Rents on the rise again in Oshawa and most of Canada – Rentals.ca Rental Report
Published March 8, 2022 at 11:13 am
As we climb out of the pandemic and consumer confidence in the market returns, rental prices are on the rise in Canada, and none more so than one-bedroom apartments in Oshawa, which rose 20,93 per cent in January year-over-year, the biggest spike of all 35 cities surveyed.
The numbers are part of Rentals.ca Rent Report, which discovered that the average rent for all Canadian properties listed on Rentals.ca in January was $1,807 per month, up 4.4 per cent annually and 1.0 per cent monthly. The average rental rate in January of this year remains below the $1,879 per month average in January 2020 and the $1,855 per month average in January 2019.
Many municipalities across Canada are experiencing substantial annual increases in average rent, which must be viewed in light of the fact that average rents fell off a cliff during the worst of the pre-vaccine pandemic, so comparisons this year will skew high.
The average rental rate for a single-family home in January 2022 was $2,652, up 3.2 per cent monthly from December’s average rent of $2,570, and nearly 20 per cent above last January’s average of $2,215.
Condominium apartments in January 2022 moved from $2,227 per month in December 2021 to $2,256 per month in January 2022, a month-over-month increase of just 1.3 per cent but an annual increase of 13.8 per cent.
The average rental rates for apartments increased month over month by 1.0 per cent from $1,622 in December 2021 to $1,639 per month in January 2022. When comparing to January 2021, average rents for apartments have increased by 2.1 per cent.
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Average rent has increased for one, two, and three bedrooms both month over month and year over year.
One-bedroom units have moved from $1,567 in December 2021 to $1,574 in January 2022, a monthly increase of less half a per cent, while the annual increase was 3.3 per cent, making Oshawa’s spike even more remarkable.
Two-bedroom units have moved from $1,919 in December 2021 to $1,941 in January 2022, a monthly increase of 1.1 per cent. Two-bedroom units have also increased 6.2 per cent annually from $1,828 in January 2021. Oddly, average prices for two-bedroom units in Oshawa are $1,739, which is less expensive than the one-bedrooms.
Three-bedroom units have moved from $2,287 in December 2021 to $2,328 in January 2022, a monthly increase of 1.8 per cent. Three-bedroom units have also increased 7.7 per cent annually from $2,161 in January.
On an absolute basis, rents for larger units are appreciating faster, but when you control for the unit sizes, all bedroom types are increasing at a similar rate of 4-5 per cent year over year.
In January 2022, the average rent per-square-foot for a condominium apartment in Downtown Toronto was $3.70. Since January 2021, the average rent per-square-foot has gradually moved up, increasing annually by 19 per cent. This follows an unprecedented single-year decline of 21 per cent from January 2020 to January 2021.
The downtown market remains well below the rent levels from two years ago, with current rents about 6 per cent below previous peak levels.
The rest of the GTA followed a similar pattern with the average rent per-square-foot steadily increasing throughout 2021 from $2.90 per square foot in January 2021 to $3.27 per square foot in January 2022 – an annual increase of 12.8 per cent. Rents outside the downtown core have now returned to pre-pandemic levels.
After the typical seasonal decline in December, average rental rates in Canada have started to trend up again. The fear that the Omicron variant would derail the economy and lockdown the country again has subsided, with tenants again out looking for a place to rent.
The largest growth continues to be for single-family rentals, as many potential buyers choose to rent, fearing the ownership market has gotten too ‘frothy.’ Potential government intervention in the ownership market and future interest rates hikes play into their decisions to rent. The second reason single-family rentals are rising is an increase in investor activity in a more upscale single-family product, which necessitates higher rents.
In Toronto, the downtown core was hit the hardest by the pandemic as the average per-square-foot rents declined at a quicker rate than the rest of the GTA. This premium has begun to widen again, with the average per-square-foot rents in Downtown Toronto increasing at a quicker rate than the rest of the GTA. Bullpen Research & Consulting expects this trend to continue moving forward, as tenants begin slowly returning to the office.
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