Rental vacancy rate dips amid strong demand: CMHC
Canada’s overall vacancy rate dropped for a second year in a row, as demand for rental housing grew at a faster pace than supply, according to the Canada Mortgage Housing Corp.
In its annual rental market survey, the housing agency said Wednesday in 2018, the vacancy rate across the country was 2.4 per cent, down from three per cent in 2017.
CMHC said demand for rental housing grew at a faster pace than supply. It found that the number of occupied units climbed by 2.5 per cent in October 2018, compared with an increase of 1.9 per cent in the same month a year earlier.
Ontario, B.C. and Manitoba all saw small increases in its vacancy rates, while Quebec, Alberta, Saskatchewan and the Atlantic Provinces all saw declines amid steady demand for rental units, the agency said.
“The decrease in the vacancy rate was attributable in part to the strong increase in international migration,” said Aled ab Iorwerth, CMHC’S deputy chief economist.
“This factor, combined with the growth in youth employment and the aging of the population, drove up demand for rental housing.”
The agency said international immigration climbed by 23 per cent in the first half of the year, compared with the same period a year earlier, tightening vacancy rates because newcomers often rent when they first arrive.
It also attributed the decline to a growth in the senior population and an improvement in the employment rate among 15- to 29-year-olds that may have led to more young adults leaving the family home for rentals.
Real estate analyst Ben Myers said the introduction of a stricter mortgage stress test, along with rising interest rates, can also be blamed for the decline in vacancy rates and rising rents in the country’s biggest cities as more people opt to rent.