Renters in Metro Vancouver are facing an uphill battle as they navigate rising prices and one of the lowest vacancy rates in Canada.
That’s according to a new report from the Canada Mortgage and Housing Corp. (CMHC) that shows vacancy rates for the region remained unchanged last year at 0.9 per cent when compared with 2022.
The average turnover rate for all bedroom types fell to 8.1 per cent in 2023 from 10.7 per cent the year prior, the Jan. 31 report said. A rental unit is considered “turned over” if it was occupied by a new tenant who moved in during the 12-month survey period.
“I would say Vancouver's rental market is probably the toughest market in the country,” said Braden Batch, a senior economist with the Crown corporation.
“We really rely on people breaking their leases, finding better accommodation and a churn inside the market. So when you see that turnover rate fall, lots of things aren't able to happen because of that. It paints the picture of a really seized-up market, nobody's moving and everybody's staying put.”
Average two-bedroom rent in a purpose-built rental building increased by 8.6 per cent to $2,181, with average rent for the same type of unit in a standard condo building reached $2,580 in 2023.
Factors such as population growth driven by immigration and rising mortgage rates that delayed plans for first-time buyers are keeping downward pressure on vacancy rates. These factors led the CMHC to deem Metro Vancouver the “tightest major market” in Canada in its report.
Home sales last year were 23.4 per cent below the 10-year average, according to the Real Estate Board of Greater Vancouver.
Though the CMHC does not have data on population growth for the second half of 2023, its report found international migration to the province increased by 56 per cent in the first half of the year when compared with the same time in 2022.
Purpose-built rental supply increased by 2.7 per cent or 3,144 units throughout 2023. Most of the increase was seen in one-bedroom units from new developments in Vancouver and Surrey, according to the Crown corporation.
“Areas such as southeast Vancouver, the Tri-Cities and Surrey are expected to see the largest growth in rental supply in the near future,” said the report.
