Vancouver’s vacancy rate drops to under 1% in 2022: CMHC

The search for a place to live in Vancouver just got more difficult, as the city's rental vacancy rate has fallen to 0.9 per cent this month. Kier Junos finds out what this means for both current and prospective renters.

If it feels like it’s become even harder to find a rental in Metro Vancouver, you’re not making it up.

According to the Canadian Mortgage and Housing Corporation (CMHC), Vancouver’s rental vacancy rate dropped to under one per cent at the end of last year.

In its latest Rental Market Report, the housing corporation says the rate in the region decreased from 1.2 per cent in 2021 to 0.9 per cent in 2022.

“Higher homeownership costs and migration to the region led rental demand to increase faster than supply,” the report says.

It comes as the national vacancy rate has dropped to its lowest levels in 23 years, with CMHC saying it’s due to “widespread tightening across the country, including in Canada’s three largest rental markets,” Montreal, Vancouver, and Toronto.

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CMHC says the overall national vacancy rates for purpose-built rentals have decreased from 3.1 per cent to 1.9 per cent in 2022.

According to the housing corporation, Toronto saw the sharpest drop, from 4.4 per cent in 2021 down to 1.7 per cent in 2022.

“Lower vacancy rates and rising rents were a common theme across Canada in 2022. This caused affordability challenges for renters, especially those in the lower income ranges, with very few units in the market available in their price range,” Bob Dugan, CMHC’s chief economist, said. “The current conditions reinforce the urgent need to accelerate housing supply and address supply gaps to improve housing affordability for Canadians, as stated in our report.”

Vancouver’s average condo rental passes $2,500 per month

The report notes that only one per cent of rentals within Vancouver and Victoria are “affordable to renters with the lowest 20% of incomes.”

In Vancouver, purpose-built rentals are renting for an average of $2,002 per month, with rental condos renting on average for $2,504 a month.

However, regardless of the size of the rental, those that are already occupied within the city are renting for an average of $1,658 per month, and those on the market renting for $2,373.

The report also notes that high-interest rates, which are in turn raising mortgage payments, are making it harder and “less attractive” for renters to move into ownership.

“The overall average rent growth for two-bedroom purpose-built apartments common to 2021 and 2022 surveys was 5.6%. This is a new annual high, well-above-average rent growth recorded between 1990 and 2022,” the report said, adding the average two-bedroom rental apartment rose from $1,771 per month to $1,930.

Meanwhile, Victoria bucked the national trend and saw its vacancy rate rise slightly from one per cent in 2021 up to 1.5 per cent in 2022.

“Record high supply growth has helped alleviate rental market tightness, while rising demand has accelerated rent increases in the Victoria rental market,” the report notes.

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