London Community News
By Paul Everest/London Community News/Twitter: @PaulEverest1
Following national and provincial trends, the number of apartments available for rent in the Forest City dropped between April of this year and the spring of 2011.
According to the Canada Mortgage and Housing Corporation’s (CMHC) Rental Market Survey released Tuesday (June 12), London’s apartment vacancy rate dropped to 3.7 per cent in April from 4.7 per cent during the same month last year.
London’s April, 2012, rate was higher than some of its regional neighbours such as Kitchener-Cambridge-Waterloo, with a rate of two per cent, or Hamilton, with a rate of 2.9 per cent.
It was, however, lower than Windsor, which boasted the second highest vacancy rate in the country at 7.7 per cent.
Overall, the highest vacancy rates in the province were found in Southwestern Ontario’s major centres.
Canada and Ontario each had a vacancy rate of 2.3 per cent in April, 2012, down from 2.5 per cent in the same month last year.
At the same time, the average monthly rent for a new or existing two-bedroom apartment in London increased from $873 in April, 2011, to $896 in April of this year.
The increase in this year’s average monthly rent is 1.4 per cent, compared to 1.3 per cent for the period from April, 2010, to April, 2011.
London’s availability rate for apartments also dropped in the same time period from 8.3 to seven per cent, although that rate is still ranked as the fifth highest out of Canada’s 35 major cities and the third highest in the province.
According to the survey, “a rental unit is considered available if the unit is vacant (physically unoccupied and ready for immediate rental), or if the existing tenant has given or received notice to move and a new tenant has not signed a lease.”
The national rental apartment availability rate was 4.4 per cent in April of this year, up slightly from 4.3 per cent from April, 2011.
Ontario posted identical availability numbers for that time period.
The survey breaks down the number of various types of apartments in London, as well as their vacancy rates and average rents.
-There were 1,197 bachelor apartments in April, 2012, compared to 1,196 last year, with a 2012 vacancy rate of 4.8 per cent compared to 4.2 per cent last year.
The average monthly rent was $570 in 2012 compared to $543 last year.
-There were 17,053 one-bedroom apartments in April, 2012, compared to 16,758 in April of last year, with a vacancy rate of 3.4 per cent this year compared to 4.5 per cent last year.
The average monthly rent was $721 this year compared to $713 last year.
-There were 23,513 two-bedroom apartments in April, 2012, compared to 23,173 last year, with a vacancy rate ratio of 3.8 to 4.8 per cent.
The average monthly rent was $896 this April compared to $873 n April, 2011.
The Canadian average for rent paid on new and existing two-bedroom units was $887 in April, 2012, and overall, the average rent for two-bedroom apartments in existing structures across Canada’s 35 major centres increased 2.2 per cent between April, 2011, and April, 2012, the same level that was observed between April, 2010, and April, 2011.
-And there were 3,933 three-bedroom apartments in April of this year, down from 4,023 in April, 2011, with a vacancy rate of 5.8 per cent this year, down from 6.3 per cent last year.
The average monthly rate for this type of apartment was $1,048 this year compared to $1,029 in April, 2011.
Ontario had the third highest monthly rent on average at $1,014 behind Alberta and British Columbia.
The CMHC stated in its report on the study that an overall improving job market and the number of immigrants coming to Canada have caused the national rental vacancy rate to decline.
In Ontario, “downward pressure” on vacancy rates was partly due to people being reluctant to make the jump from renting to home ownership because of concerns about the sluggish recovery of the U.S. economy and the European debt crisis.
The rising cost of owning a home and a higher number of people between the ages of 25 and 34 finding jobs and having the means to move into an apartment or other rental unit were also factors in lower rental vacancy rates in April, 2012.
On the other hand, there were a number of factors putting upward pressure on vacancy rates.
These factors included a lower number of people migrating to the province since 2010 and the completion of a higher number of rental units in the past year, especially in places such as London, Windsor and Sudbury, translating to a higher degree of competition to retain and attract tenants.