2008 Rental Market Review

Vancouver’s real estate market got a little tougher for renters in 2008 as prices continued to rise and the vacancy rate dropped even further.

According to the latest Canada Mortgage and Housing Corporation Rental Market Report for Vancouver, the region’s vacancy rate fell from 0.7 to 0.5 per cent this year, while the cost of an average apartment jumped from $898 to $937.

“It’s obvious by the statistics that renters are continuing to get squeezed,” says Renters at Risk co-founder Sharon Isaak. “Rents are going up and availability is still a problem. The pressure is not easing for renters at all.”

The report says the strong pressure for rental housing was caused by an influx in migration to the region, a low unemployment rate and the high cost of home ownership. Along with Victoria (also at 0.5 per cent) Vancouver has one of the lowest vacancy rates in the country, with Kelowna leading the way at 0.3 per cent.

While the province’s Residential Tenancy Act kept landlords from raising rents more than 3.7 per cent to existing renters, rents still managed to rise four per cent in 2008. The report says rents increased higher than the legislated rate because of “major renovations performed on rental properties, and the increasing of monthly rents through unit turnover.”

Tenant advocacy groups have been calling on the provincial government for the past few years to close a loophole in the RTA that allows landlords to evict tenants for renovations and then raise rents to whatever they wish. Vision Vancouver Councillor Tim Stevenson is scheduled to put forward a motion at next Tuesday’s council meeting that would call on the province to change the RTA so tenants can reoccupy renovated suites at the same rent.

However, landlord groups have argued that closing the loophole will mean building owners stop making renovations, which will cause their buildings to become “slums."

Although the CMHC report predicts slower economic growth is expected to “ease” the pressure on the rental market next year, it still forecasts that Vancouver’s vacancy rate will remain below one per cent and that rental rates will rise another three to five per cent.