Rents start to rise in Canada's biggest cities following steep declines
The days of deep discounts for renters in Canada's biggest cities may be over.
After a year of steep declines as people fled to larger dwellings further away and immigration ground to a halt, the average month-over-month rent for one-bedroom units rose in Toronto (0.3 per cent), Vancouver (2.2 per cent), and Montreal (0.9 per cent) in March, according to a new report by Rentals.ca's and Bullpen Research & Consulting.
But there's a long way to go before a return to pre-pandemic levels. It was Toronto's first monthly increase after falling every month in 2020 as well as in January and February this year. It's also down 18.7 per cent year over year for all property types.
Vancouver is down 8.8 per cent compared to last year and Montreal is down 4.4 per cent.
Nationally, the average asking rent is 8.5 per cent lower at $1,685 a month, compared to $1,842 in March of last year.
"Despite the drop in rent on a national level, there are signs that the rental market has bottomed out, with monthly rent increases in Vancouver, Toronto and Montreal," said Bullpen Research & Consulting president Ben Myers in a release.
"With the likelihood that downtown offices will reopen within the next year, it is clear that some tenants are taking advantage of the lower rents and greater choice to secure a better location or bigger unit than they had prior to the pandemic."
Calgary is the only city among the country's five largest that isn't down year over year, rising 1.8 per cent. Edmonton is down 6.6 per cent.
The report found a glut of smaller condos is having an outsized effect on the national average rent.
"We have seen a clear shift in the composition of units on Rentals.ca prior to COVID and in early 2021," said Rentals.ca chief executive officer Matt Danison in a release.
"There are fewer large units and single-family homes for rent, and many more tiny condominium suites, as tenants look for larger units to work from home. This shift is having a meaningful impact on the data, as the rent per square foot is actually higher in March of this year versus March 2020."
Vancouver is home to the highest rents in the country. The average one-bedroom unit goes for $1,932 a month, while a two-bedroom unit stands at $2,598.
Toronto is second at $1,810 for a one-bedroom unit, and $2,370 for a two-bedder.