Rental demand in oil-producing provinces waned during the month of April as low oil prices continue to impact the housing market; meanwhile, Ontario and B.C. are seeing demand rise month-over-month.
“Offsetting regional trends (we’re seeing) reflects the negative impact of lower oil prices on rental demand leading to higher vacancy rates in oil-producing provinces, particularly Alberta and Saskatchewan,” said Bob Dugan, chief economist at CMHC’s Market Analysis Centre, in a statement.
According to CMHC's spring rental market survey, the average vacancy rate for primary purpose-built apartments in Canada’s 35 major centres was 2.9 per cent in April 2015, compared to 2.7 per cent in April 2014.
The comments follow sentiment from investors who have mixed reactions on the state of the market in Alberta, with some acknowledging a bit of a slowdown given a tough job market.
“More and more landlords are preparing for the reality that their units could be vacant for a month or two before finding someone qualified,” said Bill Blake, a landlord and member of the Alberta Landlord Association. “People are having to break leases, which is making it tough for landlords.”
On the other hand, others are witnessing a different picture.
“We are finding the opposite," said Don Campbell, a real estate analyst with REIN "There seems to be more people in the 'renter' pool than the buyer pool right now. And, in fact, "street rents" for quality properties have been inching upwards as ads are drawing more calls in Edmonton and Calgary,”
Meanwhile, Ontario and B.C. continue to benefit from strong job markets, which is providing a solid crop of tenants and millennials aged 15 to 24 for landlords.
Average rent for a two-bedroom unit in Canada, including new and existing structures, was $949 in April 2015, while the highest average monthly rent for a two-bedroom apartment was recorded in Vancouver ($1,345), followed by Calgary ($1,319) and Toronto ($1,269).
The census metropolitan areas (CMAs) with the lowest vacancy rates in April 2015 were Guelph (0.6 per cent), Victoria (1.2 per cent) and Vancouver (1.4 per cent). The CMAs with the highest vacancy rates were Moncton (8.8 per cent), Saint John (8.4 per cent), and Gatineau (6.2 per cent).