Rent in Canada just hit an astonishingly new high

Renters in Canada have been suffering for years under the burden of the country’s high cost of housing but the amount now needed to secure a place to live just reached a new record-breaking high. 

High rental prices aren’t anything new to Canadians. Things have been bad long before the global pandemic kicked the cost of housing into high gear. But few have even seen prices as high as they are right now. 

Recently released data from Rentals.ca and the research organization Urbanisation has shown the average asking price for rent in Canada in the month of July reached $2078.

That might sound like an eye-watering amount but that’s just an average. If you need to rent a two-bedroom apartment you’re looking at an average price of $2296. It’s quite a lot of money but at least you can split it with a roommate. 

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If you’re single and unpartnered you can expect to see an average rental asking price for a one-bedroom apartment at $1860, an amount that would leave little left for saving for the average Canadian worker.

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Statistics Canada found the average Canadian earned a salary of $68,400 after taxes in 2021. So that means that about one-third of the average worker's paycheck after taxes is now needed to pay rent in Canada.

The jump to an average price of $2078 for rent represents an 8.9% annual increase and a 1.8% increase month-over-month. The last two years have seen rents in Canada rise by $354 per month or 21%. 

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The reason behind the increase according to Rentals.ca was the rush of students back into the country’s cities coupled with record population growth as well as the dramatic rise in interest rates, a move that sidelined homeowners. 

More worrying than the current cost of rent in Canada is the concern about future costs. Some advocates are saying things could get a lot more expensive for Canadians before the end of the year. 

"I wouldn't be at all surprised if the average asking rents next year in Ontario jumped to $3,500," the director of advocacy and legal services at the Advocacy Centre for Tenants Ontario Douglas Kwon told CTV News.

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"There really doesn't seem to be any sign that this crisis is going to be abated or lessened," Kwon added. 

The President of Urbanation explained that Canada was facing the “perfect storm” of issues that were pushing the country’s rental costs to record highs, specifically citing rising incomes, the country’s open border policy, and the worst housing market ever. 

CTV News noted the average cost to purchase a home in Canada reached $709,218 in June according to data from the Canadian Real Estate Association, which was up about 6.7% from earlier in 2023. 

“Such prices are keeping aspiring buyers in the rental market, but they're not seeing much relief there either,” wrote CTV News’ Hayatullah Amanat. But this issue pales in comparison to the rising rates of immigration into Canada. 

At present, the federal government has a goal of bringing in $465,000 immigrants into the country in 2023 and another $485,000 in 2024, culminating with 500,000 by 2025 for a total of roughly 1.45 million. 

While these new Canadians will certainly help bolster the country’s economy, they will also prove to be a major obstacle for those searching for homes to buy and rent since the laws of supply and demand still reign supreme. 

What Canada’s policymakers need to do is invest more into solving the housing crisis in order to help alleviate the major pressures on the country’s rental market, and throw in a healthy dose of rental support—it never hurts to support the country’s people properly.