CREB® 2017 ECONOMIC RENTAL OUTLOOK
Based on the most recent CMHC rental market survey, 2016 purpose-built apartment vacancy rates reached new highs at seven per cent. The main contributors were new rental supply, job losses, high unemployment rates and an outflow of migrants from the city.
Higher vacancy rates placed downward pressure on rental rates, with estimated declines of 7.5 per cent for two-bedroom purpose-built units in 2016.
The secondary rental market measured by CMHC is primarily focused on condominium apartments. Based on its survey, more
than 30 per cent of condominium apartments are identified as rented units. The surveyed vacancy rate in this segment of the market remained unchanged from the last survey as it is expected that renters will be incentivized by improved services and a more than 12 per cent drop in rental rates.
Elevated supply in the rental market can influence investor ownership
demand. Higher vacancy levels and lower rental rates may impact expected returns. As vacancies start to ease and rental rates stabilize over the next several years, interest from investors could improve.
In the meantime, higher volume of rental supply, combined with more stringent ownership qualifications, could limit ownership demand growth from first-time buyers.
CREB January 11, 2017 Release – DARYL CARLSON RE/MAX Realty Professionals
Please email, text or call, if you have any questions. (403) 650 – 7400 darylcarlson@shaw.ca
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