In a recent article, Doug Porter, Chief Economist for BMO, revealed a startling reality: rents in Canada have surged by 8.2% year over year, marking the fastest pace since 1983! Moreover, for the first time in 60 years of records, income growth has trailed behind rents by a significant margin. These figures set the stage for a profound discussion with local Property Manager and founder of Greater Vancouver Tenant and Property Managment, Keaton Bessey.
Adding to the narrative, November's Report from www.Rentals.ca highlights that the annual rate of rent growth in Canada was 9.9% in October, the second-fastest increase in the past seven months. Vancouver leads the pack with astonishing average rent of $2,872 for a 1-bedroom and $3,777 for a 2-bedroom, while Burnaby closely follows, surpassing Toronto at $2,647 for a 1-bedroom and $3,341 for a 2-bedroom.
Armed with these facts, we delve into a series of questions with our esteemed guest, a seasoned property manager with 13 years of experience, to unravel the mystery of how we got to this point and whether it was an inevitable outcome as soon as home home prices began their surge.
We shed light on the potential impact of the current economic conditions on the rental market and with signs pointing to a slowing economy, we explore whether lower GDP output and a possible recession could be key factors affecting rental prices. Will an economic downturn slow down rent increases, or is it fundamentally a supply-related concern?
On the more contentious topic of rent controls, particularly in Vancouver, where opinions are divided, Keaton provides unique insights into whether rent controls work, and if not, what alternative solutions might exist to address the soaring rents and the city's distinction of having the highest average rent in the country.
We also look at rent collection under the current economic climate as it's a great indicator of where the economy lies as well as we look examples of renters breaking leases and what it means for both tenants and landlords. We also put Keaton on the spot as we ask him to peer into his crystal ball as we explore predictions on future rental rates. Will they go up or down, and what factors contribute to this projection?
Finally, the conversation touches on immigration and its impact on the rental market. Despite staggering immigration numbers, we explore why many newcomers don't transact until they earn their permanent residency as well as touching on how to rent to new commers and the steps you should take as a landlord to protect yourself.
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Dan Wurtele, PREC, REIA
604.809.0834
Ryan Dash PREC
778.898.0089
ryan@thevancouverlife.com