The cost of accommodation in Canada varies by city and vacancy rates are a key driver of costs. Housing costs are usually the largest portion of a monthly budget, and if you’re a newcomer to Canada, it’s helpful to understand what determines accommodation costs. With this knowledge, you can decide where you want to live and how much you can afford. Other factors that affect the cost of accommodation include the location, type of housing, and size.
What Does Vacancy Rate Mean?
In Canada, the vacancy rate refers to the housing supply and the occupancy rate refers to the housing demand. Though the answer is subjective, a healthy vacancy is considered to be around 3% in general.
The Canada Mortgage and Housing Corporation (CMHC) conducts the Rental Market Survey (RMS) every year in October in urban areas with populations of 10,000 and more. The RMS estimates the strength of the rental market. The survey targets privately rented structures with at least three rental units, that have been on the market for at least three months.
The CMHC also conducts the Condominium Apartment Survey (CAS) every year in September to estimate the strength of the condo apartment rental market. The cities covered in this survey are Calgary, Edmonton, Gatineau, Halifax, Hamilton, Kelowna, Kitchener, London, Montréal, Ottawa, Regina, Saskatoon, Toronto, Vancouver, Victoria, and Winnipeg.
How Vacancy Rates Affect the Cost of Accommodation in Canada
A vacancy rate of two percent or lower means that there is greater competition among prospective tenants as they vie for fewer vacant rental properties. At three percent, the vacancy rate represents a healthy balance between supply and demand.
Vacancy rates above four percent represent a “renter’s market” with greater supply than demand and lower housing costs.
The vacancy rate is also a key factor that determines the cost of accommodation in cities across Canada. With this in mind, you can research vacancy rates to understand rental costs, determine how much you can afford, and budget for rent. Here are the 2022 vacancy rates and average rental rates for a 2-bedroom apartment in several Canadian cities:
City Vacancy Rates
|Average Rental Cost for a|
Less than 2%
– High demand with a limited housing supply
– Drives rental cost higher.
– Balance of housing supply and demand.
St. Catharines 2.8%
St. Catharines $1,260
|Greater than 3%|
– High supply with low demand
– Drives rental cost lower
– “Renter’s market”.
How Much Do Apartments Cost in Canada?
Finding affordable housing continues to be a challenge, especially in Toronto and Vancouver where vacancy rates are below two percent. That’s why we encourage newcomers to consider other cities that often offer hidden advantages to newcomers, including lower accommodation costs.
What’s Affordable Housing in Canada?
Housing affordability and supply are essential areas to explore when you evaluate your landing city options. In Canada, spending less than 30% of your pre-tax income on housing is considered affordable. Spending more than 30% on housing will mean cutting into your budget for things like food, transportation, and other necessities. And, until you establish stable finances, it’s wise to manage your budget and expenses accordingly.
Where to Find Affordable Accommodation in Canada?
Major cities like Toronto and Vancouver are expensive when it comes to accommodation. However, you’ll likely find housing prices that are more in line with your budget in other Canadian cities. Carefully researching small and mid-sized cities across Canada before you choose your landing city is the key to your success.
Research the Housing and Job Markets in Different Cities
It’s important to research housing and job markets across Canada. Canada is a vast country with regional, economic, and cultural differences. And, the cost of housing (both in the rental and homebuying markets) can vary widely. At the same time, you want to research your profession in different cities to ensure there are job opportunities that match your skills, knowledge, and experience.
This initial research is critical. While it’s always possible to relocate from your landing city to other cities, making a secondary move can be quite expensive. Carefully evaluating your landing city options, housing costs, and career options will help you to make smart decisions that will influence your financial success. You can easily check out rental costs in cities across Canada at Rentals for Newcomers.
Become Familiar with the Cost of Living in Different Cities
The cost of living can vary across Canada. Things like groceries, transportation, rent, or home-buying costs can be expensive. Also, consider your lifestyle and the cost of entertainment and dining out.
When you consider all of these factors it will help you to budget for the cost of accommodation in Canada. And for newcomers, this information can help you to make smart and affordable landing city decisions!