The result has been higher rents in Saskatchewan's capital, up to an average of $881 per month for a two-bedroom suite, compared with $832 a year earlier.
Across the province, the average two-bedroom rent is now around $872 per month, CMHC reports.
The low vacancy rate has convinced the City of Regina to not approve any further conversions of rental apartments to condominiums, at least in the near future.
Appraisers say there is much more demand than supply for Regina apartment buildings. A report from B.R. Gaffney and Associates Ltd. says the price per suite for better rental buildings ranges from $75,000 to $90,000 with a capitalization rate of around 5 per cent. Less-than-prime buildings in less-popular locations are selling from $42,000 to $61,000 per suite, the study found.
Estevan has seen its rental vacancy rate plunge from 4.5 per cent to 1.5 per cent as a recovery in oil prices drew more workers to southern Saskatchewan, CMHC reports. Moose Jaw is notable for having the highest average rental increase in the province, posting a 14 per cent increase from a year ago.
Moose Jaw, with a 1.4 per cent vacancy rate and Saskatoon, at 2.6 per cent, are also close to the lowest vacancy rates in Canada. The Saskatoon rate is up marginally from a year earlier.
Avison Young, Regina, notes that low mortgage interest rates, available to buyers through CMHC mortgage insurance coverage, and a high level of net migration to the province make the Saskatchewan multi-family market a prime investment going into 2011.
from Western Investor, February 2011
