Kelowna, B.C.’s tight rental market has seen incremental improvement in the past year, though there’s been no relief in the way of cost.
According to the Canada Mortgage and Housing Corporation, the vacancy rate for purpose-built rental apartments in Kelowna was 1.3 per cent during the first two weeks of October 2023, when it conducted its annual survey. That is an improvement from a year earlier, when it was 1.2 per cent.
These figures, however, fall short of ideal. They’re below the national average of 1.5 per cent during the same period. A year earlier, the country saw 1.9 per cent vacancy rate, which at the time had been the lowest national vacancy rate in over two decades.
Kelowna costs are also higher than the national average. The average rent for a two-bedroom purpose-built apartment, which the CMHC uses as its representative sample, grew 10 per cent in Kelowna to $1,867 for a two-bedroom apartment, from $1,690 a year earlier.
Nationally, the price grew eight per cent to $1,359 in 2023. That growth figure was up from the 5.6 per cent average rent increase recorded in 2022 and above the 1990-2022 average of 2.8 per cent.
CMHC said rent growth nationally exceeded both inflation (4.7 per cent) and wage growth (five per cent), indicating a decline in affordability.
Most markets reported higher rent growth, consistent with the observed decline in vacancy rates. Calgary and Edmonton saw the sharpest acceleration in rent growth among the largest markets.
Toronto, Montreal and Vancouver also saw rent growth accelerate. While Vancouver’s vacancy rate held steady, it still posted one of the lowest rates in Canada.
In terms of rent levels, Vancouver remains the most expensive rental market ($2,181 average monthly rent for a two-bedroom purpose-built apartment), followed by Toronto ($1,961). The
least expensive rental markets remain concentrated in Quebec, exemplified by Montreal’s relatively low average two-bedroom rent ($1,096) when compared with other large centres.
CMHC said immigration supported demand in most large centres such as Toronto, Montreal and Vancouver, while high interprovincial migration contributed in Calgary and Edmonton. Overall, employment gains and low homeownership affordability also supported demand.