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Metro Vancouver’s Apartment Vacancy Rate Decreases
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(Posted on Nov 29, 2016 at 03:15PM by Michelle Bogle)
According to a recent report from the Canada Mortgage and Housing Corporation, the vacancy rate across the Vancouver Census Metropolitan Area (CMA) has decreased from 0.8% in October 2015 to 0.7% a year later.
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“Strong demand for rental accommodation in Vancouver outpaced additions to supply, pushing rents higher and vacancies lower for purpose-built and condo rental apartments,†said CMHC Principal of Market Analysis, Robyn Adamache.
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The report also said that a strong job market is driving rental demand, particularly for younger demographics that tend to start off as renters. According to the report, Vancouver CMA continues to lead employment growth nationally, at a pace of 5.8% year-over-year as of September 2016, based on data from Statistics Canada. This equates to more than 70,000 additional jobs created, compared to the same period last year.
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Solid employment in the region is also driving demand by increased migration to the province. Vancouver CMA added an estimated 15,773 new households between 2015 and 2016. This population-based demand is one of the main factors contributing to low vacancy rates.
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What is also important to note is that this rental vacancy decrease isn’t only occurring in the City of Vancouver – according to the report, vacancy actually increased slightly in Vancouver. In the Downtown/West End area, the rate increased from 0.5% to 0.6%. In the rest of the city, the rate grew from 0.6% to 0.8%.
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The region’s tightening vacancy rate was driven by declining availability in the suburbs, with the most drastic drop in Surrey. Last October, Surrey had an apartment vacancy rate of 1.9%; this year, the rate plunged to 0.4%. Vacancy also fell in Burnaby (October 2015: 1.2%, October 2016: 0.8%) and New Westminster (October 2015: 0.9%, October 2016: 0.4%).
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And, as apartment rental vacancies continue to drop, the average rents across the region continue to climb. According to the CMHC:
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• The average rent in the Vancouver CMA increased from $1,144 in October last year to $1,223 this year – an increase of 6.4%.Â
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• Rents also increased across all regions, with Vancouver’s West End/Downtown area seeing a jump from $1,350 to $1,461.Â
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• In the rest of Vancouver, average rent increased from $1,233 to $1,324.Â
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• Rent increased in Burnaby (October 2015: $1,031, October 2016: $1,105) and New Westminster (October 2015: $933, October 2016: $993).
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For more information regarding the CMHC’s Fall Rental Market Survey or to learn more about multi-family investment opportunities across the Lower Mainland, please contact our Vancouver office to speak with a commercial real estate associate.
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