{"id":19753,"date":"2018-03-13T05:00:48","date_gmt":"2018-03-13T12:00:48","guid":{"rendered":"https:\/\/www.yardi.com\/blog\/?p=19753"},"modified":"2020-12-24T22:50:35","modified_gmt":"2020-12-25T06:50:35","slug":"rental-market","status":"publish","type":"post","link":"https:\/\/www.yardi.com\/blog\/rental-market\/","title":{"rendered":"Rental Market"},"content":{"rendered":"

If you\u2019re\"\"<\/a> a Canadian property owner, manager or renter, here is the scoop from this year\u2019s Ontario Rental Market Overview & Outlook.<\/p>\n

Hosted by Canada Mortgage and Housing Corporation and Federation of Rental-Housing Providers of Ontario, the market survey results were presented at the FRPO & GTAA (Greater Toronto Apartment Association) Rental Market Update Breakfast that took place on February 8, 2018. Industry leaders attend these sessions to gather key analytical data about marketing and rent trends along with policy updates for the apartment and purpose-built industry.<\/p>\n

CMHC\u2019s Ted Tsiakopoulos, regional economist, and Dana Senagama, principal, market analysis for the GTAA, spoke about the new data released in this year\u2019s report. While the presentations focused on Ontario, the report also includes information about other provinces. Keep reading for some key takeaways.<\/p>\n

Tightening Up<\/strong><\/p>\n

Since 2015, Ontario\u2019s economy has been growing faster compared with the rest of the country, and it\u2019s not surprising that Ontario and British Columbia are still the tightest rental markets. Toronto is experiencing record low vacancy rates, influenced by the job market, demographics, cost gap, expectations and new rental supply. Due to lack of supply and slow building, the GTAA also reports\u00a0 accelerated rent growth \u2013 up 4.2%. The expectation is that vacancy rates still have room to fall \u2013 and rents will keep growing.<\/p>\n

Regarding housing types, there\u2019s a higher domestic investment in condos, with 32.7% of condo units rented in 2017 (compared to 30.1% in 2015, and only 18.8% in 2008). Condo rentals significantly outpace apartment rentals. Rentals show a flattening out in the growth trajectory, and new building trends, there is the added challenge of lengthy construction timelines (up to three years).<\/p>\n

Shifting Demands<\/strong><\/p>\n

With renter households outgrowing supply, demand in Ontario is shifting to less expensive housing. Rents for new purpose-built suites are prohibitively expensive for many renters, and only 18% of renter households can afford them. As a result, the demand for secondary rentals \u2014 such as basement apartments \u2014 is increasing. While migration to Ontario is easing it remains above the decade average, exerting further pressure on the supply-demand imbalance. Outside of Ontario, it\u2019s a different story: Alberta and Newfoundland are currently seeing the highest vacancy rates.<\/p>\n

Vacancy Pressures<\/strong><\/p>\n

Regarding risks to Ontario vacancy rates through 2019, the following factors were cited in the report:<\/p>\n

Risks exerting upward pressure<\/p>\n