Hot Real Estate Canada

Mar 13, 2007 - Linknet Real Estate News

Saskatoon renters feeling the heat from hot rental market - The boom that has been driving the economies of Canada's western provinces has been pushing up rents in Saskatoon.

According to Canada Mortgage and Housing Corporation's (CMHC) 2006 rental market report, the average monthly rent for a two-bedroom apartment in Saskatoon was $608 last year, and will likely climb to $650 this year.

The rental housing vacancy rate in Saskatoon is predicted to decline to 2.5% in 2007. Many new jobs resulting from the vibrant economic growth in the west are bring a steady flow of new rental households into the city.

Rental increases normally result when apartment buildings are sold to new owners. New owners make upgrades and improvements and rents must increase to cover the extra costs. Rent controls, if applied, would be legislated by the provincial government, but Saskatchewan's experience with rent controls has not been good. With rent controls developers are more likely to turn buildings into condominiums, leaving renters with even fewer available apartments to choose from.

Rising rents have already hit British Columbia and Alberta Between October 2005 and October 2006, average monthly rents shot up by 19.5% in Calgary and 9.9% in Edmonton.

Saskatoon city officials expect the market to work its sometimes painful magic. If rental rates go too high, renters who cannot afford the increases will move to lower priced units, and building owners will moderated their increases accordingly.