People are leaving the cores of major cities, including Vancouver, and that has led to some rent drops.
The average monthly rent in Vancouver in October for a two-bedroom apartment was the highest in Canada at $2,712, but it was an eight per cent drop from a year earlier, the steepest fall in B.C.
Meanwhile rents for smaller and suburban areas are stable or rising, according to numbers collected by Rentals.ca and Bullpen Research & Consulting, which looked at 35 municipalities across the country.
This could be seen in Burnaby, which had the sixth highest average monthly rent for a two-bedroom in Canada at $2,247 — after Vancouver, Toronto and nearby areas of North York, Etobicoke and York. The Burnaby average rent dropped only 0.3 per cent from a year ago.
In Vancouver, the average monthly rent for a one-bedroom apartment was $1,901, down 4.3 per cent. Rents for one-bedroom apartments in other cities were off only slightly or increased: down 0.1 per cent in Burnaby and 0.2 per cent in Victoria, while rising 2.4 per cent in New Westminster.
The flight from the core or major cities is most pronounced in Ontario. The average monthly rent in Toronto at $2,531 dropped 14 per cent over a year ago, while it rose 35 per cent in Hamilton to $2,106.
The urban centres with Canada’s highest average rents — Toronto, Vancouver, Mississauga and Oakville — had rents that were five to 17 per cent lower than a year earlier. By contrast, a year ago, those rents had risen between five and 14 per cent from October, 2018.
Paul Danison, content director at Rentals.ca, said the flight from downtown is not at strong in Vancouver. “I believe it’s happening, just not as much an ‘urban exodus’ as in Toronto,” he said. “This trend is opening up more vacancies and causing lower rents for smaller units in downtown and metropolitan areas.”
The report said it’s based on looking at “asking rents,” which can hide even larger drops in rents. “When conditions are poor, landlords will often accept rents below their asking rent rate or offer incentives like one or two months of free rent,” Danison said.
“Vancouver rents are down year-over-year, which suggests a higher vacancy rate.”
He said another indication of a rising vacancy rate is that many landlords are offering incentives to renters in downtown Vancouver and the West End, with some offering one or two months of free rent.
Last week, the B.C. government said it is extending the freeze on rent increases until July 10, 2021 to support renters facing income loss due to the pandemic. The province originally froze rent increases in March 2020 at the start of the pandemic with the ban ending December 1.