While housing prices in Canada continue to rise, it seems that fewer people are buying and more people are renting. Unfortunately, as house prices have continued to rise, Canada's rental market has also seen a huge increase in prices. However, even as prices rise, more rental properties are being built in Canada than ever before.
According to the most recent numbers from the Canada Mortgage and Housing Corporation (CMHC), the country is currently seeing more construction on rental units than it has in at least 30 years. This growth rate for rental properties is unprecedented.
As of June 2019, there were over 62,000 rental properties under construction across the country. Compared with June 2018, when that number was just over 52,000, that's a steady increase. The largest increase in rental construction actually came in the period between April 2015 and May 2016, when the number jumped from 28,257 to 43,353.
It makes sense, however, as demand for rental properties continues to rise, driving prices even higher as well. According to Rentals.ca's 2019 market predictions, there are four major factors that are driving rent prices up: more people staying in the rental market due to rising home prices, homeowners staying in houses longer without selling, rising interest rates across the country, and an influx of new immigrants who are looking for places to live. Rentals.ca also reported in February 2019 that the average rent for their listings across the country for January 2019 was $1,854.
The situations are worse in large cities like Toronto and Vancouver. Toronto itself is seeing a new problem that is driving rents higher with the proliferation of Airbnb rentals across the city. Houses that would otherwise be occupied are sitting vacant, waiting for tourists who will gladly pay a premium that is far higher than the monthly rent the property owners could charge.
Despite the fact that the CMHC had previously reported that Canada's housing prices would stay steady among higher sales (which rose 24 percent in Toronto and Vancouver this summer), economists still warn that Canada could be on the verge of a house price correction.
Basically, whether you end up buying or renting, you're going to be paying more than you might expect. At least for a little longer.