The average rent for all Canadian properties listed on Rentals.ca in November was $1,817 per month, up 3.6% annually and 1.0% from October 2021.

Rent Report - December 2021

1. National Overview

The chart below shows the average monthly asking rent for single-family housing, townhouses, rental apartments, condominium apartments, and basement apartments cumulatively from January 2019 to November 2021 of this year, with the annual change in rent shown via the colour of the markers.

The rental market in Canada appears to be firmly on the road to recovery, returning to the levels seen at the start of 2020, but remains below 2019-peak rent levels.

Fig 1 Overall D

Rental Rates by Bedroom Type

The following chart looks at the average rent and annual change in average rent by bedroom type in Canada for all property types (outlier suites were removed).

There was strong growth in November of 2019 across all bedroom types, ranging from 2% for four-bedroom units up to 12% for two-bedroom units.

During the heart of the pandemic lockdowns in November 2020, most bedroom types experienced notable annual declines in average rent, ranging from -1% for studio units to -7% for one- and two-bedroom units. Six-bedroom units were the only bedroom type to experience an annual increase at 5%.

Fig 2.25 Bed TYpe

In November of 2021, the majority of the bedroom types experienced significant annual increases in average rent. Six-bedroom units experienced the largest increase at 15% as there is demand for luxury rental products, followed by four-bedroom units at 9%. One-bedroom units were the only bedroom type to experience an annual decline in average rent at -1%, while two-bedroom units were up $5 on average from one year ago. With many Canadians continuing to work at home, at least part time, they desire more space with some tenants using their “commuting” money toward higher rent.

Rental Rates by Property Type

The chart below looks at the average (area) and median (line) rent by property type in Canada via Rentals.ca listings.

Fig 2 Blt FOrm NovD

The average rent for single-family homes is up 14% annually, moving from $2,272 per month in November 2020 to $2,594 per month in November 2021. The average rent for single-family homes has already moved higher than November 2019 levels, showing a strong recovery from the pandemic.

The average rent for townhouses is up 16% year over year, moving from $1,897 per month in November 2020 to $2,200 per month in November 2021.

Condo apartments have seen their average rent move from $2,037 per month in November 2020 to $2,198 per month in November 2021 – an annual increase of 8%. Condo apartments experienced the largest annual decline in average rent at 19% last year. The recovery has not been as strong for condos as single-family homes and townhouses.

The average rent for rental apartments has increased by 1.6% from $1,636 per month in November 2020 to $1,662 per month in November 2021. Similar to townhouses, rental apartments have also stayed relatively steady throughout the pandemic, with landlords offering incentives to lure tenants, as opposed to the steep rent decreases from individual investor-landlords.

Rent by Rounded-Unit Size

The chart below looks at the average rent and annual change in average rent by rounded-unit size (to the nearest hundred) for condo and rental apartments in Canada (this data covers units from 350 square feet to 1,149 square feet only).

Fig 2.5 Rounded D

In November 2020, the average rent declined annually across nearly all rounded-unit sizes. Units with a rounded unit size of 400 square feet and 700 square feet declined the most at -8%, while units with a rounded-unit size of 1,100 square feet did not experience any significant change in annual rent.

In November 2021, units with a rounded-unit size of 400 square feet experienced the largest annual increase in average rent at 6%, while units with a rounded unit size of 500 square feet experienced the largest annual decline in average rent at -5%.

This data shows that much of the improvement in rent levels this year compared to last year is occurring in the market for larger units, and single-family products.

2. Provincial Rental Rates

The following figure presents the average rent and the quarter-over-quarter change in average rent for all property types across Canada between January 2020 and November 2021 aggregated by quarter for select provinces.

Fig 2.75 Prov

In Q4-2021 (October & November only), the average rent in British Columbia was the highest in Canada, followed closely by Ontario and Nova Scotia. British Columbia had an average rent of $2,182 per month, a 1.6% increase quarter over quarter. The average rent in Ontario was $2,090 in the fourth quarter of 2021, an increase of 1.9% quarterly. The average rent in Nova Scotia was $1,825 per month in Q4-2021, a 1.8% increase quarter over quarter.

In the first and second quarters of 2020, Ontario maintained a higher average rental rate than British Columbia. Since then, British Columbia has consistently posted a higher average rental rate than Ontario.

Rents in Nova Scotia were lower than Quebec in Q2-2020, but have soared over the course of the pandemic, and many landlords report Ontario residents moving back east and working from home, significantly reducing the supply of listings and causing a sharp rise in rents.

3. Municipal Rental Rates

Annual Change in Rent for Top Municipalities

The chart below looks at five of the largest municipalities in Canada, showing the average rent and average rent per square foot (psf) in November 2020 and November 2021, plus the annual change in average monthly rent in those months.

FIg 3 Areas D

In November of last year, the average rent in Vancouver for all property types on Rentals.ca decreased by 12% annually to $2,216 per month. In November 2021, the average rent was up 12% year over year to $2,492 per month. The average rent per square foot also experienced a significant increase year over year in Vancouver of 15%, moving from $3.09 in November 2020 to $3.55 in November 2021. It is worth noting that not all of the listings on Rentals.ca have their size posted by the owner or landlord, so this figure is based on a smaller sample that tends to skew toward newer units, specifically condominium apartment suites.

Calgary rents did not change significantly on an annual basis in November 2020, with the average listing available for $1,379 per month. In November 2021, the average rent increased 4% annually to $1,438 per month. The average rent per square foot has moved from $1.79 in November 2020 to $1.91 in November 2021, representing an annual increase of 7%.

The average rent in Mississauga in November 2020 experienced an annual decline of 13% to $2,088 per month. In November 2021, the average rent had increased annually by 2% to $2,125 per month. The average rent per square foot has decreased from $2.48 in November 2020 to $2.39 in November 2021, which is an annual decline of 4%.

The average rent in Toronto in November 2020 declined annually by a whopping 20% to $2,082 per month, before increasing 10% annually in November 2021 to $2,300 per month. The average rent per square foot has moved from $3.13 to $3.51, which is an annual increase of 12%.

Montreal remains a bright spot for landlords in Canada, with rents rising 3% in November 2020, followed by a 1% rise in November 2021. The rent on a per-square-foot basis is up 7% in 2021, moving from $2.26 in November 2020 to $2.41 in November 2021.

Vancouver

The following figure presents the average rent and average rent per square foot for all property types in Vancouver between January 2020 and November 2021 via Rentals.ca listings.

Focusing on Vancouver, the average rent was $2,507 per month in November 2019. Following a local peak in May 2020, the average rent declined to $2,301 per month in November of last year and continued to decline throughout the course of the pandemic. Through the summer of 2021, the average rents recovered swiftly before slightly declining towards the end of the year, landing at $2,492 per month in November 2021. This average rent has increased annually by 8%.

The average rent per square foot followed a slightly different path, with November 2019 rent at $3.17 psf and moving to $3.18 psf in November 2020. The average rents per square foot began to increase sooner than the average monthly rents, and continued to do so throughout 2021 before landing at $3.55 psf in November 2021. This represents an annual increase of 12%.

FIg 4 Vancouver

Average Rent Per Square Foot for Select Condo Projects in Toronto

The figure below presents the average rent per square foot at select condo projects in Toronto, showing the average rent per square foot for one- and two-bedroom units for the September to November periods in 2020 and 2021.

At Ice Condos – Ph II in downtown Toronto, rent per square foot has increased by 26% annually for one-bedroom units and 16% for two-bedroom units.

For Harbour Plaza West, one-bedroom units experienced rent growth of 25% annually, but two-bedroom units are down annually. For E Condos, one-bedroom units are down 7%, but two-bedroom units are up 14%. However, it is likely that some of the changes are due to a shift in the composition of listings.

Fig 5 Projects

For Minto West Side, per-foot rents are up for one- and two-bedroom units, while they are down for both bedroom types at INDX.

The only consistent data across the projects is that listings are lower during this three month period in 2021 compared to the same time period last year.

4. Rent Forecasts

The following chart looks at the average rent for all property types in Vancouver, Toronto, Mississauga, Montreal, and Calgary from November 2018 to November 2021 (thin line), with the thicker line representing the Bullpen Research & Consulting and Rentals.ca forecasts for the next 13 months.

Vancouver is expected to finish the year with the average rent up 10% to $2,485 per month. Bullpen forecasts that the average rent will continue to rise in 2022, with an expected annual increase of 6% next year to $2,635 per month.

Toronto is forecasted to have the strongest bounceback in 2022, as the forecast calls for an annual increase in the average rent of 11% next year to $2,495 per month. This is similar to how the rental market in Toronto has performed throughout 2021, posting an annual increase of 10% this year following the major declines during the pandemic-impacted 2020.

The average rent in Mississauga is forecasted to increase by 7% to $2,265 per month – not quite as strong as Toronto but more in line with Vancouver’s projected rent growth.

Fig 6 Forecast

Our forecast sees Montreal posting an annual increase of 5% in 2022 to $1,780 per month.

Lastly, Bullen Research & Consulting and Rentals.ca forecasts that the average rent in Calgary will increase by 3% annually to $1,470 per month next year. This is similar to how the market in Calgary performed in 2021, where the average rental rates increased by 4% annually.

5. Conclusion

The average rent across Canada continues to recover in November, as rents have steadily increased since May following a downward slide that lasted for a full year. Toward the end of 2021, the average rents across Canada have nearly recovered to the same levels seen at the start of 2020, and we expect they will continue to rise above 2019-peak levels in 2022.

As has been the trend, larger units experienced stronger annual increases in average rent, suggesting that tenants continue to seek larger units to rent while working from home. One- and two-bedroom units experienced the largest declines out of all the bedroom types in 2020, and their recovery has not been as sharp as the rest of the market. Reinforcing this trend is the performance of units with a rounded-unit size of 500 square feet — posting an annual decline of 5%, the highest out of all the rounded-unit sizes. Landlords have expressed that tenants are looking for an apartment with a separate space to work.

British Columbia continues to claim the top spot as the most expensive province for renters at an average of $2,182 per month, closely followed by Ontario at $2,090 per month. Specifically, Vancouver leads the way with an average monthly rental rate of $2,492 per month ($3.55 per square foot).

While the ever changing landscape makes it difficult to forecast the direction of the rental market in Canada, the overall trend appears to be one of recovery as the average rents continue to rise each month. Bullpen Research & Consulting expects this trend to continue as we close out 2021 and start 2022.

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.