The summer rent recovery has stalled, and Urbanation says the tariff conflict is the next threat
Canadian asking rents fell for the 23rd consecutive month in August, with the national average dropping to $2,035. That's down 4.8% year-over-year and the steepest annual decline since March, according to the Rentals.ca and Urbanation National Rent Report.
The result reverses the momentum of four consecutive monthly gains and leaves asking prices at their lowest point since 2022, now 7% below year-ago levels.
Month-over-month, the August figure slipped just 0.1% from July, effectively ending the summer sequential gains that had built since Canadian rents hit a 35-month low in March. The seasonal lift has now dissipated.
"The seasonal tailwind that lifted rents through the spring and summer has faded," said Shaun Hildebrand, president of Urbanation.
Hildebrand also flagged the Canada-US trade dispute as a new source of uncertainty, warning that weaker employment and declining consumer confidence could slow rental demand in the near term, while tariff-linked cost increases risk constricting new construction supply.
Toronto leads tentative shift
The July data, published by Rentals.ca and Urbanation, showed the market in more encouraging shape.
The national average that month was $2,037, down 4.0% year-over-year. That's the smallest annual decline since February 2026, and up 0.2% from June, extending what had been a four-month run of sequential gains.
Among Canada's six largest markets, Toronto stood out.
Apartment and condo rents rose 1.6% from June to $2,577, with the annual decline narrowing to just 0.6%, the best performance of any major city tracked.
Three-bedroom rents climbed 3.9% year-over-year to $3,655 as supply tightened, with Toronto listings down roughly 6% from a year earlier.
That strength had not yet spread outward. Rents in surrounding markets — Brampton, Mississauga, Oakville and Oshawa — continued to post annual declines of more than 7% across all property types in July, a sharp contrast to conditions within the city.
By August, Toronto asking rents averaged $2,571, down 1.8% annually, according to Rentals.ca and Urbanation, a step back from July's relative outperformance.
Purpose-built resilience and provincial divergence
By property type, purpose-built rental apartments remained the most resilient segment. August asking rents for purpose-built units fell 3.3% year-over-year to $2,038, compared with a steeper 7.7% annual decline in condominium apartments, which averaged $2,050.
Brokers advising clients with investment property exposure will note that Canada's national vacancy rate dipped for the first time in nine quarters in Q2, a signal that the multi-year wave of purpose-built supply additions may be moderating.
Provincially, Nova Scotia held its position as the country's most expensive market for apartment and condo rents in July at $2,377, up 4.5% year-over-year and ahead of British Columbia for a third consecutive month, driven in part by a higher concentration of larger units and newly completed buildings undergoing lease-up.
Ontario posted the strongest provincial monthly gain in July at 0.8%, while Saskatchewan and Manitoba, which had led provincial rent growth for much of the past year, both eased month-over-month, a possible sign that interprovincial migration flows into those markets are beginning to stabilise as affordability improves elsewhere.
As rents sank to their lowest June level in four years last month, RBC Economics had cautioned that the correction's duration would depend heavily on how quickly immigration policy normalises and population growth recovers. That outlook now carries an additional variable: the unresolved trade dispute south of the border.
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