THUNDER BAY – Business – Thunder Bay has a 1% vacancy rate. Rental properties in the city are one of the hottest commodities around. On Social Media sites like Facebook it is not unusual to see people posting messages literally begging for information on a rental unit.
Thunder Bay’s vacancy rate is lower than the Ontario average.
Rental Market Could Hamper Economic Activity
According to Canada Mortgage and Housing Corporation’s (CMHC) Spring 2013 Rental Market Survey, Ontario vacancy rates(1) edged higher to 2.6 per cent in April 2013, up from 2.3 per cent in the spring of 2012. With the universe of purpose-built rental units remaining unchanged, demand factors were entirely at play impacting vacancy rates this spring. Vacancy rates moved higher for bachelor (2.7%), 1-bedroom (2.7%) and 2-bedroom (2.5%) apartment units while remaining stable for three bedroom (2.2%) units. South western Ontario and selected Northern Ontario communities posted lower vacancy rates while some southern and eastern Ontario centres experienced more accommodating rental market conditions. The lowest vacancy rate was registered in Toronto (1.6%) and Guelph (1.6%) while the highest vacancy rates were registered in Windsor (6.3%) and Ottawa (3.7%).
Factors Exert Pressure on Market
“Some prominent factors dampened rental demand and exerted upward pressure on vacancy rates. Modest job growth and less in-migration moderated demand for rental housing in Ontario. Other factors were more supportive of rental demand. The rising cost of home ownership in Ontario restrained “big ticket” spending across the province since the spring of 2012. Consequently, tenants considering the jump to more expensive ownership housing likely postponed this decision,” said Ted Tsiakopoulos, CMHCs Ontario Regional Economist.
While the very low vacancy rate has advantages for property owners and landlords, it also has impact on potential economic development in the city. As new companies locate to Thunder Bay to get in on the Ring of Fire and other mining opportunities, the hot real estate market is an issue that impacts their employees.
For others in the community, especially youth and Aboriginal youth the tight real estate market for rental properties is another issue they face in adapting to the city. Many young people seeking a home are facing higher prices or a fruitless search. One issue facing landlords, and prospective landlords is the Ontario Landlord Tenant legislation that puts very little power in the hands of small landlords.