Rental Rate Data

Recently I was at a breakfast meeting where a real estate agent provided a very detailed presentation of the recent housing sales. Their presentation had statistics identifying the number of sales, the average sale prices and the stats were separated by the type of property including single family homes, townhouses and condos. The information was great and very useful if you are wanting to understand the housing sales market. The reason they were able to provide a detailed presentation is the sales market updates stats monthly. 

The following week I was at another event and the topic of what are current rentals prices today came up. I described this report and said it is very difficult to determine what is the current market pricing due to the lack of efficiently collected data.   

I asked google gemini where CMHC obtained their rental housing data. It’s reply is below.

“Statistics Canada (StatCan) gets rental market data primarily from administrative sources like major online rental platforms (Rentals.ca, Zumper), complemented by Labour Force Survey (LFS) data for context, and partners with CMHC (Canada Mortgage and Housing Corporation), using their survey data for some reports. They combine these sources, clean the data (removing outliers), and use methods like linking to the Statistical Building Register to create reliable statistics on asking rents for apartments and rooms. “

The second question we asked was how often does statistics Canada update rental data. 

“Statistics Canada (StatCan) updates their key rental rate data, specifically the Quarterly Rent Statistics (asking rents from platforms) and other related indexes, on a quarterly basis, providing fresh insights into the Canadian rental market every three months. While some core housing data is released more frequently (like monthly GDP), the detailed rental figures, including breakdowns by unit size and area, come out quarterly for timely analysis. “

The response to these questions provide us with why the rental market is hard to determine what the current rental rate is

Let’s look at our second question first. CMHS updates rental rates quarterly not monthly. If data is only collected and updated each quarter we are often far behind on the current market conditions when the data is released. Rental rates can change rapidly especially in times of economic turmoil. It would be more effective if the data was updated monthly.

If we are reviewing data that is three months old to evaluate where we should price a rental property we are misleading our clients. 

With regards to the first question of where the data is obtained it is an imperfect system of collecting the data. CMHS indicates they use data from various rental platforms creating reliable statistics on asking prices. The problem with this model is that the asking price is not the rented price, especially in a volatile rental market. There are multiple rental websites that many landlords are not using creating a great discrepancy in the amount of data collected. Yes statistical analysis can make assumptions based on a sample size of the market, though in this case the amount of data missing creates a large discrepancy in the market.  

An example of this is the vacancy rate in Vancouver. Why are we able to obtain sales data on each city Vancouver, Burnaby, Port Moody, Coquitlam and Surrey for example. The rental data is not evaluated on every municipality and this can create a very misleading evaluation of a market when it is grouped with the neighbouring city which has a different market. The other concern is that the data collected fails to collect a significant amount of rental properties. These are the mom and pop often self managed individual rental properties where data is often missed. Working as a strata manager in Vancouver, CMHC would contact us to determine the number of rentals in a building and we didn’t even have the correct data as many owners were not identified as renting their unit. Although they were required to advise strata they were renting often they would not do this. Since 2010 the majority of condos built in the lower mainland of BC are rental properties. This leads us to believe that the estimated number of rental properties is significantly under estimated.   

How could this be improved? CHMC needs to report data more frequently, monthly reporting would be better. It would be great if CMHC could develop better data collection sources. Maybe the government needs to develop a system where landlords are required to register their data in order to file a claim with the BC RTB before a hearing. The information could include when the tenancy started and what the rental rates were. This would create a database of information that would be more accurate. It would be more accurate if the landlords were required to enter the data at the time of renting the property then the information would be upto date at the time the unit was rented.

Maybe one day there will be more effective and timely data to understand the current rental market rates.            

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