Canadian Rents Fall Nationally, But Affordability Crisis Persists in Secondary Markets
A new report by SingleKey reveals that while national average rents dropped 2.1% to $2,051 per month, renters in cities like Winnipeg and Barrie face worsening affordability due to significant income declines.
National average rents in Canada have decreased by 2.1% year-over-year, settling at an average of $2,051 per month. However, this decline has not translated into improved financial stability for many tenants, as stagnant or falling incomes continue to drive housing costs above recommended thresholds.
The findings come from a report produced by SingleKey, a Canadian rental risk intelligence platform. The analysis was based on thousands of rental applications processed across the country between April 1 and June 30. While major metropolitan areas saw some relief, secondary markets experienced distinct challenges.
In Vancouver, rent prices eased by 6% compared to the prior year, while Toronto saw a 5% decrease. These drops contributed to better affordability metrics in these hubs, largely because reported household incomes remain high. For instance, the average household income in Vancouver is $154,162, and in Toronto, it is $149,607. By contrast, the national average household income stands at $113,970, with personal income averaging $72,950.
Despite lower nominal rents, affordability remains a critical issue in several other regions. In Winnipeg, rent prices fell by 8.9% to an average of $1,572, and in Montreal, they dropped by 8.8% to $1,545. Yet, renters in Winnipeg spend approximately 30% of their income on housing, exceeding the national average of 28.1%. This disparity is driven by local economic conditions; income declines in certain secondary markets ranged from six to 21.5 per cent.
Cities such as Barrie, Medicine Hat, Greater Sudbury, Winnipeg, and Kelowna are notable for having renters contribute more of their income to rent than the national average. The Government of Canada recommends that housing costs should not surpass 35% of income, but the combination of lower wages and persistent housing costs means many residents in these areas struggle to meet this guideline. The report suggests that while landlords in some areas may be hesitant to rent due to rising costs and financial risk signals, the primary burden continues to fall on tenants facing income stagnation.