Rental Market Tightening in Ottawa

The rental market in Canada is getting tighter – especially in Ottawa. But if you know where to go and what to look for, you can still get an excellent apartment in the nation’s capital. Here’s the rundown on the latest rental market conditions, based on a study conducted by the Canada Mortgage and Housing Corporation.

Overall, rental demand increased in Ottawa as a result of higher homeownership costs, weak rental construction markets and increased immigration and youth employment. These changes caused the vacancy rate (the percentage of apartments that are unoccupied and immediately available to rent) to drop to 2.3 percent from 3.3 percent in 2005. Meanwhile, across the river in Gatineau, the vacancy rate climbed to 4.2 percent, up from 3.1 percent one year earlier. This increase can be credited to the fact that homeownership is still more affordable in Quebec.

Vacancies by Neighbourhood

If you’re looking to rent an apartment in some of the “trendier” areas of the city, you might want to consider acting early and putting yourself on a waiting list. An empty apartment is rather rare in the Westboro / Britannia area, where the vacancy rate is a mere 1.3 percent. The Glebe and Old Ottawa South also had very low vacancy rates, sitting at 1.4 percent for 2006. In comparison, the Gloucester / Cumberland area had the highest vacancy rate in Ottawa at 4.6 percent – just one of two areas in the city to see an increase in vacancies compared to the previous year.

One-bedroom suites are the toughest type of apartment to find, with availability rates (the percentage of units that are vacant plus the ones that will be considered available as the existing tenant has not signed a new lease) the lowest in the city at 4.1 percent. Larger families will have an easier time finding a place to live, as the availability rate for a three-bedroom unit was 6.2 percent.

Availability Goes Down, Rent Goes Up

As a result of the tighter rental market, rent in Ottawa has increased. The average two-bedroom apartment rent went up by 3 percent in 2006. The highest rental rates can be found in newer buildings (because of their superior condition and amenity mix) and in larger buildings with 200 units or more.

Broken down by location, the highest rent in Ottawa, on average, is in the Sandy Hill / Lowertown area ($930). In comparison, the lowest rent could be found in Vanier, where tenants paid an average of $713 each month. Overall, the average rent in Ottawa was $844.

Rental Market Outlook for Ottawa in 2007

Vacancy rates are expected to move even lower in 2007 to an estimated 2.1 percent, making it even more difficult to find an apartment in the city. Rent will also rise by a similar amount to 2006 – experts predict that the average rent for a two-bedroom unit in Ottawa to be approximately $960 in 2007.

Canada-Wide Statistics

The average apartment vacancy rate in Canada decreased slightly in 2006 to 2.6 percent, down 0.1 percent from the year before. The highest vacancy rates were found in Windsor (10.4 percent), Saint John (6.8 percent) and St. John’s (5.1 percent). Meanwhile, the lowest vacancy rates were primarily found out west, with Calgary (0.5 percent), Victoria (0.5 percent) and Vancouver (0.7 percent) being the cities with the least amount of available apartments.

Compared to the other major cities in the country, Ottawa, at 2.3 percent vacancy, ranks slightly behind Toronto (3.2 percent) and Montreal (2.7 percent). Ottawa does fare better than Calgary, Vancouver and Edmonton, which scored a 1.2 percent vacancy rate.

Canada’s highest average monthly rents for a two-bedroom apartment were Toronto ($1,067) and Vancouver ($1,045), followed by Calgary ($960) and Ottawa ($940). The lowest rents in the country were found in Quebec in Trois-Rivieres ($488) and Saguenay ($485).

The Ottawa Advantage

So, what do all these numbers mean for people searching for an apartment for rent in Ottawa? Well, they say that Ottawa is about middle of the road in terms if vacancies, availabilities and rent prices – that is, it isn’t as hard to find an apartment in Ottawa as it is in the western provinces, but there are less available units in the city than there are elsewhere in Ontario. However, even though there are fewer vacancies, the rent is actually cheaper than it is in Toronto. Combined with all of the great amenities and attractions already found in the National Capital Region, Ottawa is still a very attractive destination for renters in Ontario.