Market update May 2024: Rents soften as supply increases

Urbanation President Shaun Hildebrand explains softer rental growth: “As population growth slows with caps on non-permanent residents, and supply increases [with] rental completions continuing to rise, rent growth should continue to moderate towards more sustainable levels.”

• The Canadian Real Estate Association (CREA) reports an average national home price of $698,530 in March, up 1.9% from February and 2% year over year.

• CREA also reports a 0.5% uptick in month-over-month home sales in March.

• The sales-to-new-listings ratio (SNLR) of 57.4% falls slightly below the 60% threshold for a seller's market, meaning the national housing market is still balanced.

• “While the official March monthly numbers were quite flat, anecdotal evidence from late last month and early April suggests activity is ramping up,” says Larry Cerqua, Chair of CREA.

• The Canada Mortgage and Housing Corporation (CMHC) reports a 1.6% decrease in nationwide housing starts, from 245,665 in February to 243,957 in March. Increased multifamily construction boosted Toronto’s housing starts by 10%.

• It appears the provincial government's initiatives to accelerate multifamily construction, including new legislation, are proving effective.

• As a result, the average national asking rent fell slightly by 0.6% to $2,181 from February to March, according to Rentals.ca.

• In Ontario, rents for purpose-built and condo apartments dropped by 0.9% between February and March, causing the average to fall to a 10-month low of $2,410. Despite this, Toronto is still the third most expensive Canadian city for renters.

• Rent prices nationwide may fall further if the Bank of Canada follows through with its anticipated rate cut in June, as owners compete with more affordable mortgages to attract occupants.

More rental market headlines

Striking tenants mark one year of withholding rent from landlords – CBC

Landlords reporting increase in tenants refusing to pay rent or leave – CTV News

Equifax Canada tests use of rental data for credit scores – Canadian Mortgage Professional