We saw record high average rents in October, all across Canada.
Which province had the highest rent?
Which one saw the biggest jump?
What were the top 10 cities in terms of rent prices?
Which unit type saw the biggest rent increase?
We are going to look into all that today based on the latest Rentals.ca report.
#1 Provincial Overview
Where can you find the cheapest rent in Canada?
In October, the average listed rent for studios was only $824.
And even 3 bedrooms were below $2,000.
That’s in Manitoba, with Winnipeg being its most famous city.
The rent increase by unit type is very interesting.
Average studio rents actually dropped 21% year over year.
1 bedroom up 1%.
2 bedroom up 6%.
And 3 bedroom up 9%.
You can see that Winnipeg is not a very popular choice for young singles and I think it’s because of the limited job opportunities.
Saskatchewan, another prairie province, is similar to Manitoba.
Its average 3 bedroom rent was the lowest across Canada, only $1,430.
The third prairie province, Alberta, with Calgary being its biggest city.
Calgary’s low property prices have been attracting real estate investors over there in the recent couple years.
More people are also moving over there for the same reason.
And the popularity was reflected in the rent increases.
Alberta saw the biggest rent growth in Canada in October.
Studios up 6%.
Both 1 and 2 bedrooms were up 16%.
3 bedroom up 15%.
In terms of the absolute rents, Alberta was still the third lowest in the country, with studio rents at $1,046 and 3 bedroom rents at $1,893.
Over the longer term, it will be important to see if the job opportunities in Alberta will be enough to keep attracting people into the province for a continuous growth.
Now, we are going to see a jump in rent prices when we get to Quebec and Nova Scotia.
In Quebec, average studio rents were at around $1,500.
And 3 bedroom rents at around $2,400.
We also saw double digit rent increases in 1 and 2 bedroom units.
Nova Scotia had similar rents compared to Quebec.
But Nova Scotia actually saw a 10% decrease in studio rents, but a huge 28% increase in 1 bedroom rents and 19% increase in 2 bedroom rents.
3 bedroom rents stayed flat.
And the main reason for the rent surge is population growth.
The Nova Scotia government made a big push for increased immigration.
There were also interprovincial migration, for example, people moving from Ontario to Nova Scotia for a lower living cost.
We saw that the average 1 bedroom rent in the prairie provinces was roughly $1,250.
It jumped to around $1,800 when we got to Quebec and Nova Scotia.
Ready for another jump?
It is going to be above $2,200 for a 1 bedroom.
You bet, Ontario and British Columbia.
In Ontario, average studio rent was already above $1,800.
And 3 bedroom was above $3,000.
The rent increases were kept below 10% and more or less the same for all unit types.
And finally, the most expensive province in Canada, British Columbia.
Average studio rents were almost $2,000, with 3 bedroom reaching almost $3,500.
The rent increases were very steep as well, with double digit increases for all unit types except studios.
If we were to draw one conclusion for all these data, it would be:
Canada is struggling with very steep rent inflation.
And it is because of the reasons we always discussed.
Housing demand created by very high immigration, people shifting from the ownership market to the rental market because of the very high interest rates, landlords shifting part of the increased mortgage cost to the tenants.
You see, the Bank of Canada wanted to lower inflation by increasing the interest rate.
But a by-product of that is actually a very steep rent inflation.
#2 Ranking by City
Let’s take a look at the top 10 most expensive cities in Canada based on the average rent of a one bedroom unit.
They are all in Ontario and British Columbia.
By the way, if you like this kind of video we go outside of Toronto and take a look at the bigger picture of Canada overall, make sure you like, subscribe and hit the bell so you keep getting more and more knowledge.
The city ranking #10, Burlington, with an average one bedroom rent of $2,200, that’s a 5.7% increase from last October.
#9 Guelph, 8.5% increase from last year.
#8 Etobicoke, 5.7% increase.
#7 Richmond Hill, with one bedroom rent reaching almost $2,300, up 16.2%.
#6 Markham, $2,324, a huge 27.5% year-over-year increase.
#5 Mississauga, up 15.5%.
#4 Oakville, with one bedroom rent just above $2,500, up 16.6%.
#3 Toronto, over $2,600 for a one bedroom, but the increase is only 4.9% from last year.
The rent inflation in the City of Toronto was relatively small because the rent was already very high and people were looking for more affordable options in the suburbs.
And as you can see, that really jacked up the rents in the suburbs, narrowing the gap between Toronto and the suburbs.
If you think the rent is very high in Toronto, let’s go to BC.
In the #2 position, we have Burnaby, with average one bedroom rent at $2,700, up 22.4% from last year.
#1, you bet, Vancouver, $2,976 for a one bedroom, up 10.1% year over year.
$3,000 for a one bedroom is very expensive indeed.
As a comparison, Calgary ranks #23, with one bedroom rents at $1,730, almost half the price of Vancouver.
The cheapest city in Canada is Saskatoon, just over a thousand dollars for a one bedroom, one third the price of Vancouver.
So there are definitely more affordable options in Canada.
But when you factor in the weather, the lifestyle, the opportunities, you can see why the most expensive cities continue to be the most popular and that’s why they remain very expensive.
It is a chicken and egg problem.
As we are moving into the winter, the rental market is slowing down and we have to lower the rent in order to minimize the vacancy period.
So there will be some relief on rent increases.
We will have to see how the rental market unfolds when things start to pick up again in Spring 2024.