There are fewer “for rent” signs in Red Deer than there have been in recent years, experts say.
Rental vacancy rates in Red Deer are declining, noted Central Alberta Realtors Association president Richard Pochylko, based on information from the Canadian Mortgage and Housing Corp. and his own experience.
He said the current mortgage requirements set by the federal government have “probably made it difficult for some people to qualify to be homeowners.” This means they’re forced to stay in the rental market longer, he said Tuesday.
“It’s (also) partially due to the fact that we’ve probably stopped seeing decline in population and we’re stabilizing.”
In December, the average property on Rentals.ca was listed for $1,776 per month in Canada overall, an increase of 1.3 per cent month over month, according to the organization’s January report.
According to the assessment, the average monthly rent in December for a one-bedroom unit in Red Deer was down one per cent from the previous month, to $976. The average December rent for a two-bedroom unit was up two per cent to $1,120.
This placed Red Deer in the 20th spot, out of 25 municipalities listed in the national assessment.
Toronto ranked first, followed by Mississauga and Vancouver.
The average monthly rental (overall) for condominium and rental apartments in Red Deer has increased from $1,052 in October, $1,080 in November and $1,129 in December. The increasing monthly trend in Red Deer was consistent with Calgary and Edmonton. During the same period, the Greater Toronto Area saw a decline, with Ottawa as an exception.
In a statement by Rental.ca, Bre Fitzpatrick, land and economic development officer with the City of Red Deer, agreed the rental market is picking up.
She said “while not based on statistics, there’s a more optimistic look at rentals” in Red Deer.
Pochylko noted rental incentives, such as the first month free, have been reduced significantly since around 2017.
Fitzpatrick agreed, adding, “there appear to be fewer signs stating ‘free rent for first three months,’ that we had seen in prior years, which indicates our landlords are seeing rentals filling in.”
Fitzpatrick said, “we are hearing that renters with pets or who smoke are finding it more difficult to secure properties that will accept them, as more renter options are available to landlords,” noting that this information was not based on statistics.
On the horizon for 2019, Fitzpatrick said construction will be finished on two new condos in the downtown area, and there will be more construction in areas such as Vanier, Laredo and possibly Evergreen.
She listed the Westpark and Bowers areas as strong and growing rental markets because they are close to Red Deer College and the Gary W. Harris Canada Games Centre.
Pochylko said the rental market is balanced, which is a win-win for both tenants and landlords, adding that this trend will favour landlords in 2019, but not by much.
“Vacancy rates will come down a little bit, but it’s not going to be a major change, so it will still stay pretty balanced,” Pochylko said.
Fitzpatrick believes “millennials will face deeper challenges in qualifying as home purchasers as we look ahead” in Red Deer. She added that more rentals will be needed as Red Deer College transitions to a university.
Pochylko said “the renting trend” will continue in major centres such as the Greater Toronto Area and Lower Mainland, but not in cities such as Red Deer, where owning is affordable.
“Across the country, when you get away from those two areas, housing is still actually pretty affordable for most people,” he said.
“It’s the same as it was when I was a kid – numbers are higher, but it’s the same affordability rate.”
Rentals.ca based the report on its data and from interviews with 16 housing experts around the country.