Canada’s asking rents fall for 24 straight months

Canada’s rental market has recorded 24 consecutive months of annual price declines, the longest downturn in recent histor. Average asking rents fell 4.2% year-over-year in September to $2,034, according to the National Rent Report from Rentals.ca and Urbanation.

The reading leaves asking rents 9.2% below their May 2024 peak of $2,202 and 7.3% lower on a cumulative two-year basis.

Supply driving the correction

Supply, not weakening demand, is the primary force behind the prolonged downturn, according to Urbanation president Shaun Hildebrand.

“Our research shows supply has been the main driver of this correction, and in key markets like Toronto and Vancouver, new supply is moving past its peak,” Hildebrand said.

“Rents in both cities have trended higher over the past six months, and annual declines have narrowed significantly as renters come off the sidelines. Where Toronto and Vancouver go, the rest of the country follows.”

The data showed divergence by property type. Purpose-built apartments recorded the smallest annual decline, falling 2.7% to $2,036.

Condominium apartments took the steepest hit, down 7.8% to $2,052, led by a 9.6% drop in studio condo rents.

Secondary market units such as houses and townhomes fell 7.4% year-over-year to $2,016.

Further condo price declines may still be needed before the segment recovers, a challenge that is complicating client conversations and appraisal conditions in volatile urban segments.

Christine Xu, founder of Money Broker Canada and a 26-year industry veteran, put the situation plainly at MortgageFest Canada 2026.

“A lot of those people are racing masters — they invest in a whole bunch of pre-construction condos and they are being hit the most,” she said.

“We see bankruptcy all over the place.”

Provincial picture and the affordability outlook

The correction has been uneven across provinces. Ontario saw asking rents fall 4.8% year-over-year, British Columbia 2.9%, Alberta 2.6%, and Quebec 1.7%. Saskatchewan and Nova Scotia each posted 1.4% gains.

On a per-square-foot basis, average rents across Canada’s six largest markets came in at $2.48 in September 2026, down 1.5% from September 2025.

Separate figures from Statistics Canada cited in the report show average weekly earnings have risen 19.4% over the past five years, a measure the report used to illustrate a gradual improvement in rental affordability.

However, falling asking rents have not resolved Canada’s rental affordability crisis, with renter budgets remaining deeply misaligned with market pricing in most major cities.

A structural signal worth watching: Canada’s rental vacancy rate dipped for the first time in two years in Q2, a shift that Yardi’s multifamily data attributed to supply pipelines approaching their ceiling.

The Rentals.ca and Urbanation report identified peaking construction inventories, modest revised population growth, and limited tariff exposure in both cities’ labour markets as conditions that could support a return to positive rent growth in Toronto and Vancouver.

That inflection, the report concluded, may be closer than two years of uninterrupted declines suggest.

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