Rent Up 8.5% Year over Year in March 2024
Rent prices continue to surge unabated in Canada.
Rental accommodation CPI is up 8.5% year-over-over in March, according to Stats Canada’s March CPI Data released this morning.
This reflects the largest increase in rent prices since March 1983, when they were up 8.7% year-over-year.
Higher Interest Rates, Population Swell to Blame
Statistics Canada blames rental price increases on the “higher interest rate environment, which can create barriers to homeownership, put upward pressure on the index”, but supply also plays a factor.
Canadian Population up 1,271,872 in one Year
The latest population count has Canada’s population up 1,271,872 people compared with January 1, 2023. This represents the highest annual population growth rate since 1957.
97.6% this population growth came from international migration, according to Stats Canada.
If the Government of Canada fails in its plan to curb migration, Canada on track to experience another annualized population gain of 2.4% in 2024.
Lowest Rental Vacancy Rate Since Records Began
All of these additional people have put pressure on Canada’s rental accommodation stock, driving down vacancy rates to all-time lows of 1.3%.
Mortgage Interest Costs Up as Well
It’s not only renters who are struggling — as Canadian homeowners renew their mortgages they are renewing into multi-decade high interest rates.
This pushes up the aggregate average cost of mortgage interest, as measured by Statistics Canada.
In fact, the mortgage interest cost index rose 25.4% YoY in March, after a 26.3% increase in February.
Canadian Struggle Financially
A recent TransUnion Consumer Pulse study shows that almost half (43%) of Canadians surveyed felt their household finances are worse than planned.
“The impact of higher interest rates and cost of living created increased vulnerability among Canadians, Consumers are forced to make trade-off decisions on how to allocate their disposable income in a more expensive environment.”
– Matt Fabian, director of financial services research and consulting at TransUnion Canada.
Food Charity Usage At All Time Highs
All of these price pressures have Canadians leaning on food charity more than ever.
According to Food Banks Canada, there are over 1.9 million visits to food banks every month in Canada, far surpassing last year’s usage, which also set a record at the time.
The tops reasons citied for Food Bank usage?
- food costs
- housing costs,
- and low wages or not enough hours of work.
36% of Food Programs in Canada Are Forced to Turn People Away
A recent Harvest House study also concluded that there will be an 18% increase in demand for food charity in Canada in 2024, and that 36% of non-profit food programs across Canada are currently forced to turn people away.
