Are we beginning to see some rent relief?

By Staff

January 9th, 2025

BURLINGTON, ON

Average asking rents for all residential property types in Canada dropped 3.2% in 2024, reaching a 17-month low of $2,109 in December. The decline in 2024 follows rent growth of 8.6% in 2023 and 12.1% in 2022, making this the first annual rent decrease since the COVID-19 pandemic in 2020.

Despite the recent drop, rents remain up 16.8% over the past five years.

The rental market softened across most parts of the country last year.

Current trends suggest rents may experience further decreases in 2025.

The rental market softened across most parts of the country last year following record-breaking growth in 2022 and 2023 and amid multi-decade highs for apartment completions, slowing population inflows, and a weakening economy,” said Shaun Hildebrand, President of Urbanation. “Current trends suggest rents may experience further decreases in 2025, which so far have been focused on secondary market units. However, any rent declines should be temporary and remain minimal mostly due to a long-term undersupply of rental units in the country, with rents set to accelerate in the coming years as the current slowdown in construction works to restrict supply.”

Purpose-built rentals remained stable, with a slight 0.3% decline in average rents to $2,070, while townhouse and house rentals experienced the steepest drop, falling 7.4% to $2,181.

Studios were the only unit type to see rent growth, rising 1.7% to $1,591. Rents for one- and two-bedroom units declined 1.1% and 0.3%, respectively.

Ontario: Rents experienced the steepest provincial decline, down 4.7% annually to $2,332, driven by decreases in one- and two-bedroom units. The average asking rent for shared accommodations decreased 1.9% annually to $986. Toronto saw the largest decline, with shared rents dropping 9.0% to $1,194, while Vancouver and Ottawa saw increases of 4.0% and 4.9%, respectively.

Rentals.ca Network data is analyzed and the report is written by Urbanation, a Toronto-based real estate research firm providing in-depth market analysis and consulting services since 1981.