Rentsync National Rental Demand Report: December 2021

Executive Summary

In this comprehensive national rental demand report, we outline significant changes in unique leads per property 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 unique 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

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 leads per property, per city, and compared against benchmark data. 

For example: Waterloo, ON received a demand score of 6.5 this month, versus 6.6 last month. Therefore, Waterloo experienced a decrease in its demand score by 0.1 this month.

Demand Percentage (% +/-): This is determined according to the year-over-year (YOY) or month-over-month (MOM) increase or decrease in unique leads per property.

For example: The month-over-month unique leads per property in Waterloo, ON went down 2% in November versus October. However, in November 2021, the year-over-year Demand Score in Waterloo, ON went up 4.5 points based on an increase of 223% unique leads per property compared to November 2020.

Position: The position is determined by unique leads per property, with cities that have at least *20 properties or more. The position will vary depending on demand.

For example: This month, Waterloo, ON moved down 1 spot on the Top 50 Canadian Cities in Demand. Year-over-year Waterloo, ON is up 9 spots since last year.

*The following report provides month-over-month ILS data for November 2021 versus October 2021, as well as a year-over-year comparison from November 2021 versus November 2020. It also outlines the month-over-month and year-over-year trends in primary, secondary, and tertiary markets.

Key Takeaways:

Month-over-month (M/M): Overall, unique leads per property from October to November decreased -7.83%. The month-over-month market snapshots are as follows:

• Primary: Unique leads per property decreased -2.61%
• Secondary: Unique leads per property decreased -8.5%
• Tertiary: Unique leads per property increased -5.5%

*The decrease in unique leads per property is consistent with seasonal shifts in renter behavior and the associated decrease in online traffic. This decrease while expected is in fact substantially lower than in November 2020 which experienced a decrease of -12.42% month over month. This suggests that we are likely to see a similar albeit smaller variance in October to November 2021 data versus October to November 2020.

Year-over-year (Y/Y): Overall, in Canada, unique leads per property​ for multifamily residential housing is up +40.45% this year versus the same time last year, indicating that rental demand remains on an upwards trajectory. Overall, the year-over-year (November '21 vs November '20) data shows:

• Primary: Unique leads per property are up +53.1% 
• Secondary: Unique leads per property are up +84.3%
• Tertiary: Unique leads per property are up +113.5%

*The year over year analysis indicates that rental demand has increased across all markets, with the greatest growth experienced in tertiary markets.

Top 50 Canadian Cities in Demand

*Demand is determined by calculating unique lead volume per property by market.

Notable Changes in Demand Over the Past Month

Overall, Canadian cities experienced a decrease in unique leads per property month-over-month (November 2021 vs October 2021), which is reflective of seasonality, with only a few cities experiencing significant changes in demand versus last month. Although lead volume has decreased month over month, the relative decrease is substantially lower than would be expected when compared to previous years while also up from Q3 2021. This suggests that the destabilizing effects experienced during covid in regards to lead volume and renter traffic have all but disappeared. 

Upward

• Surrey, BC saw a 13% increase in unique leads per property this month versus last month.
• Kitchener, ON moved up 7 spots, and experienced a 17% increase in unique leads per property.
• North Vancouver, BC saw a 3% increase in unique leads per property this month versus last month.
• Richmond, BC saw a 17% increase in unique leads per property this month versus last.
• Cambridge, ON experienced a slight increase of 6% unique leads per property this month versus last.
• Vancouver, BC also saw a small 3% jump in unique leads per property this month. 
• North York, ON moved up 7 spots this month, with an 8% increase in unique leads per property.
• Montreal, QC saw a 6% increase in unique leads this month versus last month.

Downward

• Oshawa, ON moved down 4 spots and saw a decline of 23% in unique leads per property.
• Burnaby, BC dropped 4 spots, and saw a decline of 14% in unique leads per property this month versus last month.
• Halifax, NS dropped 2 spots this month with an 11% decrease in unique leads per property.
• Victoria, BC moved down 7 spots, saw a 17% decrease in unique leads per property.
• East York, ON moved down 6 spots, and saw a 13% decrease in unique leads per property.
• Branford, ON dropped 6 spots, and saw a 17% decrease in unique leads per property this month.
• Guelph, ON moved down 9 spots, and experienced a 21% decrease in unique leads per property.
• Sudbury, ON moved down 3 spots, and experienced a 14% decrease in unique leads per property.
• Abbotsford, BC moved down 2 spots, saw a 14% decrease in unique leads per property.
• Welland, ON moved down 8 spots, and saw a 19% decrease in unique leads per property this month.
• Niagara Falls, ON moved down 6 spots, and reported a 18% decrease in unique leads per property.
• Lethbridge, AB moved down 5 spots, and reported a 12% decrease in unique leads per property.

Top 10 Canadian Cities in Demand Drill Down (M/M): November 2021 vs. October 2021

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

1. Gatineau, ON re-entered the list with a demand score of 7.2 due to an increase in listed properties that meet our reporting criteria.
2. Waterloo, ON moved down 1 spot, and saw a 2% decrease in unique leads per property.
3. Surrey, BC moved up 1 spot, and saw a 13% increase in unique leads per property this month versus last month.
4. Kitchener, ON moved up 7 spots, and saw a 17% increase in unique leads per property this month versus last month.
5. New Westminster, BC moved down 1 spot with a -3.4 point change and a 32% decrease in unique leads per property.
6. Oshawa, ON moved down 4 spots with a 23% decrease in unique leads per property.
7. Burnaby, BC moved down 4 spots on the list this month, with a 14% decrease in unique leads per property.
8. Halifax, NS moved down 2 spots, and reported a decrease of 11% unique leads per property.
9. Coquitlam, BC entered the top 10 list after reaching over 20 properties on the market and saw a demand score of 4.7 points.
10. North Vancouver, BC moved down 1 spot, but experienced a 3% increase in unique leads per property.

*We should note overall that although the relative demand scores decreased substantially month-over-month this is moreso a result of a greater number of active properties listing their available units, and not as an outcome of lead demand experiencing a substantial dropoff as would be expected moving into the holiday season.

Top 10 Canadian Cities Drill Down (Y/Y): November 2021 vs. November 2020

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

1. Gatineau, ON re-entered the list, and due to a lack of comparable data, we are unable to comment on it’s change.
2. Waterloo, ON moved up 9 spots, and saw a 223% increase in unique leads per property.
3. Surrey, BC moved down 1 spot, and saw a 7% increase in unique leads per property this year versus last year.
4. Kitchener, ON moved up 2 spots, and saw a 92% increase in unique leads per property this year versus last year.
5. New Westminster, BC moved up 5 spots with 102% increase in unique leads per property.
6. Oshawa, ON moved down 3 spots and saw a small 4% increase in unique leads per property.
7. Burnaby, BC moved up 2 spots on the list this year, with a 101% increase in unique leads per property.
8. Halifax, NS moved up 11 spots, and reported an increase of 125% unique leads per property.
9. Coquitlam, BC moved up 18 spots this year, and experienced a 150% increase in unique leads per property.
10. North Vancouver, BC moved down 2 spots, and experienced a 105% increase in unique leads per property.

*Since November 2020, new cities that have entered the top 10 list include Halifax, NS, ON, and Coquitlam, BC. Other notable cities include Waterloo, ON, New Westminster, BC, Burnaby, BC, and North Vancouver, BC. With the renormalization of renter traffic and apartment inquiries we would expect that the markets attracting the greatest volume of inquiries would shift once more to major markets, as was experienced prior to Covid, however, this has not been fully realized yet.

Although renters are becoming increasingly more comfortable with the new normal and have gone out to the market in sufficiently large volumes in order to start reabsorbing much of the vacant apartment stock left unoccupied by the Covid shift towards secondary markets. The actual focus of many seems to remain in secondary suburban communities. Many households have begun to rent in major cities whether in a bid to capitalize on the marginally improved affordability offered by depressed rents, or simply to move forward with their lives, however the demand experienced by smaller outlying communities has not slowed.

This suggests to us that the long term trend of individuals moving further from major markets is likely to continue and that we are likely to see suburban communities remain in high demand, in regards to lead traffic and inquiries.

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: 

1. Primary (Populations Over 600K)
2. Secondary (Populations Between 600-235K)
3. Tertiary (Populations Between 235-100K).

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.

Key takeaways

Month-Over-Month (M/M)

• Primary: Unique leads per property are down -2.61%
• Secondary: Unique leads per property are down -8.5%
• Tertiary: Unique leads per property are down -5.5%

Year-Over-Year (Y/Y)

• Primary: Unique leads per property are up +53.1% 
• Secondary: Unique leads per property are up +84.3%
• Tertiary: Unique leads per property are up +113.5%

Primary Markets (Populations >600K)

Primary Market Drill Down (M/M): November 2021 vs. October 2021

Notable Changes in Primary Markets Over the Past Month

*Unique leads per property in primary markets saw a slight decrease this month versus last month, which is consistent with seasonal trends. Overall unique leads per property decreased by -2.61% in primary markets this month. Primary markets experienced a lower relative decrease in leads per property which is substantially lower than that experienced by both secondary and tertiary markets. When compared to the overall growth of leads within secondary markets this suggests that while an increasing number of renters are willing to move further away from major markets in search of more affordable housing and various opportunities, the demand for major markets has not slowed down. We are likely to continue seeing a growth in lead volume within major markets in the coming year once the seasonal slowdown passes by.

Upward

• Vancouver, BC increased by 3% unique leads per property since last month.
• North York, ON also increased by 8% unique leads per property this month versus last month.
• Edmonton, AB remained at 0.9 in demand points but did see a 6% increase in unique leads per property.

Downward

• Mississauga, ON saw a -11% decrease in month-over-month unique leads per property.
• Calgary, AB saw a 8% decrease in unique leads per property from last month.
• Scarborough, ON also experienced no point reduction, as it saw a small -1% decrease in unique leads per property since last month.
• Ottawa, ON experienced a 5% decrease in unique leads per property from  the previous month.
• Toronto, ON saw a 8% decline in unique leads per property this month versus last.
• Winnipeg, MB reported a 5% decrease in unique leads per property this month versus last month.
• Montreal, QC experienced a 13% decline in unique leads per property since last month.

(See the year-over-year analysis below, for more perspective on demand in primary markets.)

Primary Market Drill Down (Y/Y): November 2021 vs. November 2020

Notable Changes in Primary Market Demand Over the Past Year

*Total unique leads per property increased +34.6% year-over-year in primary markets. Overall, year-over-year primary market unique leads per property continues to rebound versus the same time last year. A number of factors have catalyzed a return to downtown cores including the return to on-site work, double doses have become more widely adopted especially in urban areas, and a return to school, travel, and immigration has influenced continued demand. 

As a result of this renewed interest in urban living, vacancies in core markets have shrunk year over year with the GTA achieving a 3% vacancy in Q3 2021 down from 3.2% in Q3 2020. Alongside the growing demand for apartments, we also experience growth in rental rates which suggest that not only has demand rebounded, but that market fundamentals are returning, which have allowed for the continued growth and acceleration of rental rates within metropolitan areas after over a year of stagnation.

Upward

• Vancouver, BC moved up 3 spots, experiencing a 135% increase in unique leads per property year-over-year.
• North York, ON reported a 73% increase in unique leads per property year-over-year.
• Mississauga, ON reported a 59% increase in unique leads per property this year versus last.
• Calgary, AB moved up 1 spot from this time last year and saw a 107% increase in unique leads per property. 
• Scarborough, ON moved down 3 spots, but saw a 44% increase of unique leads per property.
• Ottawa, ON moved up 3 spots, and saw a 47% lift in unique leads per property this year versus last.
• Toronto, ON moved down 1 spot but saw a 69% increase in unique leads per property this October versus last October.
• Montreal, QC moved down 3 spots this year but experienced a lift of 24% in unique leads per property.

Downward

• Winnipeg, MB saw a 11% decline in unique leads per property this year versus last year. 
• Edmonton, AB moved up 1 spot but saw a 16% decline in unique leads per property from 2020.

Secondary Markets (Populations ~600-235K)

Secondary Markets Drill Down (M/M): November 2021 vs. October 2021

Notable Changes in Secondary Market Demand Over the Past Month

*Secondary markets saw a decrease of -8.5% unique leads per property this month. Overall, secondary markets saw a slight decrease in unique leads per property this month, which is likely due to seasonality, and a waning in demand from a extremely hot market since the first few months of the pandemic. Additionally, secondary markets saw a slower month versus primary markets, which may be a sign that market demand is beginning to ease. But is unlikely to stall completely as Secondary markets continue to bear the burden of providing more affordable renters while also being accessible to commuters. 

Upward

• Gatineau, QC experienced a reduction in overall lead volume, and an increase in active buildings which has resulted in an overall reduction in its demand score, but enters the list at the top spot this month.
• Surrey, BC saw an increase of 13% in unique leads per property this month versus last month.
• Kitchener, ON moved up 2 spots and saw an increase of 17% in unique leads per property this month.
• Etobicoke, ON moved down 1 spot, and remained at 3.6 in demand points but saw a 1% increase in unique leads per property this month versus last.
• Hamilton, ON experienced a 3% increase in unique leads per property this month versus last.

Downward

• Oshawa, ON moved down 3 spots and saw a decrease of 23% in unique leads per property.
• Halifax, NS moved down 1 spot, and experienced a 11% decrease in unique leads per property this month versus last month.
• Victoria, BC moved down 3 spots, and saw a 17% decrease in unique leads per property.
• Brampton, ON moved down 1 spot, and saw a 2% decrease in unique leads per property from last month.
• London, ON moved down 2 spots, reported a 7% decline in unique leads per property this month versus last month.

Secondary Market Drill Down (Y/Y): November 2021 vs. November 2020

Notable Changes in Secondary Market Demand Over the Past Year

*Overall, unique leads per property are up +84.3%% in secondary markets this year versus this time last year. Although secondary markets experienced the largest average month-over-month decline in unique leads per property the significant year-over-year increase suggests that these communities are likely to continue experiencing growth in rental demand along with the continued upward trajectory of rental rates as many individuals continue to work remotely, or have simply begun to value the characteristics of secondary markets over those more urban communities.

Upward

• Gatineau, QC entered the list this year, but due to lack of inventory this time last year, we cannot make an accurate year-over-year comparison.
• Surrey, BC moved down 1 spot, but saw an increase of 7% in unique leads per property this year versus last month.
• Kitchener, ON saw an increase of 92% in unique leads per property this year versus last
• Oshawa, ON moved down 2 spots but saw an increase of 4% in unique leads per property this year versus last.
• Halifax, NS experienced a 125% increase in unique leads per property this year versus last year.
• Victoria, BC moved up 4 spots, and saw a 235% increase in unique leads per property.
• Brampton, ON reported a 145% increase in unique leads per property from this time last year.
• Etobicoke, ON moved down 2 spots, but saw a 104% increase in unique leads per property this year versus last.
• Hamilton, ON moved down 5 spots, but experienced a 135% increase in unique leads per property this year versus last.
• London, ON moved down 2 spots, and reported a 46% increase in unique leads per property this year versus last year.

Tertiary Markets (Populations ~235-100K)

Tertiary Markets Drill Down (M/M): November 2021 vs. October 2021

Notable Changes in Tertiary Market Demand Over the Past Month

*Unique leads per property decreased by -5.5% this month versus last month in tertiary markets. Tertiary markets are experiencing the greatest variability in regards to lead volume, and property availability, however, there is an overall trend of declining renter traffic attributed to seasonality. While some markets experience a positive growth in traffic the vast majority have not been immune to the winter slowdown as many look to remain indoors and forgo thoughts of relocation. Although these communities typically have a smaller stock of available apartments the strong growth in rental demand likely suggests that they will continue growing and will be an area of interest for future renters.

(See the year-over-year analysis below, for more perspective on the rise in demand in tertiary markets.)

Upward

• Richmond, BC moved up 1 spot, and saw unique leads per property increase by 17% this month versus last month
• Cambridge, ON moved down 1 spot, but saw a 6% lift in unique leads per property this month versus last year.
• St. Catharines, ON moved up 3 spots, and experienced a 3% increase in unique leads per property this month versus last month.

Downward

• Burnaby, BC saw a 14% decrease in unique leads per property this month versus last month.
• East York, ON dropped 3 spots, and experienced a 13% decrease in unique leads per property.
• Kingston, ON reported a 5% reduction in unique leads per property this month versus last.
• Guelph, ON moved down 3 spots, and saw a 21% decrease in unique leads per property.
• Sudbury, ON moved down 3 spots, and saw a 14% decrease in unique leads per property.

New to top 10 tertiary markets

• Coquitlam, BC entered the list in the #2 with a demand score of 4.7
• Barrie, ON entered the list at #10 with a demand score of 2.6

Tertiary Markets Drill Down (Y/Y): November 2021 vs. November 2020

Notable Changes in Tertiary Demand Over the Past Year

*Overall, unique leads per property are up in tertiary markets +113.5% this year versus the same time last year. As previously mentioned, although many have begun to return to major markets in order to be closer to their places of work as employers mandate on-site presence, there remains a substantial population of those who continue to work remotely and are able to take advantage of the lower cost of living offered by many tertiary markets.

Upward

• Burnaby, BC remained at the top of the list and saw a 101% increase in unique leads per property.
• Coquitlam, BC moved up 2 spots and saw a 150% increase in unique leads per property this year versus last year.
• Richmond, BC moved up 4 spots, and saw a 164% increase in unique leads per property this year versus last year.
• Cambridge, ON moved up 1 spot and saw a 121% increase in unique leads per property this year versus last.
• East York, ON moved up 5 spots, and experienced a 258% increase in unique leads per property this year versus last year.
• St. Catharines, ON dropped 3 spots, but still saw a 57% increase in unique leads per property this year.
• Kingston, ON dropped 3 spots, but reported a +1.6 point increase due to a 103% boost in unique leads per property.
• Guelph, ON moved up 2 spots, and saw a 93% increase in unique leads per property.
• Sudbury, ON moved down 7 spots, but still saw a 12% increase in unique leads per property from last year.
• Barrie, ON moved down 4 spots, but experienced a 57% increase in unique leads per property from last year.

Conclusion

The data shown in this report shows that this month the Canadian rental market has remained consistent from October to November, with minor seasonal declines in unique prospects per property. The seasonal decline remains consistent with month-over-month data from Nov. vs Oct 2020 However, it is possible that supply for purpose-built rentals is further impacting lead volume. Vacancy rates in urban areas such as Toronto have dropped from 6.4% in Q1 of 2021 to 3% in Q3, and with less availability for specific unit types, lead volume is slowing, as renters are not inquiring on units that do not meet their needs.

Vacancies have declined by .2% year over year which can be in part attributed to the reopening of borders and immigration. Therefore, with the continued and growing demand experienced by secondary and tertiary markets the development of larger purpose-built rental communities which is common in larger urban centers may become more common place in these smaller communities. This will further motivate new immigrants entering Canada that are priced out of major markets to begin settling in smaller communities thus further incentivizing developers to build more and larger apartment communities across the country. Many developers will also appreciate the fewer barriers to entry, and lower rates of competition amongst existing apartment product within these smaller markets which will further promote the development of new rental housing stock.

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