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Average rent for new tenants went up more than 18% last year, CMHC says

A sign advertises apartments for rent in Vancouver. Much as it did across the country, the vacancy rate declined in Vancouver, while average rents went up sharply last year. (Ben Nelms/CBC)

A sign advertises apartments for rent in Vancouver. Much as it did across the country, the vacancy rate declined in Vancouver, while average rents went up sharply last year.

Photo:  (Ben Nelms/CBC)

RCI

Tightest rental market since 2001

A surge in demand pushed Canada's rental market to its tightest level in two decades last year, with the vacancy rate in purpose-built apartments dipping below two per cent and rent for new tenants going up by 18 per cent.

Those were some of the main takeaways from the Canada Mortgage and Housing Corporation's annual report on the state of Canada's rental market.

The figures cited above were for purpose-built rental apartments, so they don't include what's happening in condos, or in apartments built out of occupied family homes.

For purpose-built rentals, the national vacancy rate fell to 1.9 per cent last year, its lowest level since 2001. 

Booming demand for apartments pushed up the price to get one, too, with the average rent hitting $1,258 a month. That was up by 5.6 per cent from the previous year's level, and roughly twice the annual average seen for the past 30 years.

But rent didn't go up at the same pace for every unit.

Renters across the country are feeling the squeeze
Average rent for a 2-bedroom purpose-built unit.Enlarge image (new window)

Renters across the country are feeling the squeeze Average rent for a 2-bedroom purpose-built unit.

Photo: Source: Canada Mortgage and Housing Corporation CBC News

Apartments where there was a change in tenants saw the rent go up by 18.9 per cent. Those where there was no change in tenancy saw rents go up by only 2.9 per cent, on average. This reflects the fact that, once a tenant vacates a unit, landlords are generally free to increase asking rents to current market levels, the CMHC said.

That gap was even more stark in two of Canada's biggest cities, Toronto and Vancouver, where average rents for a unit that saw a tenant change went up by 29 and 24 per cent, respectively.

Geordie Dent, the executive director of the Federation of Metro Tenants Association, has spent more than a decade as a watchdog for the rental market in Toronto. He says the situation is as dire as he's ever seen, with a surge in so-called renovictions, where landlords are eager to take advantage of higher market rents by evicting tenants and raising rents to someone new

There's an incentive for them to try to illegally evict people and raise the rent, he told CBC News in an interview. He says he hears stories every day of people staying in unsuitable housing situations because of desperation. They're afraid that if they get kicked out of their current place for a new one, rent's going to be like $1,000 higher.

Pete Evans (new window) · CBC News 

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