(Toronto) The situation is not rosy for renters in the real estate market across the country. Several factors can explain the situation: rising interest rates which discourage potential buyers, thus maintaining pressure on rents, galloping inflation, population growth and the slowdown in the construction sector.
The situation is frustrating tenants even more than usual. It pushes them to try to find accommodation quickly. Marissa Giesinger of Calgary says she has to work hard to save money to be able to put down a deposit. “And we’re not even sure we like the place where we’ll be staying,” she comments. You also have to compete with dozens of people for accommodation. It’s really stressful! »
Demand being high, owners are taking advantage of this to present severe conditions.
For example, Ms. Giesinger and her boyfriend need to be patient. Added to the high prices of apartments is the difficulty of finding an owner who accepts their pets, two dogs and a cat.
“We made the difficult decision to send our dogs to someone else until we found affordable housing where our pets would be accepted,” she says. It’s really stressful. »
Giacomo Ladas, director of communications at Rentals.ca, says the market is being hit by “an almost perfect storm” and the winds aren’t about to die down.
“All of these factors place a heavy burden on the rental market. Even though we are coming out of the usually busy summer season, the demand is such that the situation will persist this fall and winter,” predicts Mr. Ladas.
According to data from Rentals.ca and research firm Urbanation.ca, rent prices increased 1.8% from July to August and 9.6% from August 2022 to August 2023 to reach $2,117 per month. last month in Canada.
From May to August, the rent charged had climbed an average of $103, an increase of 5.1%.
The highest rents in the country are still in Vancouver and Toronto.
Rents for a three-bedroom apartment grew 13.1% in Vancouver year over year to $2,988. Those for a four-bedroom reached $3,879, an increase of nearly 10 percent on a year-over-year basis.
In Toronto, rent for a three-bedroom apartment rose nearly 11% to $2,620. A four-room one costs $3,413 (7.1%).
Montreal comes in 22nd in the country. The price of a three-bedroom apartment averages $1,769 per month, an increase of 15.8% compared to the same period last year. That of a four-room apartment rises to $2,237 per month, an increase of 15% compared to September 2022.
Quebec ranks 31st. The price of a three-bedroom apartment rose to $1,254 per month (7.1%) and that of a four-bedroom apartment rose to $1,595 per month (13.2%).
This kind of data has convinced many tenants, like Kanishka Punjabi, to abandon their hopes of moving in the short term.
“I gave up two days ago because the rental market is so bad,” she says.
This public relations specialist lives in Mississauga, but wanted to find accommodation in downtown Toronto to be closer to her work.
The competition is fierce. For example, an apartment Ms. Punjabi liked received 25 offers in one week.
“Some have sent an offer without visiting the apartment because there are a lot of people who are desperate,” she emphasizes. There is not enough housing. »
According to the Canada Mortgage and Housing Corporation (CMHC), Canada needs approximately 3.5 million additional housing units by 2030 to restore affordability. But the gap remains large. CMHC calculated that the monthly seasonally adjusted annualized number of housing starts decreased 1% in August, from 255,232 to 252,787 compared to July.
Despite the slowdown, Rishi Sondhi, a TD Bank economist, says it’s been a good year because developers want to take advantage of high prices. Because of demographic growth and escalating interest rates, “supply is struggling to keep up with demand,” he emphasizes.
“In the short term, it would be unrealistic to expect too much from a reprieve (in interest rates) because population growth will remain strong over the course of the year. This is one of the main factors [of the current market state]. »
