A new report finds that Victoria's rental vacancy rate has risen above the one per cent mark for the first time in four years as supply outstrips demand.
The Canadian Mortgage and Housing Society's annual survey said that Victoria's vacancy rate has hit 1.2 per cent thanks to an expansion of purpose-built rental properties in the city.
A year ago, the vacancy rate hovered around the 0.7 per cent mark. The CMHC report credits the increase to Victoria adding 682 primary market rentals since last year.
Victoria was also among the B.C. cities with the largest increases in average rent.
At $1,170, average rent for all bedroom types in B.C.'s capital increased by 7.5 per cent year-over-year.
The only cities with a higher average rent in B.C. were Vancouver at $1,385 and Squamish at $1,186.
The report found that average rents for a one-bedroom private apartment rose from $988 in October 2017 to $1,076 this year. Average rent for a two-bedroom apartment rose from $1,288 to $1,406.
Supply of private apartments surpassed the 25,000 mark last month, increasing faster than demand in the market and also helping to raise Victoria's vacancy rate for the foreseeable future.
"On a provincial level, rental housing starts have been persistently strong since 2016 with the largest number of rental starts seen in the Vancouver, Victoria and Kelowna CMAs," the report said. "The majority of these projects are apartment rental structures which take longer to complete and so these new additions will continue to add significantly to the rental supply through 2019 and 2020."
The overall vacancy rate in B.C. rose slightly to 1.4 per cent, versus 1.3 per cent for the same period last year, while the province's average rent hit $1,248.
Read the full CMHC report here.
