According to a new report by Rentals.ca and Urbanation, average asking rents for all residential properties in September fell by 3.2 per cent compared to the same month last year, dropping to $2,123 per month.
The report marks a significant milestone as rents have declined year-over-year for the first time since January 2022, with prices now 1.2 per cent lower than they were in September 2023.
Shaun Hildebrand, president of Urbanation, highlighted the improving conditions for Canadian renters.
“Renters in many parts of Canada are experiencing the best levels of affordability in two years, with the most expensive markets in Vancouver and Toronto seeing rents at their lowest in nearly four years,” he said.
This recent decline follows a prolonged period of rental increases, with the market previously experiencing 38 consecutive months of rent growth between August 2021 and September 2024.
The report attributes the falling rents to several factors, including record-high apartment completions, decreases in non-permanent resident populations, and a weakening job market.
Different property types have experienced varying degrees of price reduction.
Purpose-built rentals saw a 2.1 per cent decrease with average rents at $2,093 compared to September 2024, while the average condo experienced a three per cent reduction to $2,226.
Houses and townhouses recorded the most significant decrease, with average rents dropping 5.5 per cent to $2,178.
One-bedroom homes saw rents fall by 4.1 per cent to an average of $1,836, while two-bedroom units decreased by 2.6 per cent to $2,220.
Canada’s population growth has also slowed dramatically, with the country adding an estimated 47,098 people in the third quarter of 2025, representing the second slowest quarter since physical restrictions limited growth in 2021.
Vancouver, despite maintaining its position as the country’s most expensive rental market, experienced the steepest decline with rents falling 8.2 per cent compared to September last year.
Toronto, the second most expensive market with average rents at $2,592 across all property types, saw a decrease of 2.9 per cent.
The rental market’s cooling trend represents a significant shift after years of escalating housing costs that have challenged affordability across the country.
“Eventually housing demand and supply will converge, driven by slowing population growth and increased residential construction activity,” Mr Hildebrand said.
“This current trend provides much-needed relief for renters who have faced persistent affordability challenges over the past several years.”
