The multifamily landscape is experiencing a dramatic shift. Here’s what’s happening right now:
New buildings are struggling. Purpose-built rentals completed post-2020 are facing vacancy rates approaching 10% in major markets, while older, affordable units remain near full occupancy. The disconnect? New luxury units are pricing themselves out of reach just as economic headwinds intensify.
The numbers tell the story:
- National vacancy hit 4.1% in Q2 2025 – the highest in 5 years
- Calgary leads at 6.7% vacancy, with Toronto at 4.2%
- Over 24,987 new rental units were completed nationally in the past year
- Yet rent growth is now lagging inflation across most markets
The paradox? We’re simultaneously experiencing a housing shortage AND rising vacancies. The issue isn’t lack of supply – it’s affordability misalignment. As Canada navigates tariff uncertainty, slowing immigration, and a potential recession, the rental market faces a rare rebalancing moment.
Bottom line: The “build at any price” era is over. Success now depends on understanding income constraints, targeting the “missing middle,” and recognizing that today’s market rewards affordability over amenities.
What are you seeing in your local markets?
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