Report: University Area Rents Decline Rapidly as Foreign Student Caps Take Effect
Canada’s federal government has implemented a cap on international students, significantly impacting the rental market for students across the country. According to a recent report by Rentals.ca, this cap has led to a rapid decrease in rents, particularly in areas with high student populations.
Impact of International Student Caps on Rentals
Since the introduction of the international student cap last year, cities renowned for their educational institutions have experienced notable rent declines. This change follows a period when the international student population nearly doubled from 2020 to 2023, resulting in unprecedented demand for rental units.
Declines in Major Provinces
Ontario and British Columbia have seen the most significant decreases in rental prices. The average rent in Ontario fell by 5.8%. Specific cities reported even sharper declines:
- Toronto: 8.1% drop
- Kitchener-Waterloo: 6.8% drop
- London: 6.6% drop
British Columbia reported an average decline of 5.4%, with major cities showing notable reductions:
- Vancouver: 8.3% drop
- Victoria: 8% drop
- Burnaby: 11.5% drop
Local Trends Near Universities
The report highlights that the decline in rental prices is concentrated around universities and colleges. For example, near McGill University in Montreal, one-bedroom rents decreased by 4.4%, while the overall city decline was only 1.3%. Similarly, Dalhousie University in Halifax saw rental prices fall by 9.9%, compared to an 8.7% decline citywide.
Broader Market Trends
Giacomo Ladas, a spokesperson for Rentals.ca, commented on the trend: “With fewer international students entering the country, we are witnessing a real correction in post-secondary housing markets.” He noted that student renters now have an abundance of more affordable listings and face less competition.
Additionally, a recent TD Bank report indicates that the slowing population growth is alleviating pressure on the housing market. This shift is contributing to a more balanced rental market across Canada.
In September, average asking rents for all residential properties in Canada dropped by 3.2% compared to the previous year, reaching an average of $2,123 per month. This marks the 12th consecutive month of rent declines and the first two-year decline since January 2022.
