Average asking rents in Canada hit a record high of $2,042 in June, surpassing the previous record set in November 2022 ($2,024) by 0.9%. The 1.4% increase in rents from May represented the fastest month-over-month increase so far this year, causing the annual rate of rent inflation to accelerate to 7.5% from the 6.5% annual rate recorded in May. Over the past two years, average asking rents in Canada have increased by 20%, or by an average of $341.
Rentals.ca July 2023 Rent Report
Rentals.ca July 2023 Rent Report
1. National Overview
Average Rents Reach Record High as Growth Accelerates
Annual rent inflation in June remained below the double-digit growth experienced during most of 2022 and early 2023. However, additional upward pressure on rents occurred as the population expanded at a record pace, the unemployment rate remained near a record low, and homebuyers became more cautious with more interest rate increases.
Rents Rise Fastest Month-over-Month for Smallest Units
Annual growth in asking rents for purpose-built and condominium apartments rose to 8.9% in June from a 7.3% pace in May, bringing the average rent to a record high $1,968. On a monthly basis, rent growth was strongest for the smallest and least expensive unit types, with studios and one-bedrooms seeing rents rise 2.6% and 2% during the month, respectively. Compared to a year ago, rents have increased the most for one-bedrooms units with annual growth of 10.4%. Larger and more expensive units represented by two-bedroom and three-bedroom apartments recorded month-over-month growth that was less than half of their smaller unit counterparts, with increases of 0.7% and 0.8%, respectively.
2. Provincial Overview
Alberta Maintains Lead for Annual Rent Growth while Quebec Moves into Second Place
Alberta remained the provincial leader for annual rent growth for the second consecutive month during June, with average asking rents for purpose-built and condominium apartments up 18.3% year over year to $1,552. On a month-over-month basis, rents grew the most in British Columbia (+3.5%), followed by Manitoba (+2.6%) and Alberta (+2%).
Quebec took over the second spot for annual rent growth in June, recording an 11.6% increase for purpose-built and condominium apartments that knocked Ontario’s growth of 9.3% down to third place. Month-over-month rent growth in Ontario and Quebec at 0.3% and 0.5%, respectively, was well below the national average of 1.3%.
British Columbia remained the most expensive province for tenants with an average monthly asking rent of $2,550 for purpose-built and condominium apartments, followed by Ontario’s average rent of $2,415 in June. At $1,552, average asking rents for purpose-built and condominium apartments in Alberta were 39% less than in British Columbia and 36% less than in Ontario.
3. Municipal Overview
Calgary Rents Surpass $2,000 for First Time to Exceed Rents in Montreal
Average asking rents for purpose-built and condominium apartments grew 18% annually in Calgary to reach $2,008 — surpassing the $2,000 level for the first time and overtaking Montreal as the fourth most expensive among Canada’s largest cities. Vancouver and Toronto, representing the country’s most expensive rental markets with average asking rents of $3,301 and $2,813, respectively, recorded annual rent growth of 15.7% and 15.4% in June. Ottawa, the third most expensive of Canada’s largest markets with an average asking rent of $2,146 in June, saw similar annual rent growth of 15.3%. Each of Canada’s six largest cities experienced double-digit annual rent inflation in June for purpose-built and condominium apartments.
Scarborough and Brampton Continue to Post Fastest Rent Growth in Canada
With an average asking rent of $3,230 for purpose-built and condominium apartments, Oakville was the only suburb of the GTA that was more expensive than the City of Toronto in June. Richmond overtook Burnaby and Coquitlam to become Vancouver’s most expensive suburb with average asking rents of $2,974 in June, recording the third fastest annual rent inflation in Canada (25.7%). The fifth and sixth highest-priced rental markets among Canada’s mid-sized cities were found in the York Region of the GTA in Richmond Hill ($2,679) and Markham ($2,669), followed by western GTA municipalities of Mississauga ($2,646), Etobicoke ($2,630), and Brampton ($2,620). Brampton was the second ranked city for fastest annual rent growth in June with an increase of 25.8%. Scarborough, ranked 14th for highest rents among Canada’s mid-sized markets with an average of $2,511 for purpose-built and condominium apartments in June, maintaining its position as the growth leader with a 27.8% annual rent increase. Out of the 25 fastest growing mid-sized markets, 21 posted annual rent increases above 10% in June.
Average Rent for Roommate Accommodations Up 15% from Last Year
A look at asking rents for roommate accommodations in Canada’s four largest provinces reveals an average monthly cost of $963 in June, up 15% from a year ago. Annual growth was strongest in the most expensive province in British Columbia, where roommate rents were up 21% to an average of $1,157. Quebec also posted a large 21% annual increase in roommate rents, which reached an average of $890. By city, average roommate rents were highest in Vancouver at $1,454, followed by Toronto at $1,288, Ottawa at $947 and Montreal at $927.
Rentals.ca Data
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.
