March 19, 2025
Real Estate News
Tenants across Canada may soon benefit from lower rental prices as national averages continue to fall, signaling a potential boom in vacancy rates. Recent reports from Rentals.ca and Urbanation Inc. indicate that the average asking rent dropped 4.8% nationally to $2,088, marking a fifth consecutive month of decline. Similar trends appear in Zumper’s Canadian Rent Index, which noted modest decreases in one-bedroom rental rates.
While the February figures represent the steepest drop since April 2021 and the lowest averages since July 2023, regional disparities are emerging. In cities like Kitchener, Ontario, a modest month-over-month rebound suggests that affordability paired with strong local amenities may be sparking recovery—even as year-over-year numbers remain down.
Alberta presents a contrasting picture: Calgary is witnessing a significant 7% annual drop in rents amid an oversupplied rental market driven by a recent building boom, while Edmonton shows a slight 3% growth. In Canada’s priciest markets, Toronto and Vancouver, an influx of new condominium units has pushed studio rents down by 5-6%, impacting preconstruction buyers who now face challenges covering mortgage costs with lower rental income.
Experts warn that the growing rental inventory may lead to sustained increases in vacancy rates. Projections from the Canada Mortgage and Housing Corporation (CMHC) suggest that major cities such as Vancouver and Toronto could see their vacancy rates rise significantly over the next few years, which might curb rent growth even further. Industry insiders point out that in uncertain economic times, long-term tenants are opting to stay put, dampening rental rate increases and stabilizing overall market conditions.
Source: The Globe and Mail
