The record growth run Canadian property investors have enjoyed with rental income has been slowing in the past 12 months, but there’s every reason to be optimistic for 2025, according to industry experts.
To the end of December, the 12-month rise in rents stood at +3.2%, or +$2,109pa. That’s the slowest rate of rental price growth for 17 months.
For investors, this indicates the importance of keeping your tenants, as finding new ones may not be as easy as it has been for the past three years.
Property managers and agents are reporting that some landlords are having to incentivise tenants to sign a lease. On the other side of the deal, tenants are enjoying a wider choice of properties.
As an investor or landlord, it’s worth looking back on the incredible period of rental growth across Canada.
Prices rose 4.6% in 2021, then surged 12.1% in 2022 before falling back a little to 8.6% the following year. In anyone’s language, that’s a fantastic return, and it doesn’t include the boom in post-Covid property values.
So, why is the rental market slowing?
It comes down to the current economic challenges Canada faces, which is creating a degree of anxiety about job security. The constant chatter about tariffs is not helping.
A consequence of these factors is that many folks are deciding to not move to a new property just yet, while younger ones are trying to stay with their parents longer.
The biggest sin for any landlord is for a rental to be vacant, sucking up cash and not bringing in any income. So, here are five tips to make your rental as attractive as possible when the time comes to find new tenants.
High-Quality Visuals: First impressions are everything. Invest in photography and a video walkthrough. It’s a good idea to use a professional photographer with real estate experience. You can probably get away with a DIY effort, but if you do, remember to ensure the property is well-lit. Our advice is to use a property management company.
Competitive Pricing: This sounds obvious, but you need to research comparable properties in your area to determine a competitive rental rate. Overpricing can lead to extended vacancies. A real estate agent or property manager has the best handle on this. Trust their guidance. Also, be transparent about all fees and charges with prospective tenants.
Highlight Features: List all the property’s attractive features, such as updated appliances, in-unit laundry, parking or outdoor space. And don’t forget to mention the property’s proximity to amenities like public transportation, schools and shops.
First Impression: Presentation and maintenance is key. Ensure the property is clean when potential tenants conduct an inspection. It should be ready for them to move into.
Timely Communication: Respond quickly to inquiries from potential tenants and always be professional and courteous. This way, you’ll build trust. Or, if you’re using an agency property manager, come back to them as quickly as possible if they need a decision from you.