Saskatoon’s multi-family rental sector has seen its vacancy rate fall from a 10.3 per cent peak four years ago to 5.7 per cent, according to the most recent report from Canada Mortgage and Housing Corp. (CMHC). This is the lowest vacancy rate of any urban centre in Saskatchewan.
This was despite the addition of 477 new units to the Saskatoon market.
The study said three major factors contributed to the turnaround, including the addition of 5,600 primarily full-time jobs to the Saskatoon economy between January and September 2019, the introduction of stricter mortgage qualification rules by the federal government that delayed home buying, and growing international migration.
“Strengthening demand relative to supply put downward pressure on rental vacancies in 2019,” said Goodson Mwale, CMHC’s senior analyst of economics.
Owners reaped the benefits as the average rent increased by 2 per cent in 2019 to $1,046 per month, ranging from $722 per month for bachelor pads to $1,280 for three-bedroom apartments.
Barry Stuart, managing partner and senior sales associate of ICR Commercial Real Estate in Saskatoon, said he feels “pretty safe” in predicting that CMHC will find the multi-family vacancy rate will have fallen in its next market update in late 2020.
“This trend of continued absorption, depending upon the amount of new construction, is likely to place continued pressure on rental rates,” he said.
Editor's note: A previous version of this article read that Saskatoon's vacancy rate had fallen to 2.6 per cent. In fact, it has fallen by 2.6 per cent over the past year to 5.7 per cent. We apologize for the editing error.