Aug 11, 2022
Housing affordability continues to deteriorate for Canadian tenants amid across-the-board increases in rent rates, according to the latest data from the Canada Mortgage and Housing Corporation.
The average rent for a two-bedroom home across Canada increased to $1,167 in 2021, representing a 3% rise from $1,128 in 2020 and $1,080 in 2019. This trend was impelled by a supply-demand imbalance and by the different speeds that markets have recovered from the worst effects of the pandemic, said Bob Dugan, chief economist at the CMHC.
The increases were most prominent in Vancouver (up 2.4% to $1,824) and the Greater Toronto Area (up 1.5% to $1,666).
“When you look at lower income households the mismatch between affordable rentals and the number of households gets worse,” Dugan said. “Last year in Toronto and Vancouver, only 0.2% of the rental [segment] was affordable for the bottom 20% of earners.”
Per CMHC’s calculations, a tenant in a two-bedroom purpose-built apartment would have to work 198 hours per month in Vancouver and 178.3 hours in the GTA to keep the monthly rent at 30% of gross income, the level that the Crown corporation considers the threshold of affordability.
“That person has to work more than full-time or needs a second tenant in the unit with them to make that rent affordable, if they’d like to get it down to 30% of income,” Dugan said. “That’s an even bigger mismatch, when you get to that bottom 20% [of earners], so that’s something that’s a concern to us.”
The national rental vacancy rate stood at 3.1% in 2021, versus 3.2% in 2020 and 2.2% in 2019.