Average asking rent in Canada across all property types rose to $2,004 in March, marking an annual increase of 10.8 percent as demand continues to outpace supply.
According to the latest release of the National Rent Report from the Rentals.ca and Urbanation, rents rose 1 percent month-over-month, the first monthly increase reported since November.
Canadian renters are feeling the affordability crunch, paying an additional $196 a month on average, based on year-over-year figures.
Higher interest rates have sidelined some house hunters, diverting demand into the rental market. This, coupled with significant population growth, is expected to continue to push the trend higher.
“Spring arrived with a highly competitive rental market in Canada, driven by a record population increase of over 1 million people in the past year and low homeownership affordability after last year’s spike in interest rates,” said Shaun Hildebrand, president of Urbanation. “With supply unable to keep up with current levels of demand, expect further upward pressure on rents in the coming months.”
In March, Vancouver and Toronto continued to have the most expensive rents in the country. Vancouver was the priciest, where average monthly rent for a one-bedroom home was up 17.3 percent annually to $2,743, and up 21.5 percent annually to $3,653 for a two-bedroom. Modest month-to-month increases were reported as well.
In second place was Toronto, where asking rent for a one-bedroom home was up 22.2 percent annually to $2,506 and up 19.7 percent annually to $3,286 for a two-bedroom.
Of Canada’s largest cities, Calgary has registered the biggest rent increase for the second month in a row for condominium rentals and apartments, with a hike of 24.9 percent year-over-year to $1,890.
Toronto was in second with rent for condominium rentals and apartments rising 22.4 percent annually to an average of $2,818 in March.
Rapidly rising rents weren’t limited to big cities; a dozen mid-sized cities in Ontario saw a swift uptick in demand, translating into higher rents. Scarborough and Brampton, thanks to high immigration levels, saw year-over-year average rent increases of 34.9 percent and 29.1 percent respectively.
As renters continue to look for housing alternatives in the face of rising rents, demand for private room and shared accommodation is increasing, with the highest rent hikes for this housing type seen in British Colombia and Ontario.
Rents for purpose-built and condominium apartments in Canada were trending upwards as well, registering double-digit annual increases in March.
