Metro apartment vacancy rate rises…

Metro apartment vacancy rate rises due to jobs slowdown, increase in units

Financial PostDecember 17, 2009

The apartment vacancy rate in Metro Vancouver has increased to 2.1 per cent, following several years of vacancies below one per cent, according to the fall 2009 edition of Canada Mortgage and Housing Corporation’s Rental Market Report.

The Metro apartment vacancy rate in fall of 2008 was 0.5 per cent.

The CMHC report credited a slowdown in employment throughout 2009 and an increase in rental stock, as well as a shift to home ownership as low mortgage rates and lower home prices drew more people into the market.

“Renters had an easier time finding rental accommodation in [Metro] Vancouver, this fall compared to last year,” the report issued Wednesday said.

The number of apartment units built for the rental market increased by 1,000, or one per cent, the report said.

But CMHC noted that despite the increase in offerings for renters, the region’s vacancy rate remains below the national average and among the lowest in the country.

The vacancy rate across the country’s 35 biggest urban centres was 2.8 per cent as of October this year, up from 2.2 per cent a year earlier.

As well, the highest average monthly rents for two-bedroom apartments were in Metro Vancouver ($1,169), followed by Calgary ($1,099), Toronto ($1,096) and Ottawa ($1,028).

At the national level, CMHC chief economist Bob Dugan said: “Demand for rental housing in Canada decreased due to slower growth in youth employment and improved affordability of home ownership options.

“Rental construction and competition from the condominium market also added upward pressure on vacancy rates.”

Between October 2008 and September 2009, the agency said 15,657 new rental units were completed in major Canadian centres, along with 45,655 condominium units.

“Condominiums are a relatively inexpensive type of housing for renters moving to home ownership,” said CMHC, an agency of the federal government.

Eight of the 10 provinces saw their vacancy rates rise over the last year. Most notably, Alberta’s rate was up three percentage points to 5.5 per cent, while British Columbia’s rate rose 1.8 points to 2.8 per cent.

Among urban centres, the highest vacancy rates were in Windsor, Ont. (13 per cent), Abbotsford, (6.1 per cent), Peterborough, Ont. (six per cent), Calgary (5.3 per cent) and London, Ont. (five per cent). The lowest vacancies were in Regina (0.6 per cent), Quebec City (0.6 per cent), St. John’s, N.L. (0.9 per cent), Winnipeg (1.1 per cent), Kingston, Ont. (1.3 per cent) and Victoria (1.4 per cent).