The average rental apartment vacancy rate in Canada’s 35 major centres increased to 2.8 per cent in October 2009 from 2.2 per cent in October 2008. The centres with the highest vacancy rates in 2009 were Windsor (13.0 per cent), Abbotsford (6.1 per cent), Peterborough (6.0 per cent), Calgary (5.3 per cent), and London (5.0 per cent). On the other hand, the major urban centres with the lowest vacancy rates were Regina (0.6 per cent), Québec (0.6 per cent), St. John’s (0.9 per cent), Winnipeg (1.1 per cent), Kingston (1.3 per cent), and Victoria (1.4 per cent).

Demand for rental housing in Canada decreased due to slower growth in youth employment and improved affordability of homeownership options. Rental construction and competition from the condominium market also added upward pressure on vacancy rates.

The highest average monthly rents for two-bedroom apartments in new and existing structures were in Vancouver ($1,169), Calgary ($1,099), Toronto ($1,096), and Ottawa ($1,028). The lowest average monthly rents for two-bedroom apartments in new and existing structures were in Saguenay ($518), Trois-Rivières ($520), and Sherbrooke ($553).

Year-over-year comparison of rents in new and existing structures can be slightly misleading because rents in newly-built structures tend to be higher than in existing buildings. However, by excluding new structures, we can get a better indication of actual rent increases paid by most tenants. The average rent for two-bedroom apartments in existing structures increased in all major centres. The largest rent increases in existing structures were recorded in Regina (10.2 per cent), Saskatoon (8.3 per cent),Victoria (5.0 per cent), and St. John’s (4.9 per cent). Overall, the average rent for two-bedroom apartments in existing structures across Canada’s 35 major centres increased by 2.3 per cent between October 2008 and October 2009.

CMHC’s October 2009 Rental Market Survey also covers condominium apartments offered for rent in Calgary, Edmonton, Montréal, Ottawa, Québec, Regina, Saskatoon, Toronto,Vancouver, and Victoria. In 2009, vacancy rates for rental condominium apartments were below two per cent in seven of the 10 centres surveyed. Rental condominium vacancy rates were the lowest in Toronto, Saskatoon, and Ottawa. However, Regina and Edmonton registered the highest vacancy rates for condominium apartments at 3.0 per cent and 3.1 per cent in 2009, respectively.

The survey showed that vacancy rates for rental condominium apartments in 2009 were lower than vacancy rates in the conventional rental market in Ottawa, Saskatoon,Vancouver, Toronto, Edmonton, and Calgary. The highest average monthly rents for two- bedroom condominium apartments were in Toronto ($1,487),Vancouver ($1,448), Calgary ($1,310), and Victoria ($1,223). All surveyed centres posted average monthly rents for two- bedroom condominium apartments that were higher than average monthly rents for two-bedroom private apartments in the conventional rental market in 2009.

Funding of $742,000 for 14 new affordable housing rental units for seniors living on a low income was announcement today in Tavistock.

Dave MacKenzie, Member of Parliament for Oxford, on behalf of the Honourable Diane Finley, Minister of Human Resources and Skills Development and Minister Responsible for Canada Mortgage and Housing Corporation (CMHC), and Khalil Ramal, Member of Provincial Parliament for London – Fanshawe on behalf of the Honourable Jim Watson, Ontario’s Minister of Municipal Affairs and Housing; along with Paul Holbrough, Warden of Oxford County and Don McKay, Mayor of East Zorra – Tavistock, made the announcement.

“The Government of Canada is helping Canadians during these tough economic times and giving hope to seniors who need quality, affordable housing that meets their needs,” said MP MacKenzie. “This investment is possible through Canada’s Economic Action Plan, the federal government’s plan to stimulate the economy and create jobs during the global recession. For Ontario, this includes a $1.2 billion joint investment.”

“New housing initiatives add significant support to the McGuinty government’s Poverty Reduction Strategy,” said MPP Ramal. “We will continue to work with our federal and municipal partners to ensure new affordable housing units are built during the life of this program.”

“Oxford County is very proud of the new affordable housing project in Tavistock,” said Warden Holbrough. “This project is an example of private enterprise partnering with public money to fulfill the needs of Tavistock. The identified need to provide affordable housing for seniors will allow seniors to live in an environment close to services they need.”

“The conversion of this Historic building, to Affordable Housing for seniors, is a most welcomed addition to the Tavistock Community,” said Mayor McKay.

The Government of Canada wants to ensure that Canadians on fixed incomes can live with independence and dignity and remain in their communities, close to family and friends. Canada’s Economic Action Plan provides $400 million, over two years, to build new rental housing for low-income seniors. Overall, the Economic Action Plan includes $2 billion for new and existing social housing, plus up to $2 billion in loans to municipalities for housing-related infrastructure.

Canada’s Economic Action Plan builds on the Government of Canada’s commitment in 2008 of more than $1.9 billion, over the next five years, to improve and build new affordable housing and help the homeless.

Today’s announcement celebrates the funding for 14 new affordable rental units for seniors at 40 Woodstock Street.

The average rental apartment vacancy rate in Canada’s 35 major centres increased to 2.8 per cent in October 2009 from 2.2 per cent in October 2008, according to the Rental Market Survey released today by Canada Mortgage and Housing Corporation (CMHC).

“Demand for rental housing in Canada decreased due to slower growth in youth employment and improved affordability of homeownership options”, said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “Rental construction and competition from the condominium market also added upward pressure on vacancy rates.’

Between October 2008 and September 2009, 15,657 rental units and 45,655 condominium units were completed in Canada’s 35 major centres. Condominiums are a relatively inexpensive type of housing for renters moving to home ownership. Also, some condominium apartments are owned by investors who rent them out.

Provincial vacancy rates in October 2009 increased in eight out of ten provinces. The largest increases were in Alberta where the vacancy rate increased by 3 percentage points to 5.5 per cent and British Columbia where the vacancy rate rose by 1.8 percentage points to 2.8 per cent. Vacancy rates decreased by 0.1 of a percentage point in Newfoundland and Labrador to 1.0 per cent, and by 0.4 of a percentage point in Nova Scotia to 3.1 per cent.

The centres with the highest vacancy rates in 2009 were Windsor (13 per cent), Abbotsford (6.1 per cent), Peterborough (6.0 per cent), Calgary (5.3 per cent), and London (5.0 per cent). On the other hand, the major urban centres with the lowest vacancy rates were Regina (0.6 per cent), Québec (0.6 per cent), St. John’s (0.9 per cent), Winnipeg (1.1 per cent), Kingston (1.3 per cent), and Victoria (1.4 per cent).

The highest average monthly rents for two-bedroom apartments in new and existing structures were in Vancouver ($1,169), Calgary ($1,099), Toronto ($1,096), and Ottawa ($1,028). The lowest average monthly rents for two-bedroom apartments in new and existing structures were in Saguenay ($518), Trois-Rivières ($520), and Sherbrooke ($553).

Year-over-year comparison of rents in new and existing structures can be slightly misleading because rents in newly-built structures tend to be higher than in existing buildings. However, by excluding new structures, we can get a better indication of actual rent increases paid by most tenants. The average rent for two-bedroom apartments in existing structures increased in all major centres. The largest rent increases in existing structures were recorded in Regina (10.2 per cent), Saskatoon (8.3 per cent), Victoria (5.0 per cent), and St. John’s (4.9 per cent). Overall, the average rent for two-bedroom apartments in existing structures across Canada’s 35 major centres increased by 2.3 per cent between October 2008 and October 2009.

CMHC’s October 2009 Rental Market Survey also covers condominium apartments offered for rent in Calgary, Edmonton, Montréal, Ottawa, Québec, Regina, Saskatoon, Toronto, Vancouver, and Victoria. In 2009, vacancy rates for rental condominium apartments were below two per cent in seven of the 10 centres surveyed. Rental condominium vacancy rates were the lowest in Toronto, Saskatoon, and Ottawa. However, Regina and Edmonton registered the highest vacancy rates for condominium apartments at 3.0 per cent and 3.1 per cent in 2009, respectively.

The survey showed that vacancy rates for rental condominium apartments in 2009 were lower than vacancy rates in the conventional rental market in Ottawa, Saskatoon, Vancouver, Toronto, Edmonton, and Calgary. The highest average monthly rents for two-bedroom condominium apartments were in Toronto ($1,487), Vancouver ($1,448), Calgary ($1,310), and Victoria ($1,223). All surveyed centres posted average monthly rents for two-bedroom condominium apartments that were higher than average monthly rents for two-bedroom private apartments in the conventional rental market in 2009.

CMHC’s Rental Market Survey also gathers information on monthly rents in types of dwellings other than private apartments and condominium apartments, such as duplexes, and accessory apartments for 15 major centres.

The Rental Market Report for major centres also includes an affordability indicator for most centres. The rental affordability indicator is used to examine trends in rental affordability within a centre.

CMHC’s Rental Market Survey is conducted twice a year, in April and in October, to provide vacancy rate and rent information on privately initiated apartment structures containing at least three rental units. However, due to possible seasonal factors, the April and October results are not compared.

As Canada’s national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions.

Funding of $4.7 million for 52 new affordable housing rental units for seniors living on low income was announced today in London.

Ed Holder, Member of Parliament for London West, on behalf of the Honourable Diane Finley, Minister of Human Resources and Skills Development Canada and Minister Responsible for Canada Mortgage and Housing Corporation (CMHC), and the Honourable Chris Bentley, Attorney General and Member of Provincial Parliament for London West on behalf of the Honourable Jim Watson, Ontario’s Minister of Municipal Affairs and Housing; along with David Winninger, Councillor on behalf of Anne Marie DeCicco-Best, Mayor of the City of London, made the announcement.

“The Government of Canada is helping Canadians during these tough economic times and giving hope to seniors who need quality, affordable housing that meets their needs,” said MP Holder. “This investment is possible through our government’s Economic Action Plan, that is stimulating the economy and creating jobs during the global recession. For Ontario, this includes a $1.2 billion joint investment.”

“New housing initiatives add significant support to the McGuinty government’s Poverty Reduction Strategy,” said MPP Bentley. “We will continue to work with our municipal partners to ensure more units are built during the life of this program.”

“This multi-level funding is very important to all Londoners, especially our seniors, as we continue to work together to combat homelessness, through the provision of decent affordable housing in our community,” said Mayor Anne Marie DeCicco-Best.

The Government of Canada wants to ensure that Canadians on fixed incomes can live with independence and dignity and remain in their communities, close to family and friends. Canada’s Economic Action Plan provides $400 million, over two years, to build new rental housing for low-income seniors. Overall, the Economic Action Plan includes $2 billion for new and existing social housing, plus up to $2 billion in loans to municipalities for housing-related infrastructure.

Canada’s Economic Action Plan builds on the Government of Canada’s commitment in 2008 of more than $1.9 billion, over the next five years, to improve and build new affordable housing and help the homeless.

With some 1,850 new homes expected to be started in both 2009 and 2010, new home construction is expected to remain relatively stable. This is mostly due to a weak rebound of single-detached home construction,which is expected to increase by only 50 units from the 2009 level.

The weak rebound in single-detached home construction is mostly due to competition from the resale market, especially from the nearly new category (homes of 1-5 year vintage). Strong growth in new single-detached home construction before 2006 created a large stock, and some of them are being offered for sale in the resale market. These homes are very popular among doctors, nurses or other health care or natural sciences related professionals. During the past few years, they tended to purchase new from builders because the resale market was tight. However, with a larger offering of nearly new homes on the market, they tend to find what they want in the resale market. With listings of resale homes expected to remain high, these professionals will tend to purchase from resale than directly from builders.

There are reports that some builders may be building up inventories in order to better compete with the resale market, by being able to have homes ready for customers to move into as soon as the transaction closes. However, at the end of September, the level of completed and unabsorbed homes dropped to 99 units, down from nearly 200 units earlier this year.

Apartment construction will be relatively strong in 2009 and 2010. Overall apartment starts will reach 850 units in 2009, and 800 units in 2010.Many of them will continue to be in the high-end rental category. Empty nesters and retirees who like the convenience of an apartment lifestyle are the key customer group for these apartments.

Condominium apartments are also becoming a factor in the London housing market. The popularity of high-end rental apartments among empty nesters and retirees has resulted in some showing interest in ownership. Developers are beginning to build high rise condominiums to satisfy this demand.

London, Ontario - Credit abdallahh, Flickr

The London Ontario rental vacancy rate has moved up to 3.9% in 2008 and Canada Mortgage and Housing Corporation is predicting that the vacancy rate will rise to 4.2% in 2009. For a city the size of London Ontario, this means that a tenants market for rental units has returned to the London Ontario area.

It is good times now for tenants in London Ontario to find good rental accommodations at reasonable rents, as line-ups at landlord’s offices is over.

SLIGHT COOLING OFF OF THE LONDON RENTAL MARKET

The London rental market has cooled off slightly and the vacancy rose to 3.9% in 2008 from 3.6% in 2007. The average rent on rental units increased by 1.5% in 2008 form the 2007 rental rate figures, which was slower than the 2.6% increase in 2007, from the 2006 rental period.

The rental vacancy rate increased in the surrounding communities i.e. St. Thomas and Strathroy substantially, which affected the overall vacancy rates. Canada Mortgage and Housing Corporation is predicting that the overall vacancy rate in London will increase to 4.0% for the period ending 2009.

SEVERAL REASONS FOR CONTINUED INCREASE IN VACANCY RATE

The Canada Mortgage and Housing Corporation report states that many factors have combined to increase the vacancy rate in London. Some of those factors include a surprising decrease in university students and huge unemployment increases. As well as the substantial increase in the creation of rental units, which increased to 836 units in 2008, versus 586 in 2007.

CONTINUED MODERATE RENT INCREASES

The Canada Mortgage and Housing Corporation report states that last fall in London Ontario, a one-bedroom apartment that used to rent for $554.00, plus utilities is now renting for $565.00, plus utilities, compared to the same period last year. A two-bedroom unit that rented last year for $625.00, plus utilities, is now renting for $645.00, which is approximately a 1.5% increase.

Government sources say that with these moderate increases, welfare recipients are not hard pressed to rent in London Ontario. Increased vacancy rates in this area of the province have caused rents to increase moderately for the same period last year. However, rent increases in purpose-built apartment rent units that were new, were more significant in most areas of the City of London Ontario.

RENTERS PREFER LARGER AND NEWER BUILDINGS

Canada Mortgage and Housing Corporation report states that apartment buildings with excess of 100 units or more have the lowest average vacancy rate in London Ontario at 2.9%. Rental apartments constructed after 2000 are becoming popular and preferred by the London area tenants, specifically in the downtown core.

LONDON’S RENTAL AFFORDABILITY INDICATOR

Canada Mortgage and Housing Corporation affordability indicator will decline to 119 by year-end 2008, which indicates that the value of 100 suggests that 40% of the median income of rental households is necessary to rent a two bedroom apartment, well above the Canadian average.

NATIONAL VACANCY RATE DECREASED IN OCTOBER 2008

Canada Mortgage and Housing Corporation reports that the vacancy rate in Canada’s 34 major centers decreased to 2.2% from 2.6% in October of 2008, for the same period the year before. Vacancy rates were as high as 14.6% in Windsor to a low of 0.3% in Vancouver and Abbotsford BC.

Canada Mortgage and Housing Corporation reports that the highest average monthly rent for a two bedroom apartment is in Calgary, Alberta with a monthly rental cost of $1,148.00 to a low of $543.00 in Sherbrooke, Quebec.

You can find the entire report in PDF format through the following link:
http://www.cmhc-schl.gc.ca/odpub/esub/64403/64403_2008_A01.pdf

London, Ontario - Credit b0ratDI, Flickr

London Ontario has had a small decrease in housing starts and is returning to the historical low levels of housing starts of years gone by and the housing starts are down 29%. CMHC is forecasting 732 units single-detached starts, 15 semi-detached units, 10 apartment condominium ownership units, and 10 apartment rental units, for a total of 767 housing starts for 2008. This will decrease by 400 units in 2009.

SINGLE-DETACHED FORMS OF HOUSING POISED FOR ANOTHER STRONG YEAR

This year Canada Mortgage and Housing Corporation predicts that London Ontario will surpass the housing start levels of 2006, and 2007 by pouring more than 700 foundations. However, in 2009 Canada Mortgage and Housing Corporation predicts that there will be only 400 single-detached homes started, a decrease of 29% from 2008.

LONDON’S RESALE MARKET WILL BE MODERATE

Canada Mortgage and Housing Corporation states in its outlook report that after 6 years of consecutive double-digit price growth, the resale market in London will balance itself off in 2009. In 2007, the average MLS price for a detached home is currently $205,000.00 in 2008 and we will see a 2.5% increase in 2009, to push the resale average price to $211,000.00.

LONDON MARKET TIPS INTO BALANCED CONDITION

As London Ontario has experienced substantial price growth over the past 3 years, Canada Mortgage and Housing Corporation predicts that there will be continued but moderate growth in 2009. However, in major commercial projects there will be over $15 million worth of projects that are commencing in 2009 for London and the surrounding areas, concentrated in London Ontario.

MORTGAGE RATES

Canada Mortgage and Housing Corporation predict that interest rates will decline by a further 25-50 basis points from their current levels in 2009. However, due to the cost of borrowing to the Canadian banks from the markets, the mortgage interest rate will marginally increase in the latter half of 2009, but not significantly enough to negatively affect the housing market in London and surrounding areas.

You can find the entire report in PDF format through the following link:
http://www.cmhc-schl.gc.ca/odpub/esub/64327/64327_2008_B02.pdf