City Reports Increased Vacancies and Rental Prices in 2020

January 28, 2021
 

Kingston’s vacancy rate has improved for the second year in a row – increasing from a record-low 0.6 per cent in 2018 to 1.9 per cent in 2019 and again this past year. The increase to 3.2 per cent at the end of 2020, as reported today by the Canadian Mortgage and Housing Corporation (CMHC), reflects an increasing housing supply. However, current high rental and housing costs mean that the City must continue its work to support more new housing going forward to sustain this progress.

“Increasing housing affordability is a top priority for City Council,” says Mayor Paterson. “We've introduced a number of innovative policies and last year we saw a record amount of new housing construction. I'm very pleased to see a 3.2 per cent vacancy rate, and I think this confirms we are headed in the right direction. However, the demand for housing remains high in Kingston, so there is still more work to do to maintain a healthy vacancy rate in the long-term.”

What This Means

Kingston’s current vacancy rate reflects the percentage of purpose-built rental housing units available in our housing market at a point in time. A vacancy rate of 3 per cent is considered healthy. Over the past 10 years, Kingston’s vacancy rate has averaged 1.7 per cent. Kingston’s reported 3.2 per cent vacancy rate is consistent with the provincial average which was also reported to be 3.2 per cent.

Highlight commentary from the 2020 Rental Market Report for the Kingston Census Metropolitan Area includes:

  • The average rent for a one-bedroom unit increased to $1,145 in 2020, up from $1,101 in 2019.
  • The overall average rent paid by tenants increased by 3.1 per cent in 2020, which was less than the 7.9 per cent average rent increase experienced in 2019.
  • The increase in the supply of rental housing in the community helped put upward pressure on the vacancy rate.
  • The increase in the vacancy rate to 3.2 per cent is not expected to be a result of fewer students returning to Kingston related to the COVID-19 pandemic as most students signed leases before the full impacts of the pandemic were experienced in 2020.

It is important to note that only multi-residential buildings with three or more units are counted in CMHC’s primary vacancy rate calculations so that certain rented dwellings, considered part of a secondary rental market, do not figure into the vacancy rate. The secondary rental market includes dwellings such as duplexes, houses, condos, one or two apartments attached to commercial space and secondary suites (117 permits were issued for secondary suites in 2020).

“We value our partnership with the development community and our continued collaboration in providing housing opportunities for Kingston,” says CAO Lanie Hurdle. “This increase is also a result of the hard work of City staff who have facilitated the record number of housing starts we’ve experienced over the last few years.”
 

Increasing Momentum

 

New rental building projects under construction

The City issued building permits for 1,407 residential units in 2020, up from 1,061 in 2019. This number reflects all housing types, with 875 of the permits being issued for multiple-unit dwellings. Many of these are expected to be completed in 2021 so that, starting in late 2021 and into 2022, there will be a greater number of new units to further increase the rental market supply.

Housing initiatives to increase overall housing supply

The Mayor’s Task Force on Housing presented a report to Council last March that contained a set of recommendations to increase housing supply. Although some of these recommendations included secondary rental market units, the implementation of the overall recommendations is influencing the development of housing units.

2020 marked the midpoint of the City’s 10-Year Municipal Housing and Homelessness Plan, which has been updated to reflect Kingston’s current housing context and challenges. The updated plan includes a series of actions intended to increase housing supply and provide housing and support services to the community’s most vulnerable members. 

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  • Dinah Jansen
    published this page in News 2021-01-28 16:10:50 -0500