Population shift puts Canada’s rental and condo markets to the test
Ottawa is targeting a reduction in the non-permanent resident share of the population, from a peak of 7.6% to 5%, signalling further outflows ahead. Those temporary foreign workers and international students had previously absorbed significant rental supply across the country.
Rental supply flood
The timing could hardly be more consequential. That demand pullback has arrived precisely as Canada’s construction pipeline reaches a record depth.
More than 180,000 rental units are currently under construction nationally, according to BMO Economics, and for the first time, rental units under construction now outnumber combined condo and homeownership units.
The surge reflects previously tight conditions that set projects in motion years ago, alongside federal financing incentives for purpose-built construction.
The effect on rents has been immediate. National asking rents hit a three-year low in May, falling 4.7% year over year, said BMO Economics. Within the Consumer Price Index, rent inflation has eased to 3.5% annually from a high of 9.0% reached in 2024.
