1,455 and $1,296 in July, respectively.
The data used in this analysis is based on monthly listings from the Rentals.ca Network of Internet Listings Services (ILS). This data differs from the numbers collected and published by the Canada Mortgage Housing Corporation (CMHC).
The Rentals.ca Network of ILS’s data covers both the primary and secondary rental markets and includes basement apartments, rental apartments, condominium apartments, townhouses, semi-detached houses, and single-detached houses. CMHC’s primary rental data only includes purpose-built rental apartments and rental townhouses. CMHC also collects data on secondary market rentals, but this is reported separately.
CMHC’s rental rates are based on the entire universe of purpose-built rental units (rental stock), regardless of rental tenure. CMHC rental rates are reflective of what the average household spends on rental housing and not the current market rents for vacant units. The data used in this report is based on the asking rates of available (vacant) units only and reflect on-going trends in the market. This covers a smaller sample size but is more representative of the actual market rent a prospective tenant would encounter. The Rentals.ca Network of ILS’s data typically provides much higher rental rates compared to CMHC, as vacant units typically reset to market rates when not subject to rent control.
The average and median rental rates in this report can also skew higher than CMHC’s data for the following reasons: the inclusion of larger more expensive unit types such as single-family homes, townhouse units, and large luxury condominium units; the presence of duplicate or multiple listings at the same property and the survivorship bias where more expensive or over-priced units take longer to lease and remain in the sample longer.
Properties listed for greater than $5,000 per month, and less than $500 per month are removed from the sample. Similarly, short-term rentals, single-room rentals, and furnished suites are removed from the sample when identifiable.