COVID-19 pushing rents in small towns: “I can’t afford to live in the city where I grew up” – National

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When Christine Grice, a single mom, started looking for apartments to rent in Dundas, a community in Hamilton, Ont., In June, she said she was shocked at what she saw.It’s not just that a two-bedroom apartment now costs $ 1,795 in the same building where Grice rented a three-bedroom apartment for $ 1,650 just three years earlier.

It is because the rents seem to be climbing while Grice searches.

“Their website says $ 1,399 (per month) but… when you get there, it’s $ 1,499,” she says.

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Grice says she has noticed rapid increases in rent for both large professionally managed properties and basement apartments advertised on Kijiji.

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And the available units are being recovered at record speed, she says.

“You have to be quick,” she said, remembering how an apartment advertised for rent on Friday already had requests the next day.

“I think it’s ridiculous that I can’t afford to live in the city I grew up in,” she says.

Rental bid wars and cutthroat competition were routine rates in expensive markets like Toronto and Vancouver before the pandemic. But with the lifting of government restrictions and the resumption of activity in the rental and real estate market, part of this big-city frenzy is spilling over into neighboring small towns.

Hamilton saw a 37% year-over-year increase in rental transactions in June, says Mustafa Abbasi, president and chief revenue officer of online real estate market Zolo.ca, citing data from the Real Estate Association of Hamilton and Burlington.

At the same time, the average rent jumped 9% in July, from $ 2,200 to $ 2,400.

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The figures indicate a “substantial increase” in rental demand in the region, he said.

A similar phenomenon appears to be at play in Abbotsford, British Columbia, about an hour’s drive east of Vancouver, notes Abbas.

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There, rents rose 15.8% in June compared to the same period last year – one of the largest increases in Canada, according to Abbas.

These trends contrast sharply with what is happening in Toronto and Vancouver, where the pandemic is putting downward pressure on rents.

The average rent for a vacant one-bedroom unit in Toronto is down more than 9% from a year ago, while two-bedroom apartments are now 4.4% cheaper, according to an analysis of the Rentals.ca rental listings site.

In Vancouver, the average rent for a bedroom has remained virtually unchanged, while the average rent for two bedrooms is now 6.7% cheaper.










Money 123: Rent or own


Money 123: Rent or own

What drives rents up in small towns?

Part of what drives new tenants to smaller towns may simply be affordability. In a June poll of more than 16,000 renters across Canada, Rentals.ca showed that half said they should look for more affordable rentals due to the pandemic.

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The recession triggered by COVID-19 has disproportionately hit low-wage workers, labor market data shows. And low-income families are more likely to be renters.

But what is fueling rental demand in communities like Hamilton and Abbotsford is likely beyond financial necessity.

Much of this probably has to do with the shift to working from home, Abbas says.

“Consumers are also looking at their workspace: do they have enough space to work from home all the time?”

Workers who have been confined to typing from their studio couch crave more space. Parents who share the kitchen table with their children yearn for a home office.

At the same time, as employers get used to employees working remotely, people in large cities likely feel they can move further away from the office, Abbas says.

And while many tenants are likely looking for larger units, potential buyers are also adding to the pressure in small town real estate markets, he adds.

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Coronavirus: How practical is working from home in the long run?


Coronavirus: How practical is working from home in the long run?

In Hamilton, Royal LePage agent Joe Ferrante says he’s seeing this trend firsthand.

Toronto owners sell in the city with the intention of buying in Hamilton, but once they get there they end up renting because they can’t find what they want in a limited inventory of properties in sell.

In cities large and small, real estate agents have reported a decrease in inventories of homes for sale, as buyers rushed to buy a property to take advantage of low interest rates and beat the landmark July 1 start date. the introduction of stricter rules for home buyers. for mortgage loan insurance from the Canada Mortgage and Housing Corporation (CMHC).

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In Hamilton, many prospecting buyers “are forced to rent because there is no product,” Ferrante says.

The upward trend in rental demand in small towns surrounding large cities is not universal, Abbas says.

In Montreal, for example, tenants and buyers always seem to gravitate around the city itself, likely because it remains more affordable than Vancouver and Toronto, he says.

But rental demand in small towns seems widespread.

“Renters are now prioritizing affordability and space rather than paying more for amenities in big cities, which most cannot currently use,” read the July rent report. Canada. PadMapper, which aggregates rental listings online.

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Rents in Barrie, Ont. and Burnaby, BC, are both up 7.6% from the same period last year, the report notes.

And Rentals.ca claims to have seen unique pageviews for a number of southern Ontario communities increase between March and June of this year. Innisfil – one hour and forty minutes north of Toronto – saw a 124% increase in user interest. And Newmarket, London, St. Catharines and Niagara Falls have all increased by over 70%.

As Torontonians come to Hamilton, Hamiltonians move to St. Catharines and Niagara Falls, says Ferrante.

For her part, Grice is still hoping to find an apartment in Hamilton that she can afford with her salary of $ 60,000.

She wants to find a place where her 13-year-old twin daughters can visit their friends without having to get in the car, she says.

“I am looking for whatever I can afford.”

© 2020 Global News, a division of Corus Entertainment Inc.



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