COVID has role in improving vacancy rate: analyst
Rate rises fourth year in a row to 2.6%; average rent rises nearly 5%
It got easier to find an apartment in Peterborough last year but it continued to get more expensive if you were on the move.
Peterborough’s rental vacancy rate improved to 2.6 per cent in 2020, Canada Mortgage and Housing Corporation reported Thursday in its annual Rental Market Survey.
That’s up from 2.1 per cent in 2019, 1.5 per cent in 2018, 1.1 per cent in 2017 and 1 per cent in 2016.
“Modestly lower demand combined with stable supply resulted in a higher vacancy rate,” stated Olga Golozub, a senior economics analyst with the CMHC.
The rise in the vacancy rate was partly attributed to a big decrease locally in non-permanent residents, such as international students and work permit holders, because of international travel restrictions of the COVID-19 pandemic that began in March, the survey found.
A decline in employment among local people 15 to 24 and 25 to 44 because of the pandemic was also a factor, CMHC reported, but that was partly offset by a temporary freeze on evictions and pandemic income supports such as the Canada Emergency Response Benefit and other enhanced benefits for students and the unemployed.
The 2.6 per cent vacancy rate is in line with the 10-year historical average for Peterborough, which started the decade with
rates of 3.5 per cent in 2011, 2.7 per cent in 2012, 4.8 per cent in 2013, 2.9 per cent in 2014 and 3.7 per cent in 2015.
The average rent in Peterborough last year was $1,124, up 4.9 per cent from 2019, the agency also reported, as the supply of apartments remained nearly flat.
The survey found 6,087 apartments, up just 0.1 per cent from 6,078 in 2019 and 6,073 in 2018, when there had been a modest jump in the supply after the city introduced policies allowing for the construction of secondary suites in single-detached, semidetached and row houses.
Bachelor apartments had just a 0.6 per cent vacancy rate and an $819 average rent, the agency reported.
One bedrooms had a 2.5 per cent vacancy rate with a $990 average rent, two bedrooms had a 2.8 per cent vacancy rate with a $1,191 average rent and three or more bedroom units had a 2.9 per cent vacancy rate with a $1,427 average rent, the survey found.
At those rents, households in the $52,000 to $74,000 income range can afford 98 per cent of the units, CMHC reported, while households in the $36,000 to $52,000 range can afford 78 per cent of the units.
About 20 per cent of Peterborough’s households have incomes between $25,000 and $36,000 and they can afford just 14 per cent of the rental stock, the survey found.
CMHC also found the gap is widening between the average rents for local vacant and occupied apartments: the average rent for vacant units is $1,318 — 17.8 per cent higher than the average rent for the occupied units, the survey found.
It’s the fourth year in a row that average rents have increased in Peterborough by more than the provincial rent review guideline, which CMHC attributes to a rise in the turnover rate for apartments to 14.6 per cent last year, from 12.8 per cent in 2019, allowing landlords to increase rents to market levels after long-term tenants moved out.
Nationally the average vacancy rate in census metropolitan areas rose to 3.2 per cent and rents crept up, too, with average rates for two-bedroom units in communities with more than 10,000 people rising by 3.6 per cent to $1,165.
The local CMHC results are for the Peterborough census metropolitan area which includes the city, the four surrounding townships of Selwyn, Cavan Monaghan, DouroDummer and Otonabee-South Monaghan, plus Curve Lake First Nation and Hiawatha First Nation.