With massive immigration and the return of students to campuses, rental housing has filled up even more over the course of 2022.
With a housing vacancy rate at 1.9% nationwide, ” [le] national vacancy rate has not been so low since 2001,” reports the Canada Mortgage and Housing Corporation. This rate was 3.1% in 2021. The federal housing agency released its report on the rental market on Thursday.
A market is considered to be in equilibrium – that is to say that it favors neither tenants nor owners – when the vacancy rate is around 3 and 4%. Below this threshold, the advantage is with the owners who can increase the rents more than in a balanced market.
CMHC Economist Bob Dugan reminds governments of the importance of boosting housing supply. “There is a need to accelerate the growth of housing supply and close the supply gap to improve housing affordability for Canadians,” he said in a statement.
In addition to migrants and students, the spectacular rise in mortgage rates “has made the transition to home ownership more difficult”, notes the organization. These tenants by obligation add to the demand for rental housing.
In the Montreal area, the vacancy rate fell from 3% in 2021 to 2% in 2022. The average rent for 2-bedroom units rose 5.4% in one year, to stand at $1022.
Further details will follow.