Prices are now 7% below 2024 levels and at their lowest point since 2022
Canada's trade conflict with the United States is widening a split in the national rental market, with communities most exposed to US tariffs recording steeper rent declines than their counterparts, according to new research.
Average asking rents fell 4.8% year-over-year in August to $2,035, the steepest annual drop since March and the 23rd consecutive month of decline, Rentals.ca and Urbanation found in a report.
Prices are now 7% below 2024 levels and at their lowest point since 2022.
Read more: Canada's rent relief isn't reaching those who need it most
Across tariff-exposed communities
Using exposure data from the Canadian Chamber of Commerce, the report identifies Calgary, Windsor, Kitchener-Cambridge-Waterloo, Brantford, Guelph, Hamilton, Trois-Rivières, Lethbridge, Thunder Bay, and Oshawa as the 10 cities most vulnerable to the trade conflict through their auto, steel, aluminum, energy, and lumber sectors.
Oshawa registered the sharpest rent decline nationally at 10.8% year-over-year.
Windsor, despite its significant automotive exposure, saw a comparatively modest 2.4% drop. That's a softer outcome the report attributes to a thinner rental supply base.
Read more: National rents fall again, offering relief for potential first-time buyers
The 10 least-exposed cities — including Vancouver, Halifax, Saskatoon, and Winnipeg — have recorded comparatively steadier conditions.
"While there has already been an observable correlation between rents and tariff exposure, with rents in the 10 most tariff-exposed CMAs falling faster than the 10 least-exposed, as of August 2026, local market effects have remained the dominant factor," the report states.
Bank of Canada governor Tiff Macklem issued a stark warning Monday that a fresh round of US tariffs and elevated global oil prices risk undoing Canada's hard-won economic recovery.https://t.co/k19n8NXNPd
— Canadian Mortgage Professional Magazine (@CMPmagazine) September 22, 2026
Building costs and supply risks compound the pressure
The trade conflict is also squeezing construction economics. According to Statistics Canada's Building Construction Price Index, fabricated metal costs rose 2.1% quarter-over-quarter, while structural steel climbed 1.8% over the same period and 7.2% since the first quarter of 2025.
That's a direct consequence of the United States' 50% tariff on Canadian steel, which Canada matched in full with retaliatory levies.
Toronto and Vancouver face a compounding exposure. Condo starts have declined in both cities while construction remains reliant on steel and rebar now priced significantly higher.
"With little to no condo construction to fall back on, Toronto and Vancouver are doubly exposed to potential price shocks on the supply side," the report warns.
Analysts tracking how Canada's rental market cooling is masking a deeper supply risk heading into 2028 have flagged these conditions as a mounting concern for lenders and developers.
The jobs toll is considerable. Statistics Canada data shows Ontario lost 27,200 manufacturing jobs, with primary metals employment in the province down 18.4% in a single year. Nationally, 40,600 manufacturing positions were shed in 2025 due to tariff-related disruption.
Trade uncertainty is simultaneously nudging tenants in affected markets to stay in place rather than move, a pattern that is pushing landlords to offer deeper concessions on new leases than on renewals.
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