Average Annual Rent Hike Doubles Wage Increase in Canada

Average rents across Canada rose 11.8% YOY in October, more than double the annual hourly wage increase of employees at 5.6%, according to a report from Statistics Canada.

Rents are now averaging $1,976 for all property types in Canada.

In the latest National Rent Report from Rentals.ca, Urbanation, which tracks rentals, reported that unprecedented rent growth is actually getting hotter with each interest rate increase.

“The unprecedented growth in rents underway is broad-based across Canada, with most markets reporting double-digit annual rent inflation,” said Shaun Hildebrand, president of Urbanation, in the report.

“The rental market keeps getting hotter with each interest rate increase, coupled with a record high increase in the population. The need to ram up rental supply has never been greater,” Hildebrand said.

According to a report from the Canadian Real Estate Association (CREA), the average rent has surged 9.2% while benchmark resale prices have declined 9.9% since March—when Canada’s central bank started raising interest rates.

Vancouver topped the list of large markets (populations over 1M) with the highest rents for purpose-built and condo apartments in October, averaging $2,976. Toronto was the second-highest metro, with rents for one-bedroom apartments costing $2,478—a YOY increase of nearly 24%.

In the third most-expensive market, Ottawa’s rents have surged 7.6% in October from the previous month, with rents now averaging $2,146.

The most affordable metro in Canada’s largest markets is Edmonton, with average rents of $1,273 last month. The most affordable mid-sized markets were Quebec City and Winnipeg, which had the slowest annual rent growth of 9.9% and 5.2%, respectively.

Provincially, rents increased the most in Atlantic Canada, (Nova Scotia, New Brunswick, Newfoundland, Labrador, Prince Edward Island) with YOY growth of more than 30%.

British Columbia remained the most expensive province for renters with an average of $2,433.

The provinces with the fastest growing rents also experienced the fastest rates of population growth during the first three quarters of 2022, the Rentals.ca report said.

The provinces with the slowest rates of rent growth—Saskatchewan, Manitoba, and Quebec—record below-average population growth, the report said.