Housing Outlook - Winter Housing Overview

Canada’s winter weather usually brings a “chill” to the country’s housing market, resulting in fewer rentals and house sales as people wait for spring’s warmer temperatures. However, Canada’s continuing housing crisis doesn’t permit housing hibernation. Finding affordable housing in Canada remains THE critical first challenge for newcomers looking for a successful new beginning.

So, a newcomer’s winter path to housing success, and ultimately homeownership, begins with understanding the current Canadian housing market and selecting the right city or region in which to settle. Keeping affordability and availability as the focus of your housing research will enable you to find that first permanent rental home in the right location that fits your budget and housing goals.  Following this path will save you time and money and set you and your family up for long-term housing success and home ownership in Canada.

Why is it essential for newcomers to understand housing affordability and availability before arriving in Canada?

It’s simple: Settling in the wrong city or region means paying high rents, and thus limiting your ability to save money to buy a home. Settling in an expensive, unaffordable housing market may result in you and your family having to relocate to achieve that goal of home ownership somewhere else. As many newcomers have discovered, relocation can be an expensive and painful experience that involves finding new jobs, schools, friends and connections.

Understanding the relationship between home-buying prices and rent prices before arriving in Canada is crucial to making smart long-term housing decisions that lead to homeownership.

It’s important to remember that your housing cost of living—paying rent or a mortgage—will always be your biggest monthly expense, so choose a city wisely.

Dave Frattini, Managing Partner of Destination Canada Information Inc. (Prepare for Canada and Rentals for Newcomers), says newcomers who want to become homeowners need to pay attention to rental and home-buying housing market trends in the city where they plan to settle.

“The decision to land in a large city like Toronto or a smaller city such as Regina can have a big impact on a newcomer’s plans and ability to save for and eventually buy a house,” said Frattini.

“And always remember that settlement agencies can play a pivotal role in helping you select the city that is right for you, both in terms of employment, rental housing and eventual home ownership.”

A 2024 Leger study revealed that 80 percent of newcomers settling in Canada since 2014 discovered after arriving that rents and house prices were more expensive than they thought.

Also, finding that first permanent rental home inevitably takes longer than many newcomers anticipate, so budgeting accordingly for the cost of short-term rentals is essential.

In the first half of 2024, rental searches in many parts of Canada could take up to eight weeks. However, a new survey from Rentals.ca shows that because of the recent reduction in the number of international students entering Canada, rental availability has improved in some Canadian cities, resulting in shorter rental search times.

While most newcomers hope to find their first permanent rental home within four weeks, it can take longer than you think, so be financially prepared.

Registering for a Prepare for Canada webinar can help you prepare for the realities of the Canadian housing market.

If owning a home is your goal as a newcomer to Canada, it’s critical that you choose your landing city strategically.

Picking the wrong city or region to settle in can derail your dream of home ownership. Home prices in many Canadian cities have risen significantly in recent years, and despite falling in the past year in major cities such as Toronto and Vancouver, they remain well above 2019 levels.

A 2024 Angus Reid survey revealed that Canada’s continuing housing affordability crisis has hit immigrants hardest.

The survey discovered that 39 percent of newcomers who have lived in Canada for less than 10 years have considered leaving their province because housing costs are too high.

This reinforces the reality that if home ownership is your goal, you must choose your destination carefully. As mentioned, you don’t want to be faced a few years after arriving with a painful and costly relocation in search of an affordable home to buy.

The Canadian rental market is trending in the right direction for newcomers arriving in Canada this winter.

Rent prices are falling steadily but slowly in many Canadian cities, most significantly in the popular landing spots of Toronto and Vancouver. The availability of rental properties in cities with universities and colleges is improving due mainly to the reduction in the number of international students entering the country.

There has also been a significant increase in rental construction in Canada over the past five years.

This drop in rent prices and rental demand is expected to continue this winter and is creating a renters market in Canada, according to David Aizikov of Rentsync.

“We are transitioning into a renters market,” said Aizikov in a recent national renting report.

Aizikov said newcomers looking for a rental in Canada “are in a stronger position when looking for new housing than they would have been anytime in the past two years. ”

However, affordability and availability remain rental housing challenges for newcomers to Canada arriving this winter.

Despite the price drops, rent prices are still at record highs compared to a few years ago, and vacancy rates in most cities are still well below the normal range of 3 percent (in some cities, they remain just above 1 percent).

So, while the rental landscape for newcomers to Canada is improving, challenges exist, and choosing the right city to settle in remains critically important to their success.

Still, the good news is that rent prices are generally falling. Because of an oversupply of condos—particularly in Toronto and Vancouver—more rental properties are becoming available in those two cities, and this trend is also expected to continue into the spring.

Rent prices continue to rise in a few popular mid-sized cities, such as Ottawa and Niagara Falls, as newcomers select to settle there, mostly because of cheaper housing prices.

Over the course of 2024, average rent prices overall rose substantially in Saskatchewan, Atlantic Canada, Alberta and Manitoba. Whether this will be the pattern in 2025 is uncertain but rent hikes are not forecast for the winter months.

Nationally, Western Canada and the East Coast cities are forecast to have the best rental bargains over the winter months.

The most recent monthly surveys by Rentals.ca show that cities such as Saskatoon, Fort McMurray, Regina, Edmonton, and Winnipeg consistently feature the cheapest rents in Canada.

Rents in the Greater Vancouver and Toronto Areas are consistently the most expensive in Canada, and asking rents are far higher than those in Western Canada and smaller cities across the country.

This rent price disparity is a permanent feature of the Canadian rental housing market and will remain unchanged into the spring and beyond.

This disparity in rent prices can be frustrating for newcomers looking for affordable housing.

For example, according to recent rental data, a one-bedroom apartment in Toronto rents for $2,380 monthly.

At the same time, a one-bedroom apartment in Regina rents for $1,296.

That’s a rent price difference of $1,184 a month!

Here’s another example: A two-bedroom apartment in Vancouver costs $3,430, while a two-bedroom apartment in Oshawa is $2165. That’s a difference of $1,375.

The Canadian rental reality is that the further you settle away from Canada’s major cities and most populated provinces (Ontario and B.C.), the less rent you’ll pay.

Ontario is still the most popular Canadian province with newcomers. The current disparity in rent prices between Windsor (Ontario’s most affordable mid-sized city) and Toronto is just over $800.

While housing is the single most significant cost of living item for newcomers, other savings besides rent in Canada’s mid-sized and smaller cities can be substantial. For example, insurance, repairs, goods and services can cost less. Also, Canada’s inflation rate is at 2 percent as we enter the winter season, and no significant increase is forecast.

Regardless of winter rental trends, there’s a guideline that doesn’t change: Newcomers should pay no more than between 30 to 35 percent of their monthly gross (before tax and other deductions) income on rent. However, according to Statistics Canada, in a lot of Canadian cities, many domestic and immigrant renters pay more than 35 percent of their monthly income toward rent, with some paying as much as 50 percent!

This reinforces why affordability and choosing the right city are so crucial to newcomers.

For example, suppose your gross pay as a newcomer is $4,500 a month. In that case, you should budget $1,575 a month as your rental housing costs, according to the 35 percent guideline. The city of Windsor, Ontario, where rent for a one-bedroom is around $1,550 a month, is affordable and fits your budget.

Toronto, where rent for a one-bedroom is around $2,400 a month, DOES NOT. You’d need to earn $6,800 monthly (or about $82,000 annually) to comfortably afford an average one-bedroom in downtown Toronto.

Here’s another tip for newcomers who aspire to home ownership and aren’t keen on relocating: Canadian cities with cheaper rents also have more affordable housing prices.

The fall average price for a home in the Toronto region (where rent is $2,443 for a one-bedroom apartment) is $1,060,300.

The price for a home in Winnipeg (where rent for a one-bedroom is $1,382) is $361,400.

That’s a difference of $709,900 in the cost of a home between Toronto and Winnipeg.

Winter is traditionally a slow period of the year for home sales in Canada.

In the fall of 2024, sales in the Canadian housing market reached their highest mark in over two years. Housing experts credited this to lower borrowing costs and mortgage rates, which have enticed eager buyers (many of them renters) into the housing market, which now features a larger supply of homes for sale.

Beginning in June 2024, the Bank of Canada cut its key interest rate four times, from a high of 5 percent to 3.75 percent. Economists expect more cuts in winter 2025, which Canadian housing experts believe will lower mortgage rates further and thus drive more sales.

The average home sale price in Canada in October 2024 was $696,166, up 6 percent from October 2023.

At the end of October, 174,458 properties were listed for sale in Canada. That’s an increase of 11.4 percent from October 2023.

While housing experts believe home prices will rise in the spring, most forecast modest price increases – for now. However, many factors (interest rates, inflation, the job market, trade relations with the U.S., etc.) could alter their spring price forecasts higher or lower.

In Canada, the housing journey for most newcomers involves renting, saving, and buying. After several years, more than 70 percent become homeowners.

According to a survey by Ipsos Research, newcomers to Canada are becoming homeowners quicker than ever.

• Many newcomers to Canada are homebuyers within the first five years of arriving.
• Immigrants to Canada are more focused on owning a home overall than non-newcomers.
• Among the newcomers living in Toronto, 49 percent now own homes after being here less than five years.

Although Canada recently reduced its permanent resident target from 500,000 to 395,000 in 2025, down to 380,00 in 2026, and set a target of 365,000 in 2027, that’s still a lot of competition for rentals.

Those figures do not include the still sizeable number of international students and temporary foreign workers who will also arrive in 2025 seeking rental accommodation.

While the Canadian rental market will continue to tilt in favour of renters over the winter months, it remains essential that you sell yourself as a tenant to landlords.

To help you succeed in finding your first permanent Canadian rental, Prepare for Canada has created a guide that shows newcomers how to craft their application forms and listing inquiries so they can stand out in this still competitive rental housing environment.

If finding a rental on your own feels overwhelming, other rental solutions for newcomers exist in Canada.

Newcomers can get ahead of the competition in finding their first rental by working with certified, experienced real estate agents. This no-cost solution sees the real estate agent find the rental for you. This option is attractive to qualified newcomers focused on finding a job or have arrived with one and are now too busy with work and family to look for a rental.

Another stress-free rental solution is home-sharing.

If you qualify as a housemate, you live with the homeowner in their home. Being a housemate is cheaper than being a roommate. It offers many more amenities (better housing, location, a knowledgeable, friendly host, security, etc.) and other advantages.

You can learn about these free options in by registering for a Prepare for Canada webinar

• Register for Prepare for Canada’s FREE Canadian Connections Housing Summit.
• Follow news that affects housing, such as interest rates and inflation.
• Register for FREE for Rentals for Newcomers.
• Discover all about home-sharing and how to become a housemate.
• Download for FREE the Rentals for Newcomers Application Tips Guide.
• Work with a trusted settlement agency to help ensure your success.