#Canada #Toronto #Real Estate #Yardi Canada #Canadian Rental Market

Canada’s Rental Market Sees a Shift

As we move into 2026, the landscape of Canada's rental market is experiencing significant changes. A recent report by Yardi® has highlighted these developments, depicting a market that, while remaining generally robust, is beginning to normalize as vacancy rates increase and rent growth decelerates in major metropolitan areas.

Overview of Q4 2025 Trends

According to Yardi’s Canadian National Multifamily Report, the fourth quarter of 2025 has seen a noticeable shift in dynamics. This transition is largely driven by an influx of new rental supply that has been introduced to the market. The report indicates that Canada's six major Census Metropolitan Areas (CMAs) added 94,611 units by the end of November 2025, a 1.9% increase from 92,830 units during the same period in 2024. This surge in supply has been facilitated by continued efforts from the Canada Mortgage and Housing Corporation (CMHC) to alleviate housing shortages. As the market adapitates to this added inventory, conditions are becoming more balanced.

Slowing Rent Growth

While the increase in rental units is helping to meet the demand, it also brings about moderation in rent growth. The report reveals that the growth of new lease rents has slowed to a mere 0.7% on a national level for Q4 2025. This slowdown is particularly pronounced in certain regions of Ontario, where several key markets have entered negative rent growth. For instance, Kitchener–Cambridge–Waterloo reported a decrease of 2.7%, Toronto saw a fall of 1.0%, and Hamilton experienced a drop of 0.2%. The overall vacancy rate across Canada has now climbed to 4.5%, the highest level recorded since Yardi began its tracking in 2020.

Regional Differences in Operating Costs

The report discusses the disparity in operating costs, which have been markedly different across provinces. In 2025, the average annual expenses per unit amounted to $8,004 nationwide. However, Ontario recorded the highest figures at $8,822 per unit, followed closely by Alberta at $8,044. In contrast, provinces such as Nova Scotia and Saskatchewan reported significantly lower operating costs, at $6,616 and $6,727 respectively.

The Future of Canada's Rental Market

Peter Altobelli, Vice President and General Manager of Yardi Canada Ltd., emphasized the significance of this moment for the rental market. He stated, "Canada's rental market is entering a new chapter. We haven't seen this level of new purpose-built rental supply in a long time, and it's already shifting market conditions." As the market continues to adjust, the necessity for reliable and timely data will be crucial for housing providers making informed decisions surrounding pricing, operations, and investments.

The Canadian National Multifamily Report draws its conclusions from an extensive dataset comprised of 5,900 properties that represent over 517,000 private rental units across the nation, offering valuable insights into rental prices, vacancy rates, supply trends, turnover rates, and resident retention strategies.

For more in-depth analysis and access to the full report, visit yardi.com/cndmultifamilyreport.

Conclusion

As Canada's rental market navigates these changes, stakeholders must remain vigilant and responsive to emerging trends. Understanding the evolving landscape will not only benefit property owners and managers but also residents looking for stable housing solutions.