As elsewhere in the country, the cost of rent in the Montreal region continued to rise in 2023. Inflation and real estate market conditions led to the strongest increase in at least 30 years, reveal data published Wednesday by the Canada Mortgage and Housing Corporation (CMHC). And the housing vacancy rate has fallen further, reaching a rate of 1.5% in 2023 in the Montreal region, compared to 2% the previous year.
“The supply of housing is struggling to keep up with the strong growth in demand supported by record migration, employment and high costs of property,” underlines the CMHC annual report.
The organization specifies that the strong demand for rental housing in the metropolitan region is explained by population growth. Net migration has more than doubled in Quebec in 2023 with the arrival of a record number of non-permanent residents, it is noted.
“There has been a lot of apartment construction in recent years, especially concentrated in large metropolitan areas, for example in Montreal, Quebec and Gatineau. On the other hand, demand is very strong. There is a sharp slowdown in homeownership and people are releasing fewer homes to buy a condo or a house,” explains Francis Cortellino, economist at CMHC, in an interview with Duty.
Eroded affordability
The average increase in rent for two-bedroom apartments is 7.9% in the Montreal region, reaching 1,096. Rents have thus increased more quickly than the average salary in the region, which has increased by 4.5%, underlines the CMHC report, which notes that the affordability of the rental market has continued to erode. Additionally, the vacancy rate for the cheapest rents is very low, at 1%.
Mr. Cortellino points out that the different regions of Quebec have also experienced a tightening of rental supply. Housing construction has progressed outside major centers, but not at the same level as population growth.
“The regions have experienced an increase in population in recent years, but it is because of the pandemic,” indicates Francis Cortellino. “There are many people who have left large centers like Montreal or the suburbs to settle in smaller municipalities. Vacancy rates in the regions are below 2%. »
The rental market situation is similar elsewhere in Canada. Across the country, the vacancy rate for apartments intended for rental reached 1.5% in 2023, while it was 3.1% in 2020 and 2021. Furthermore, the increase in rent average jumped to 8%. If vacancy rates fell significantly in Toronto, Montreal, Calgary and Edmonton, they were stable in Vancouver and Ottawa, notes the CMHC.
Further details will follow.
With Sarah Boumedda