The wait is over! View the September 2023 Rentsync National Rental Demand Report.
In this comprehensive national rental demand report, we outline significant changes in rental market demand across Canada. The data presented here is the largest data-backed analysis of rental market demand in Canada using aggregate ILS data (over 20 rental listing sites).
The data included in the Rentsync National Rental Demand Report can be used to compare and contrast demand and lead volume for the properties you manage within a given city, and will allow you to make more sound decisions on marketing and advertising.
As you observe demand and lead volume percentage, it's possible to measure this against your own metrics, and see whether you are in line with current industry trends, and if not, how to pivot your strategies as a result.
In order to present this data, Rentsync has determined three key calculations for each area of the report, they are as follows:
Demand Score: Our demand score is rated out of 10 (with 10 being the highest score a city can receive), and is calculated based on unique prospects, per property, per city, and compared against benchmark data from the past 12 months.
For example: Oshawa, ON received a demand score of 5.7 this month, versus 6.3 last month. Therefore, Oshawa experienced an decrease in demand (unique prospects per property) by 0.6 points this month.
Unique Prospects Percentage (% +/-): This is determined according to the year-over-year (YOY) or month-over-month (MOM) increase or decrease (aka the demand) in unique prospects per property / per city.
For example: The month-over-month unique prospects in Oshawa, ON went down 10% in February versus January. However, in February 2021, the year-over-year unique prospects in Oshawa, ON went up 60% compared to January 2020.
Position: The position is determined by unique prospects per property, with cities that have at least *20 properties or more. Position will vary depending on demand.
For example: This month, Oshawa remained in the #1 spot on the Top 50 Canadian Cities in Demand despite a slight decrease in month-over-month prospects per property (-10%), which could be attributed to the shorter month, and less cumulative days to collect prospect data (minus 3 days). Whereas Abbotsford, BC moved up 2 spots (from 5th to 3rd on the list), despite maintaining its demand score from last month.
*The following report provides month-over-month ILS data for February 2021 versus January 2021, as well as a year-over-year comparison from February 2021 versus February 2020. It also outlines the month-over-month and year-over-year trends in primary, secondary, and tertiary markets.
Month-over-month (M/M): Overall, total unique prospects from January to February decreased -7.5%, and number of available properties decreased -1.8%, however, this data was collected during a 28-day month versus a 31-day month, therefore the overall decline in unique prospects per property is likely attributed to this, and not necessarily attributed to a significant reduction in demand.
This month each market saw a relative decrease in unique prospects per property: Primary (-12.3%), Secondary (-10%), and Tertiary (-1.3%).
Interestingly, unique prospects per property in Secondary and Tertiary markets have toppled Primary. There are nearly double, +49.3% unique prospects per property in Secondary markets, and +34.7% unique prospects per property in Tertiary markets versus Primary this month.
*Overall, many Canadian cities will have experienced a decrease in demand from February 2021 versus January 2021, based on the reduced number of days in the month, and also due to government enforced lockdowns for the majority of February.
Year-over-year (Y/Y): Overall demand for multifamily rental housing is actually up +8.9% this year, versus the same time last year, however, supply is also up +30.7% with more than 2,862 new properties entering the long-term rental market this year versus the same time last year. Therefore, supply is outpacing demand nearly 3x this year versus last.
Primary markets are down (-35.6%), secondary markets are down (-21%), and tertiary markets are down (-25.2%) this year versus last year. It is worth noting that last year February 2020 had an additional day for data collection, which may be impacting the data. However, it is still clear that the pandemic has affected rental housing demand year-over-year, and lockdown measures throughout the winter months are causing many to postpone their rental housing search. As vaccines continue to roll out throughout the year, a surge in demand is likely to occur in later months.
Additionally, increased supply has impacted unique prospects per property across the majority of Canadian cities year-over-year. As more supply floods the market (i.e. Airbnbs), demand is being spread out.
We can hypothesize that this downward trend may begin to reach its final threshold as more people are vaccinated, and as travel and, schools, and restrictions begin to loosen. However, for the time being, we can expect COVID-19 to continue to impact migration away from urban city centers to locations with more space and more affordable housing, as remote work continues to increase.
*Demand is calculated using unique prospects per property per city for Feb 2021 versus Jan 2021
Key Trends for the Top 10 Canadian Cities in Demand (Y/Y)
*Note: It is worth mentioning that last year was a leap year, and February had an additional day in the month, and therefore should be accounted for when observing this data.
*It appears the increase in demand found in Oshawa, ON, and Abbotsford, BC, continue to be related to remote work and migration to less densely populated areas with reduced rent rates and larger living space. The decline in areas such as Welland, ON (-8%) and Peterborough, ON (-13%) are likely related to the shorter month, and appear to be on par from last year.
In order to better segment our data and analyze what is happening within specific markets across Canada, we have broken down our data into 3 key markets:
Here we will gain a deeper perspective on demand across larger populations, and any movement due to the impact of COVID-19 on the rental market.
*Demand in primary markets decreased this month versus last month. Overall, supply experienced no change in primary markets, however, demand decreased by -12.3% this month versus last month.
*No primary markets experienced any significant increase in demand this month versus last month
No Change in Demand
*Overall, month-over-month demand in primary markets from January to February were overall stable, except for North York, ON (-35% in unique prospects per property), who experienced a strong start to 2021, and was likely due to a marketing and advertising push in January. Overall, however, primary markets are indicating that it may be reaching its bottom, as rent rates have decreased throughout 2020 and into 2021. We may begin to see primary markets reemerge in later months as vaccines become more widespread and borders and travel reopens.
(See the year-over-year analysis below, for more perspective on demand in primary markets.)
*Overall, total unique prospects per property decreased -35.6% year-over-year in primary markets, while listings for rental properties are up 36% this year versus the same time last year in primary markets.
*Due to increased vacancies/availability, supply is outpacing demand in the majority of primary markets this year versus the same time last year.
*Certain primary cities such as Calgary, AB, Winnipeg, MB, and Edmonton, AB continue to be less impacted by the effects of COVID-19 on year-over-year demand due to less affected populations and spacious more affordable rental housing conditions. Scarborough, ON is beginning to see some return to normal rental market conditions despite COVID-19.
*However, major metros such as Toronto, ON and Montreal, QC continue to see fluctuating case numbers related to COVID-19, therefore it is not surprising that cities in these regions continue to see a downward trend in demand. Given that many workers have migrated away from these areas for the foreseeable future, a sudden resurgence in demand is unlikely until borders and travel reopens.
*After a strong start to the year, secondary markets saw a decrease of -10% in demand this month, with supply shrinking by -3.5% in these areas. However, given the short month, secondary markets are still positioned for strong month-over-month demand, with a question of whether supply will be able to offset continued demand.
*Overall, total unique prospects per property are down -21% in secondary markets this year, and supply is up +24.4% in secondary markets this year versus this time last year.
*Again, this month is 1-day shorter compared to last year, making the year-over-year decline in unique prospects per property appear larger. We will see a more accurate year-over-year depiction of secondary markets in next month's report.
*Overall, tertiary markets are extremely stable right now, and are seeing little to no change in demand month-over-month.
*Unique prospects per property decreased by -1.3% this month versus last month in tertiary markets, with a decrease of -1.9% in rental supply in these areas month-over-month.
(See the year-over-year analysis below, for more perspective on the rise in demand in tertiary markets.)
Abbotsford, BC remained at 3.6 in demand points, and saw a slight -2% decline in unique prospects per property this month versus last month.
*Due to a shorter month, along with COVID-19 related lockdowns, and an increase in supply in certain areas, some tertiary markets are seeing weakened demand in February. However, others are showing growth in demand this year versus last year.
*Overall, total unique prospects per property are down -25.2% this year versus the same time last year, and number of properties are up +20.2% this year versus the same time last year.
The data shown in this report shows that rental market demand has remained relatively stable in many Primary, Secondary, and Tertiary, cities month-over-month, and is showing normal shifts in demand due to the impact of COVID-19 shutdowns, in addition to February 2021 being a short month for measuring volume.
Additionally, there are notable year-over-year changes in demand in certain markets. Primary markets continue to indicate declining demand, where secondary and tertiary markets show relative stability year-over-year, and in some cases extreme growth, due to migration away from city centers. Areas with lower population and more affordable housing are seeing the greatest increase in demand.
We will continue to monitor, and provide an in-depth data analysis, month-over-month, and year-over-year to provide you with the most accurate insights that can help to support your ongoing marketing and advertising strategies, especially as we navigate through these unprecedented times.
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