Anshu Arora LLM, MSc, PMP

Rental prices in Canada reached a new high, with an average asking price of $2,149 per month in October, according to a new report compiled by a Canadian rental listings website(opens in a new tab).

According to Rentals.ca and real estate research firm Urbanation, the Canadian market continued its upward trajectory with data suggesting a monthly increase of 1.5 per cent from August, and an annual surge of 11.1 per cent. Experiencing double-digit year-over-year growth, the annual rate of rent inflation surged to its highest point in nine months, stated the report.

The report’s metrics are based on new listings, not what existing tenants are paying per month. In terms of rental types, one-bedroom units recorded the fastest annual growth in asking rents, soaring by 15.5 per cent, reaching an average of $1,905. Two-bedroom apartments averaged $2,268, marking a 13.1 per cent increase year-over-year, while three-bedroom units were up by 11.4 per cent, averaging $2,514.

Studios, representing the most economical choice, had the lowest year-over-year growth with an increase of 11.3 per cent, averaging $1,511 in rental prices. Asking rents for purpose-built and condominium apartments averaged a record high of $2,078 in September, increasing 1.6 per cent month-over-month and 13.3 per cent year-over-year. Nova Scotia surpassed Alberta with the average asking rents for apartments by reaching $2,088, while Alberta rose to $1,663. Quebec had the third fastest annual growth with a rate of 13 per cent, followed closely by British Columbia with 12.3 per cent.

In Ontario, the annual rate growth slowed from 9.9 per cent in August to 6.6 per cent in September. Asking rents in the province also declined by 0.4 per cent month-over-month. Yet, despite this glimpse of financial hope, Ontario still has the second highest rent average by province at $2,486. The Prairie provinces remained the most financially friendly locations as Saskatchewan and Manitoba both had the slowest annual rent growth in September at 3.8 per cent and 3.1 per cent, respectively. Saskatchewan’s asking rents averaged $1,115 and $1,431 for Manitoba.

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On Oct. 20, Mississauga Mayor Bonnie Crombie came back from her temporary leave to overrule a previous rejection by city council and allow the building of four-unit housing on low-rise residential lots.

The move not only kept Mississauga in the running for a federal housing grant, but it also added the city to the growing list of municipalities around Canada pushing through massive zoning changes to address Canada’s housing crisis.

Since the federal government’s $4-billion Housing Accelerator Fund was launched in May of this year, cities have been rushing to claim the incentives that are tied to zoning changes. In the last few months, the Ontario cities of Brampton, London, Vaughan and Hamilton, as well as Halifax and Kelowna, have all signed agreements with the federal government. Others, like the Ontario cities of Mississauga, Kitchener and Burlington, as well as Calgary, were making significant gains in zoning changes.

This has led some experts to argue that Canada was witnessing nothing short of a zoning “revolution.” In much of the country, zoning restrictions mean developers are allowed to build only single-family homes or condo towers in residential areas. There is a huge chunk of housing options, often referred to as “missing middle housing,” that does not get built. “It’s been really fascinating to watch how quickly that’s happened after almost 50 years of that (single-family) zoning being locked in place,” Carolyn Whitzman, a housing policy expert and expert advisor to the Housing Assessment Resource Tools Project, told Global News this week.

Whitzman said cities around Canada are beginning to realize that single-family zoning is not only serving them poorly but is exacerbating the housing crisis. “Zoning came in in the 1920s, so it has a century of use in Canada,” she said. “They were made much stricter in terms of suburban redevelopment from about the 1960s and 1970s onward. So now, you’re talking about one or two generations that really can’t imagine any other (kind of) development happening.”

James McKellar, professor emeritus of real estate and infrastructure at York University’s Schulich School of Business, said Canadian cities need to adapt zoning rules to allow for housing that better meets the needs of Canada’s population. Part of the reason many cities are accelerating the pace of change is the federal government’s Housing Accelerator Fund. The federal government is pushing municipalities to make rapid zoning changes. This includes pushing municipalities to build more fourplex and mixed housing units.

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Fees associated with building new residential and non-residential buildings across Metro Vancouver will go up significantly over a three-year period between 2025 and 2027. In a public meeting today, Metro Vancouver Regional District’s board of directors approved the recommendations and framework by regional district staff to exponentially increase the development cost charges (DCCs) associated with new building developments.

Depending on location, the combined total DCCs rate increases for residential projects are $18,506 to $24,106 per single-family lot, $16,952 to $22,182 per townhouse unit, and $11,360 to $14,657 per apartment unit. While builders and developers will cover the cost of these fees, it is assumed that the resulting added costs to construction will be passed on to residents through a higher sale price or rental rate. These fee hikes will help fund a significant portion of the regional district’s $35 billion plan over the next 30 years to expand and improve the regional network of water supply and sources, sewerage capacity, and regional parks to meet the needs of the region’s growing population and economy and renew aging infrastructure. The single most expensive project is the new Iona Island Sewage Treatment Plant facility near Vancouver International Airport which will cost over $10 billion.

The highly controversial “growth pays for growth” strategy has been met with much criticism from the development industry, some municipal officials, and even the federal government, which first indicated its opposition in September by delaying the federal Housing Accelerator Fund to Burnaby and Surrey. In an open letter earlier this week ahead of today’s decision, Federal Minister of Housing Sean Fraser reiterated the federal government’s position against the added costs to building development and the impact that it would have on addressing housing affordability and supply. “Given the spirit of the Housing Accelerator Fund and the work that the federal government is doing to change the financial equation for builders, large increases in development charges are at odds with these goals,” wrote Fraser.

The minister challenged the “growth pays for growth” strategy, as “we will all pay for stagnation as a result of a lower pace of construction. A ‘growth pays for growth’ approach ignores the value that new development, new property tax bases, new businesses, and new neighbours bring to our communities. I am concerned that at this particular moment in time, a drastic increase in development charges will inhibit our ability to seize the opportunity to incentivize a rapid increase in construction.” Fraser requested the regional district’s board of directors — comprised of the elected municipal officials of Metro Vancouver’s municipal governments — to delay the start date of the new DCCs and implement exceptions for secured purpose-built rental housing.

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Interest in de-dollarisation is increasing given growing financial fragmentation risks worldwide, according to a report, but there is still not a credible alternative to the US dollar despite yuan internalisation efforts, political and financial leaders said at a forum at the weekend.

The report by the International Finance Forum (IFF) attributed the trend of using regional currencies rather than the US dollar to the adverse spillovers of unprecedented US monetary tightening.The US Federal Reserve raised interest rates 11 times in 17 months, hitting a 22-year high in July. “[De-dollarisation] could be one of the unintended consequences of the financial fragmentation,” the IFF report released on Saturday said.

 

Financial sanctions could be weaponised, along with other forms of restrictions including embargoes, trade wars, seizure of assets, limiting access to capital and technology and screening of investments, which could eventually lead to global financial fragmentation, the report warned.However, political and financial leaders said at the IFF in Guangzhou on Saturday that there is not a credible alternative major currency that could absorb much of the global operations occupied by the US dollar.

The 2023 Global Finance and Development Report by the IFF echoed research released by the PBOC on Friday, which showed the yuan’s share in global payments, trade finance and central bank reserves is still far behind the US dollar despite progress in the past decade.

Hong Kong-based Mandarin Oriental is the best luxury hotel brand in the world, according to the latest annual ranking by LTI – Luxury Travel Intelligence, and two other brands in Hong Kong feature in the top 12. LTI is a global members-only organisation that provides digital reporting for affluent travellers “based on our honest and detailed intelligence”. Each year, the organisation assesses luxury brands that own or manage 10 or more properties according to a number of touch points relevant to the luxury hotel sector.