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Rental vacancy rate inches down

The average rental apartment vacancy rate in Canada's 28 major centres decreased by 0.1 of a percentage point to 2.6 per cent in October 2006 compared to the same period last year, according to the Rental Market Survey released by Canada Mortgage and Housing Corporation.

"Solid job creation and healthy income gains helped to strengthen demand for both ownership and rental housing,” said Bob Dugan, Chief Economist at CMHC's Market Analysis Centre. “High levels of immigration were a key driver of rental demand in 2006, as was the increasing gap between the cost of home ownership and renting. These factors have put downward pressure on vacancy rates over the past year."

"Near record levels of existing home sales and the high level of housing starts in 2006 show that home ownership demand remained very strong, and it continues to apply upward pressure on vacancy rates,” added Dugan.

Adding to this is the high level of condominium completions in some centres. Condominiums are a relatively inexpensive type of housing for renters moving to home ownership. Also, some condominium apartments are owned by investors who rent them out. Therefore, high levels of condominium completions have created competition for the rental market and have put upward pressure on vacancy rates.

The centres with the highest vacancy rates in 2006 were Windsor (10.4 per cent), Saint John, N.B. (6.8 per cent), and St. John’s, N.L. (5.1 per cent). The major urban centres with the lowest vacancy rates were Calgary (0.5 per cent), Victoria (0.5 per cent), and Vancouver (0.7 per cent).

To view more detailed regional results, click here.

December 29, 2006 in Toronto Real Estate Update | Permalink

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