The Affordability of Rental Apartments and Townhouses in Edmonton in 2020

The Affordability of Rental Apartments and Townhouses in Edmonton in 2020

The Canadian Mortgage and Housing Corporation released their annual rental market report a few months ago. The report analyzes market trends in large population centres in Canada for the year 2020. Included in the tables that accompanied the release of the report is data on the number of apartments and townhouses in the primary rental market by household income (organized into quintiles). Some of the data has to be interpreted with caution; however, it does provide us with a starting point for understanding the affordability challenges that many Edmonton renters face. Here is a version of the table:

The generally accepted affordability threshold for housing costs is no more than 30% of your monthly income. When it comes to the rental stock reported on in this table, an estimated 83% of the rental stock is unaffordable to those households living on less than $36,000/year. Put another way, an estimated 17% of the rental stock in the primary rental market is affordable to household living on less than $36,000/year. How many households fall into this category today? We will have to wait for the upcoming census data to answer this question.

In the absence of this data we can use other proxies. For example, households that rely solely on income support from Alberta Works and Assured Income for the Severely Handicapped (AISH) receive less than $36,000/year. In December 2020, the Alberta Works and AISH caseloads reported for Edmonton were 23,772 and 24,262 respectively. When it comes to affordable accommodation, the housing needs of this population are likely not being met by the private rental market, a sector that is supplying less than 12,000 units for rent under $900/month.

  • Joshua Evans, Research Lead, Affordable Housing Solutions Lab

Edmonton Rental Market – Year in Review (2020)

Edmonton Rental Market – Year in Review (2020)

Image Source: IQRemix; Link: https://www.flickr.com/photos/iqremix/42276507674/in/photostream/

The Canadian Mortgage and Housing Corporation released their annual rental market report a few weeks ago. The report analyzes market trends in large population centres in Canada for the year 2020.

Here are three highlights from the report for metro Edmonton:

  • Vacancy goes up, average rent stays the same

The vacancy rate in the primary rental sector reached levels (7.2%) not seen since 1995. This vacancy rate equates to roughly 5,188 units. While vacancy reached levels unseen in 25 years, the average rental cost remained roughly the same at $1,153.

  • Supply increases, with addition of higher rent units

The supply of rental units increased by 3.1% for a total of 72,061 units. The average rent for the new units added to the rental stock was 31.2% higher ($1,513) than the average rent of the purpose-built rental stock as whole.

  • Rental market still remains unaffordable for households in deep poverty

Only 15.1% of the rental stock in metro Edmonton is affordable to renter households with low incomes (households with annual income of less than $36K). Housing affordability stress is likely significant among households with children in this income category as only 2.5% of two-bedrooms and none of 3+ bedrooms are affordable to them.

Take-away: Affordability challenges persist alongside an increase in supply.

Joshua Evans, Affordable Housing Solutions Lab