Rentsync National Rental Demand Report: November 2020

Executive Summary

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. 

Methodology

NOTE: We have made improvements to our data and methodology in order to present the most accurate rental demand overview. Please see the definitions below to understand how our data is being collected, analyzed, and defined.

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 6.4 this month, versus 5.3 last month. Therefore, Oshawa experienced an increase in demand (unique prospects per property) by 1.1 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: In 2020, the month-over-month unique prospects in Oshawa, ON went up 17% in October versus September. In October 2020, the year-over-year unique prospects in Oshawa, ON went up 16% compared to October 2019 .

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 moved up 1 spot (from 2nd to 1st on the list) versus last month due to an increase in unique prospects per property by 17%. Whereas Surrey, BC moved down 1 spot (from 1st to 2nd on the list) versus last month due to a decrease in unique prospects per property by 17%.

*The following report provides month-over-month ILS data for October versus September 2020, as well as a year-over-year comparison from October 2020 versus October 2019.

Key Takeaways:

Month-over-month (M/M): Overall rental demand has only slightly decreased this month from the previous month, which remains consistent with data trends we have identified over a number of different platforms, and is due to a seasonal decline after summer.

Year-over-year (Y/Y): Overall demand across Canada is in line with annual seasonal trends, despite COVID-19.

Overall unique prospects per property for multifamily residential housing is actually up 16% this year, versus the same time last year, which could be attributed to a later rental season due to COVID-19 lockdowns from March – May of this year.

It's important to note that increased supply has impacted unique prospects per property. As more supply floods the market (i.e. Airbnbs), demand is being spread out.

The data also shows there has been a downward trend in demand across primary, and even some secondary markets. We can provide a thesis that this is probably attributed to the movement away from densely populated areas.
 

Top 50 Canadian Cities in Rental Demand: November Report

*Demand is calculated using unique prospects per property per city for Sept 2020 versus Oct 2020

 

Notable Changes in Demand Over the Past Month

Upwards

Western suburbs such as New Westminster, BC (+0.5), Nanaimo, BC (+1.8), Burnaby, BC (+0.2), Coquitlam, BC (+0.8), Victoria, BC (+0.2), experienced an increase in demand this month from the previous month.

Vancouver, BC remained steady in position and demand, but saw a 3% increase in unique prospects per property.

Brantford, ON moved up 10 spots and saw an increase in demand, and a 14% increase in unique prospects per property.

Toronto, ON moved up 4 spots, and saw an increase in demand of 0.1 point, and an increase of 8% unique prospects per property this month.

Lethbridge, AB moved up 5 spots and saw a 5% increase in unique prospects per property.

Downwards

Cambridge, ON dropped 6 spots, a reduced demand by 1.0 points, and 27% decrease in unique prospects per property this month.

Oakville, ON dropped 9 spots, reduced demand by 1.0, and decreased unique prospects per property by 37%.

Etobicoke, ON dropped 13 spots, reduced demand by 1.4 points, and 37% in unique prospects per property this month.

East York, ON dropped 22 spots, reduced demand by 1.7, and a reduction of 55% in unique prospects per property this month.

Top 10 Canadian Cities in Demand Drill Down (M/M): Oct 2020 vs. Sept 2020

**Note: Although demand in certain cities (New Westminster, BC) has increased, supply has also exponentially increased, causing a decrease in unique prospects per property in these cities.

Key Trends for Top 10 Canadian Cities in Demand (M/M)

1. Oshawa, ON moved up 1 spot and experienced an increased demand by 1.1 points from the previous month.
    
2. Surrey, BC dropped 1 spot and reduced demand by 1.2 points, and experienced a decrease in unique prospects per property (down 17%).
    
3. New Westminster, BC moved up 5 spots and experienced an increased demand by .5 points, with a slight  increase in unique prospects per property (6%).
    
4. Brantford, ON moved up 10 spots this month, and saw an increased demand of 0.8 points, with a significant increase in unique prospects per property (24%).
    
5. Abbotsford, BC dropped 1 spot on the list, reduced demand by 0.5, with a decrease of 22% unique prospects per property for the month.
    
6. Brampton, ON moved down 3 spots, experienced a reduced demand of 1.4 points, and a 30% decrease in unique prospects per property for the month.
    
7. Nanaimo, BC sharply moved up 25 spots, with an increased demand of 1.8 points, and increased unique prospects per property by 57%.
    
8. Kitchener, ON moved up 2 spots, and had an increased demand of 0.1, and slight increase in unique prospects (1%) for the month.
    
9. Burnaby, BC moved up 3 spots on the list, and increased demand by 0.2 points, with an increase of 8% unique prospects per property.
    
10. Welland, ON moved up 1, despite a decrease in demand (0.2 points), and decrease in unique prospects per property ( down 6%).

*A greater marketing and advertising push in Nanaimo, BC could be attributed to its spike in demand this month.

Top 10 Canadian Cities Drill Down (Y/Y): Oct 2020 vs. Oct 2019

Key Trends for the Top 10 Canadian Cities in Demand (Y/Y)

1. Oshawa, ON has moved up 5 spots since this time last year, increasing demand by 2.1 points, and a 16% increase in unique prospects per property year-over-year.
    
2. Surrey, BC dropped 1 spot, decreased demand by 2.9 points, and experienced a sharp decline in unique prospects per property (down 49%) this year versus last year.
    
3. New Westminster, BC moved up 6 spots, increased demand by 0.3 points, despite a decline in unique prospects per property (15%).
    
4. Brantford, ON moved up 16 spots this year versus last year, with an increased demand of 1.2 points, and increase in unique prospects per property by 21%.
    
5. Abbotsford, BC moved up 11 spots on the list, and increased demand by 1.0 points, and saw a slight increase in unique prospects per property (8%).
    
6. Brampton, ON dropped 2 spots, and had a reduced demand of 1.6 versus this time last year, and saw a reduction of 46% unique prospects per property.
    
7. Nanaimo, BC moved up 25 spots, with an increased demand of 2.9 points, and increased unique prospects per property by 51%.
    
8. Kitchener, ON dropped 2 spots, and had a reduced demand of 0.8, with a decrease of 37% unique prospects per property.
    
9. Burnaby, BC moved up 1 spot on the list, despite a 0.2 reduction in demand, and a decrease of 25% unique prospects per property.
    
10. Welland, ON dropped 3 positions, reduced demand by 0.8, and saw a decrease of 38% versus the same time last year.

*The increase in demand found in Brantford, Abbotsford, and Nanaimo could be related to remote work and migration to less densely populated areas with reduced rent rates. Also, a greater marketing push in Nanaimo could be attributed to its spike in demand this month.

*We have an additional 68 properties listed (+20%) on ILS's, giving the appearance of a poorer performance in 2020 vs 2019, but we actually see a 16% increase in average unique prospects per property versus the same time last year. 

*These trends are consistent with what we have witnessed since the beginning of COVID-19. As cities with denser populations experience a reduction in demand and increase in supply, (in part due to short-term rentals entering the long-term rental market), some secondary and even tertiary areas that provide more living and working space are experiencing an increase in demand. 

An Analysis of Key Canadian Markets

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:

• Primary (Populations Over 600K)
• Secondary (Populations Between 600-235K)
• Tertiary (Populations Between 235-175K)

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.

Primary Markets (Populations >600K)

Canadian Cities – Primary Market Drill Down: Oct 2020 vs. Sept 2020

Notable Changes in Primary Markets Over the Past Month

Upward

Toronto, ON moved up 2 spots on the list, increasing demand by 0.1 point, and experienced a slight increase in unique prospects per property (8%) compared to last month.

Downward

North York, ON saw a reduction of 0.3 in demand and a decrease of 12% in unique prospects per property this month versus last.

Mississauga, ON had a reduced demand of 0.2 points and a decrease of 12% unique prospects per property this month.

Scarborough, ON reduced demand by 0.2 points and experienced a 10% decrease in unique prospects per property this month.

Montreal, QC experienced a decrease of 0.2 demand points and a 12% decrease in unique prospects per property this month. 

*Overall, month-over-month demand remained relatively stable in primary markets from September to October, and is expected due to seasonal shifts in demand. Unique prospects per property decreased by 6.7% on average for the month. (See the year-over-year analysis below, for more perspective on demand decline in primary markets.)

Canadian Cities – Primary Market Drill Down (Y/Y): October 2020 vs. October 2019

**Note: Although demand in certain cities (Calgary. AB, Winnipeg, MB, Edmonton, AB) has increased, supply has also exponentially increased, causing a decrease in unique prospects per property in these cities.

Notable Changes in Primary Market Demand Over the Past Year

Upward

Calgary, AB has seen a slight increase in demand (0.2) from this time last year and has moved up 3 spots for demand in primary markets, however it has still experienced a 9% decrease in unique prospects per property.

Winnipeg, MB has remained in the same spot, but saw a small increase in demand (0.1) this year versus last year, it has, however, seen a slight dip in unique prospects per property (down 5%). 

Edmonton, AB has remained in the same spot, but has also experienced a small increase in demand (0.1) this year versus last year, but is seeing a 17% decrease in unique prospects per property from this time last year. 

Downward

North York, ON saw a decrease of 0.5 in demand and a 22% decline in unique prospects per property this year versus last year.

Mississauga, ON experienced a 0.6 point decrease in demand, and a 40% decline in unique prospects per property from last year.

Scarborough, ON had a 0.7 point decrease in demand, and a 44% decline in unique prospects per property.

Vancouver, BC decreased demand by 0.4 points and saw a 36% decline in unique prospects per property.

Montreal, QC experienced the greatest year-over-year decrease, having dropped from the number 1 primary market, to number 6, and experienced a decrease of 1.4 demand points, and 63% decline in unique prospects per property.
 
Toronto, ON dropped 2 spots on the primary market list, and had seen a 0.8 decrease in demand, and 52% decline in unique prospects per property.

Ottawa, ON has dropped 3 spots on the primary market list, seeing a 0.1 decrease in demand, and 23% decline in unique prospects per property.

*According to our data, Western cities in primary markets appear to be less impacted by the effects of COVID-19 on year-over-year demand. However, supply is still outpacing demand in most of these cities.

*Ontario and Quebec have been considered hot beds for COVID-19, and the downward trend in demand and unique prospects per property, is likely a reflection of the restrictions and provisions in the primary markets within these provinces.

Secondary Markets (Populations ~600-235K)

Canadian Cities – Secondary Markets Drill Down (M/M): September 2020 vs. October 2020

Notable Changes in Secondary Market Demand Over the Past Month

Upward

Oshawa, ON increased demand by 1.1 points this month and has seen an increase of 17% in unique prospects per property this month versus last.

Victoria, BC saw an increase of 0.2 demand points and an increase of 13% unique prospects per property versus last month.

Downward

Surrey, BC decreased by 1.2 demand points and saw a 17% decrease in unique prospects per property this month versus last month.

Brampton, ON experienced a 1.4 decrease in demand and a 30% decrease in unique prospects per property this month versus last.

Etobicoke, ON saw a 1.4 point decrease in demand and a 37% decrease in unique prospects per property.

Quebec City, QC went down by 0.1 demand point and experienced a 11% decline in unique prospects per property.

Canadian Cities – Secondary Market Drill Down (Y/Y): October 2020 vs. October 2019

**Note: Although demand in certain cities (Halifax, NS, London, ON) has increased, supply has also exponentially increased, causing a decrease in unique prospects per property in these cities.

Notable Changes in Secondary Market Demand Over the Past Year

Upward

Oshawa, ON increased demand by 2.1 points and 16% unique prospects per property this year versus last year.

London, ON saw an increase in 0.5 demand this year, but experienced a 3% decrease in unique prospects per property versus this time last year.

Victoria, BC had a 0.8 increase in demand this year, and a 38% increase in unique prospects per property versus this time last year.

Downward

Surrey, BC decreased in demand by 2.9 points and had a 49% decline in unique prospects per property this year versus this time last year.

Brampton, ON decreased in demand by 1.6 points this year and experienced a 47% decline in unique prospects per property this year versus this time last year.

Hamilton, ON decreased in demand by 0.3 points, and saw a decline in unique prospects per property by 30% this year versus last.

Etobicoke, ON demand decreased by 1.1 points and saw a 46% decline in unique prospects per property.

Quebec City, QC decreased by 0.2 demand points and saw a 44% decline in unique prospects per property.

*Secondary markets that are close to densely populated areas with less space and higher rental rates, such as Surrey, BC, Brampton, ON, Etobicoke, ON, and Quebec City, QC are experiencing the greatest decline in secondary market demand. One thesis could be that remote work is making it possible for renters to look elsewhere for more affordable housing.
 

Tertiary Markets (Populations ~235-175K)

Canadian Cities – Tertiary Markets Drill Down (M/M): Oct 2020 vs. Sept 2020

Notable Changes in Tertiary Market Demand Over the Past Month

Upward

Burnaby, BC experienced a slight increase in demand (+0.2) and in unique prospects per property (8%) this month versus last month.

Downward

Oakville, ON saw a 1.0 decrease in demand and a 28% decline in unique prospects per property this month versus last month.

Nepean, ON decreased demand by 0.8 points and saw a decline of 25% in unique prospects per property this month. 

Saskatoon, SK decreased demand by 0.2 points and 13% unique prospects per property this month versus last month.

*The majority of tertiary market cities did not see a significant decrease in month-over-month demand, and are reflective of seasonal market trends.

Canadian Cities – Tertiary Markets Drill Down (Y/Y): October 2020 vs. October 2019

 

**Note: Although demand in certain cities (New Westminster, BC) has increased, supply has also exponentially increased, causing a decrease in unique prospects per property in these cities.

Notable Changes in Tertiary Demand Over the Past Year

Upward

Sudbury, ON experienced a 0.9 point increase in demand and 9% increase in unique prospects per property this year versus last year.

Richmond, BC saw a 0.9 point increase in demand this year, and a 62% increase in prospects per property versus last year.

Saskatoon, SK increased its demand by 0.3 this year and unique prospects per property by 22%.

Downward

Kitchener, ON decreased demand by 0.8 points and unique prospects per property by 37% this year versus last year.

Oakville, ON saw a decrease in demand by 0.1 and a 25% decline in unique prospects per property this year.

Burlington, ON remained relatively steady in demand, however its unique prospects per property decreased by 21% this year versus this time last year.

*Western and northern – more remote cities – appear to be experiencing an increase in demand versus those who are closer to cities with dense populations.

Conclusion

The data shown in this report show that despite COVID-19, the rental market appears to be stable, and experiencing normal seasonal shifts in demand. However, it is important to highlight that there are notable changes in demand across primary and even in some secondary markets. In many regions we are seeing an increase in supply and a  reduction in demand prospects  are seeing  where we see the greatest shift in lead volume. 

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.