Rent prices have stabilized across most of Canada throughout 2024 but have seen significant inflation in the province of Alberta. It’s important to understand this increase and what’s driving it, as well as how it affects both landlords and tenants. Read on to discover the ins and outs of Alberta rent prices and how they can affect you.
Overview of 2024 Rent Trends
Alberta’s rental market has seen a significant increase in rent prices in 2024, outpacing many other regions in Canada. According to the June 2024 report from Urbanation and Rentals.ca, Alberta experienced a 17.5% year-over-year increase in average listed rent prices, bringing the provincial average to $1,787 as of May 2024. This surge is particularly notable as many other Canadian regions, such as Ontario and British Columbia, have seen rent price stabilization or even slight declines.
Calgary, the province’s largest city, saw an increase of 6.2% year-over-year, with the average rent for a one-bedroom apartment reaching $1,733. Two-bedroom units also saw a jump to $2,140, a 6% rise. While Calgary remains a relatively affordable option compared to cities like Vancouver and Toronto, the consistent growth in rental prices is pushing the market higher.
Factors Driving Rent Increases
Several factors have contributed to the rapid growth of rent prices in Alberta in 2024:
Alberta’s Lower Rental Costs and Growing Demands
One of the biggest factors is Alberta’s traditionally lower rental prices compared to other provinces, leading to a significant influx in interprovincial migration. This migration is particularly evident in major cities like Calgary and Edmonton, which have seen significant rent price growth, but it’s also impacting smaller markets like Fort McMurray. This shift in population is driving demand for rental units, pushing prices higher across the board.
Rising Demand for Larger Units
Another factor driving Alberta’s rent price growth is the rising demand for larger rental units, particularly three-bedroom apartments. In Alberta, rents for three-bedroom units surged 21.3% year-over-year, reaching an average of $2,138.
The increased competition for larger units has amplified rent price growth in this segment, driving up overall rental averages.
Impact on Landlords and Tenants
So, what does this mean for the landlords and tenants of Alberta?
For tenants, the sharp rent hikes bring significant affordability concerns, potentially forcing them to make difficult housing decisions such as downsizing, relocating to more affordable regions, or even sharing accommodations to manage expenses. As rent prices continue to climb, competition within Alberta’s rental market is expected to intensify. These affordability issues are exacerbated by the sharp rise in rents for larger units, which can particularly affect families or larger households seeking spacious accommodations.
For landlords, rising rent prices can potentially increase profitability, as higher rental rates translate into greater revenue streams. However, as rents continue to climb, landlords may face difficulties in retaining long-term tenants, especially those who are sensitive to rising costs. Higher rents can also lead to increased tenant turnover since, as mentioned, some renters may relocate in search of more affordable housing options. This could result in landlords needing to invest more time and resources in tenant acquisition, potentially leading to periods of vacancy that can eat into profits.
Are rising Alberta rent prices affecting you? If you’re a landlord, GIL can help with tenant screening and expert property management, or if you’re a tenant, we can help you find affordable housing with favourable lease terms. Contact us or request a free property management consultation to get started today!
