Rental data from two Canadian-based agencies is suggesting a housing market correction coupled with recent Bank of Canada interest rates hikes could mean higher costs in 2022 for those renting in the country’s major cities.
Both Rentals.ca and Zumper.com, which aggregate data from vacant units, say rents are likely to continue to rise as many reconsider locking into mortgages amid interest rate hikes – spurred on by Wednesday’s surprise one per cent bump.
“There are many moving parts that can affect the housing market across Canada, including rising interest rates, persistent inflation, supply chain issues, and employers’ decisions about requiring in-office work,” says Ben Myers, president of Bullpen Research & Consulting.
“The recent report by the Canada Mortgage and Housing Corporation suggests Canada remains significantly undersupplied for housing, which continues to impact rental markets and migration patterns.”
Both Ontario and British Columbia have the highest monthly rental rates at $2,456 per month and $2,232 per month respectively.
Ontario rents are up 1.8 per cent monthly and 14 per cent year over year, compared to 1.9 per cent and 25 per cent in B.C.
In Nova Scotia, average rents have recently spiked with reports of out-migration from Ontario causing rental surges in that province.
The Maritime locale had a relatively high average monthly rental rate at $2,177 per month in June, equating to a 19 per cent increase, year over year.
In Hamilton, the two analysts estimate renters will have to fork over almost $1,600 a month for a one-bedroom unit, with Rentals’ average at $1,603 and Zumper’s Canadian Rent Report putting the price at $1,540.
As of the end of March, Rentals.ca put Hamilton 20th on its list of 35 cities in terms of the highest one-bedroom average monthly rent. The city was 13th among 24 on Zumper’s list.
A two-bedroom in the Hammer will run somewhere around $1,970 with the rental firms’ averages at $2,055 and $1,900, respectively.
The combined average price of two companies data on one-bedroom suites suggests Hamiltonians are paying about $170 more per month, year over year.
Year-over-year increases in two-bedroom rentals were up about $280 a month.
Two–bedroom units in St. Catharines were very much in demand with about a 12 per cent increase year to year, bumping the average rate to $2,150, according to both agencies.
Toronto is still number two on both lists, with a one-bedroom averaging $2,100 a month and two-bed units costing $2,900.