Calgary region sees declining rental apartment vacancy rate

The rental apartment vacancy rate in the Calgary region continues to fall.

Vacancy was one per cent in October, down from 1.3 per cent last year, in the Calgary census metropolitan area, according to the Fall Rental Market Survey released Thursday by Canada Mortgage and Housing Corporation.

“As was the case in recent years, the rental market in Calgary has continued to tighten. The vacancy rate declined for the fourth consecutive year,” said Richard Cho, senior market analyst in Calgary for the CMHC. “Calgary’s labour market continues to attract migrants from other regions in Canada and other countries. We are expecting net migration to reach another record high this year. Demand for rental units has also come from people who were impacted by the flooding earlier this year, and from gains in youth employment.

“The supply in the purpose-built rental market universe has also declined, which has also contributed to the decline in the vacancy rate. Moving forward, we are expecting to see similar conditions next year, with the vacancy rate edging higher to 1.2 per cent. Movement into homeownership, competition from the secondary rental market, and a moderation in migration, will contribute to the slight increase.”

The CMHC said the average two-bedroom rent increased by 7.2 per cent in Calgary. One-bedroom units reported an increase of 7.7 per cent, while the fixed-sample rent for three-bedroom units rose 3.1 per cent year-over-year in October.

In new and existing structures, the average two-bedroom rent in the Calgary CMA was $1,224. The highest average two-bedroom rents were reported in the Downtown and Beltline, averaging $1,357 and $1,287 per month in October, respectively, said the report.

The CMHC survey included 33,933 apartment rental units, down from 34,212 a year earlier, and represented the 10th consecutive year that the apartment rental universe in the Calgary CMA has declined on a year-over-year basis.

“Additions to the supply of purpose-built rental units since the last survey were outpaced by condominium conversions, demolitions and units moving into social housing,” said the report. “Other removals which are temporary in nature, such as units undergoing renovations and repairs, have also contributed to the decline in the apartment rental universe in 2013.”

Gerry Baxter, executive director of the Calgary Residential Rental Association, said the association has seen the rental market tighten this year.

“It’s been tightening for the last couple of years,” said Baxter. “We’ve been noticing it. It’s continuing.”

But he said the city is still not as low as it was during the height of the boom a few years ago when the vacancy rate fell to 0.5 per cent.

“At least the decreases are more gradual than what we saw back in the boom time,” said Baxter. “For that I’m relieved and happy that that’s the way it’s gone because the last time was as hectic as anybody would see in a market.”

 

© Copyright (c) The Calgary Herald

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