The average rent in Canada increased 9% in 2023 to a record high of $2,178 in December 2023.
Across the country, average rents for apartments increased 12.8%, condominiums 6.9%, and houses/townhouses 5.9%, totalling an 8.6% increase across all home types, according to data released Wednesday by Rentals.ca and market research firm Urbanation.
The 8.6% increase in rents in 2023 followed a 12.1% increase in 2022 and a 4.6% increase in 2021. The five-year average annual growth in rent is 4.9%, including a 5.4% decrease in 2020 due to Covid.
Over the past two years, asking rents in Canada have increased by 22%, an average of $390 per month.
Among Canada’s largest municipalities, Calgary posted one of the fastest increases in annual rent growth, rising 14% from last year to an average of $2,071. This increase follows Quebec City at 18.9%. Calgary’s rent also increased by 22.6% in 2022.
Edmonton had average rent prices much lower than Calgary, at $1,467, but rose by 13.5%.
In Canada’s two most expensive cities to rent, Vancouver and Toronto, rental price changes were reasonable. Average asking rents for apartments in Vancouver decreased by 0.7% and increased in Toronto by 2.1% since last year.
Canada faced another unprecedented record in 2023, as rental vacancies dropped to a historic low of 1.5%, according to a study released by Canada Mortgage and Housing Corporation.
The study highlighted that rent prices have increased faster than wages, making it harder for tenants nationwide.
“Lower-income renters have been disproportionately impacted by the below-average vacancy rates, exacerbating the affordability crisis,” said the corporation.
The Canada Mortgage and Housing Corporation attributed the demand for rental housing to employment growth, demographic growth, and the low affordability of homeownership — leading to a higher tendency for people to rent.
While supply increased, it lagged behind the increase in demand, leading to a more competitive rental market and decreased affordability overall.
In 2023, individuals ages 15 to 24, who represent a substantial portion of renters, experienced significant population growth. Alberta saw more than twice the national growth average in this age demographic. Alberta also attracted more interprovincial migrants due to employment opportunities and affordable housing.
Alberta was the province with the fastest-growing rents for purpose-built and condominium apartments in 2023, increasing 15.6% since last year, reaching an average of $1,691. This follows an increase in Alberta of 16.8% in rents in 2022.
While British Columbia remained the most expensive province, the average asking rent decreased by 1.4% since last year to an average of $2,500.
Average listed rents by apartment and condo listing in January increased 11% across the country compared to last year.
The outlook for 2024 should be better, according to Rentals.ca. The rental market will remain undersupplied, said the report, but rent growth should creep closer to the five-year average of around 5%. Creeping closer towards the five-year average is thanks to a slowing economy, a reduced number of non-permanent residents, and an improvement in homebuying activity thanks to a decline in interest rates.
“Relatively affordable markets, such as those in Alberta, should continue to experience above-average rent increases, while more expensive markets, such as those in B.C. and Ontario, should continue to experience rent increases below the national average,” said the report.
Pierre Poilievre commented on the rents increasing to a new record high, reaching an average of $2,196 in January 2024.
“While Justin Trudeau and his housing minister were busy doing photo-ops for fake housing announcements, asking rents up 10% to $2,196/mo for Canadians.”
