Average rental apartment vacancy rises to 2.6 per cent in major centres: CMHC

OTTAWA – Canada’s overall apartment vacancy rate has risen over the past year, with an increased supply of rental units and a slowdown in household formation by Canadians being cited among the reasons.

Canada Mortgage and Housing Corp. says the average vacancy rate in 35 major metropolitan areas across the country rose to 2.6 per cent in October from 2.2 per cent in October 2011.

However, the federal agency says demand for rental condominium apartments remained strong, with the vacancy rate holding steady in most of Canada’s largest urban centres, including Toronto, Montreal and Vancouver.

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Major centres with the lowest vacancy rates in the primary apartment rental market were Regina (1.0 per cent), Thunder Bay (1.1 per cent) and Calgary (1.3 per cent).

Those with the highest vacancy rates were in Saint John, N.B., (9.7 per cent), Windsor, Ont., (7.3 per cent) and Moncton, N.B., (6.7 per cent).

Meanwhile, CMHC says average rent for two-bedroom apartments in existing structures increased 2.2 per cent in the same period.

“Lower levels of household formation among young adults reduced rental housing demand,” said Mathieu Laberge, deputy chief economist at CMHC’s Market Analysis Centre.

“This, combined with an increase in the supply of newly constructed, purpose-built rental apartments, pushed Canada’s vacancy rate upward.”

The highest average monthly rents for two-bedroom apartments in new and existing structures in Canada’s major centres were in Vancouver ($1,261), Toronto ($1,183) and Calgary ($1,150).

The lowest average monthly rents for two-bedroom apartments in new and existing structures were in Saguenay ($549), Trois-Rivieres ($550) and Sherbrooke, Que., ($578).