Justin da Rosa
Canadian Real Estate Wealth
We talk the markets that showed the most surprising demand in 2016, as well as a forecast for the near future
CREW: Which markets were the most surprising in terms of demand?
AM: The strong increase in traffic on rental ads in the Territories was surprising, but it is our smallest market and therefore shifts in the comparatively smaller totals can translate into big swings on a percentage basis.
One other surprise was the disconnect between major cities in western Canada versus the regional trend. Usually the major centres tend to drive (and are consistent with) the results for their regions overall. But while B.C. and the prairies as regions showed slight increases over 2015 (3 per cent and 5 percent respectively), yet we declines in Calgary (down 8 per cent), Vancouver (a 5 percent decline) and Edmonton (down 2 per cent).
CREW: What are your predictions for the rental market in 2017?
AM: The decline in supply of rental apartments in Ontario and Quebec shows no sign of changing in 2017, so we expect those markets to remain highly competitive. In the prairies, as the market adjusts to new oil prices, we expect rental supply to flatten out over the course of the year. And B.C.’s supply should continue to contract as additional costs of ownership are felt.
Time to rent should continue to be consistent in Ontario, Quebec and the prairies. The volatility we saw in B.C. last year will likely settle down in mid-2017 as landlords adjust to the “new normal” of ownership rules and can evaluate their new tax costs in Q1.
On price, our expectation is consistency with 2016 in most of Canada. Prices should begin flattening in B.C. as the market settles there, but it may take until mid-year.
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