Winnipeg Free Press
November 26, 1999
Influx of 20- to 30-year-olds snapping up apartments.. CMHC
By Murray McNeill
STRONG EMPLOYMENT growth and an influx of people into the province helped push Winnipeg's apartment vacancy rate to its lowest level in 12 years.
Canada Mortgage and Housing Corp. reported yesterday the overall vacancy rate in Winnipeg rental properties with three or more units fell to three per cent in October from four per cent a year earlier.
It was the biggest drop of any major city, in Western Canada, and nearly a full percentage point greater than what CMHC officials were predicting at the start of the year.
In the suburban areas of the city, rental market conditions are even tighter, according to CMHC's latest annual rental market survey. While K@ the overall vacancy rate in the downtown is 5.1 per cent, the overall rate for the suburbs has plunged to its lowest level in more than a decade -1.4 per cent. The area with the lowest vacancy rate is Fort Garry, a measley 0.7 per cent, followed by St. James and Assiniboine Park at 1.2 per cent.
While those kinds of tight market conditions make it tougher for apartment seekers to find the suites they want, it makes life a whole lot easier for landlords and property managers like Bob Shaer, president of Ash Management Group Inc.
Shaer, president of the Professional Property Managers Association of Manitoba, said some of the suburban apartment blocks Ash manages now have waiting lists with up to 45 names.
"I would say the length (of our waiting lists) has doubled over the last three and a half years," Shaer added.
He and David Stansen, CMHC's senior market analyst for Manitoba, attributed the tightening rental market conditions to a variety of factors, including a buoyant economy and strong job creation over the last few years, an influx of new people to the province and few new rental units being built.
Stansen admitted CMHC officials were surprised at how far the overall vacancy rate has fallen in the last year.
"Obviously we underestimated the effects of the employment growth we've seen," he added.
Of particular significance was the employment growth among 20 to 30 year olds, many of whom are renters, Stansen added.
In 1998, for example, Statistics Canada figures show there were 143,000 new jobs created in Canada for people in that age group - the best job-creation performance for that group in two decades, he said.
In Manitoba, the job creation numbers for young people (15 to 24 year olds) weren't as significant - about 400 new jobs in 1998. A spokesman for Manitoba’s Bureau of Statistics said that may be due to the small sample size Statistics Canada uses for its Manitoba employment surveys.
Another contributing factor to the falling vacancy rate is the influx of new residents into the province in the last year or so, Stansen and the Bureau of Statistics official said.
In the first six months of this year, about 1,200 more people moved into the province than moved out. That reversed a decade-long trend of migration losses
Stansen, Shaer and Richard Moranz, president of Globe General Agencies, all said they expect vacancy rates to fall even further over the next year because the Manitoba economy should stay reasonably healthy,
The two property managers, Shaer and Moranz, said there likely won't be many new rental units coming onto the market as long as provincial rent control guidelines, remain in effect. "I've been saying for years that we're heading towards a rental crisis," Moranz added. "I think we'll be sitting here a year from now talking about a rental crisis and vacancy rates of less than one per cent in the suburbs."
The CMHC survey also showed that outside the Perimeter, apartments are easier to find than they were a year ago, although Brandon continues to have a lower vacancy rate than Winnipeg.
The vacancy rate in Thompson rose for the third straight year to 13 per cent, Portage la Prairie's vacancy rate rose to about five per cent, and Brandon's remains less than two p cent. The CMHC considers three per cent a good balance.
Brandon’s vacancy rate is expected to remain low because of steady employment growth and an increase in the number of people moving to the city. Average rents in Brandon are below those in Winnipeg, except for bachelor apartments.