VANCOUVER (NEWS 1130) – There’s been a lot of talk about the trials and tribulations of buying a home in Metro Vancouver, but the latest market numbers show just how hard it is for anyone looking to rent a place in the region as well.
A new report from the Canada Mortgage and Housing Corporation finds local vacancy rates are still very tight and rents keep on leaping higher.
“The rental market does continue to be very tight in Vancouver. The vacancy rate for purpose-built apartments was 0.9 per cent in 2017,” says CMHC principal market analyst Eric Bond.
“This is a slight increase from the 0.7 percent vacancy rate that we had last year but it’s now the third year we’ve had vacancy rates under one percent in Vancouver and that is despite record construction of rental apartments over that time. That really speaks to the strong demand for rental accommodation in the region,” he tells NEWS 1130.
The CMHC Rental Market Report for 2017 finds the average monthly rent for a two-bedroom unit in Vancouver is now $1552, the highest in Canada.
“Average rents increased 5.7 per cent for Metro Vancouver between 2016 and 2017 and this is the third consecutive year in which average rents increased faster that the provincially allowable increase, which was set at 3.7 per cent for this year.”
Bond says there are two major factors putting upward pressure on Metro Vancouver’s rental market.
“The rapid increase in entry-level home prices is one. Current renters who are looking to purchase their first property, which is typically an apartment condominium, face two common barriers — rising carrying costs and rising required down payments due to higher prices. Some are now choosing to rentals for longer which adds to demand,” Bond explains.
“The second major contributor to demand is higher migration to the region, mainly by people from other provinces who are attracted to Vancouver because of its strong labour market. Whenever you have new migrants to a region, they tend to rent for a period of time before moving into home ownership.”
CMHC’s 2017 Housing Market Outlook for Vancouver found the resale housing market has been operating at “two speeds” since the middle of 2016.
While price growth in the single-detached home segment has slowed in the past year due to many buyers being priced out of the market, CMHC says apartments and other more affordable units have seen rapid and continuing price growth through 2017.CMHC Rental Market Report for 2017