ATB: Average Alberta Rent Up 26% Since 2002

The following is from ATB’s Daily Economic Comment dated April 4, 2013

Paying  The Rent

For many Albertans renting an apartment or house is the primary shelter cost they pay each month. And while it seems like rents keep getting pushed up, the rising cost has not been out of line with general inflation.

In January of this year, the price index for rented accommodation in Alberta was 125.6, with the index based on setting prices in the year 2002 equal to 100. That means rents in our province, on average, are about 26 per cent more than they were in 2002. In the same month, however, the all-items consumer price index was 126.5. That suggests overall inflation has actually outpaced the price of rented accommodation since 2002.

This may come as a surprise to many Albertans who have witnessed their rents rising steeply over the same period. And indeed, because it is an average across the province, it’s not fair to say everyone’s rent has risen by only 25 per cent. Certain cities—especially those with fast growing populations—have seen apartment rents skyrocket.

During the boom years of 2007 and early 2008, the prices of rented accommodation rose sharply (see graph). That was due to the hot economy, a lot of inmigration and a great deal of apartment conversions to condominiums (which reduced the available supply of rental units). Rents actually came down a bit in 2009 and 2010, but resumed a steady increase last year.

Source: ATB

Source: ATB

6 responses to “ATB: Average Alberta Rent Up 26% Since 2002

  1. Rents are supported by cash, not credit and as such change in rent is a better reflection of where monthly costs should be, based on wages.

    I think we have a long way down without easy credit – not sure people quite understand that.

  2. I have been renting since 2000, wish i would of bought years ago I waited and got priced out forever . But at the end of the day I am thankful some times because I do not have to do anything , it falls on someone else shoulders when things break . I know it is expensive my wife and I pay 1500 a month . which makes it hard to save money for a down payment to buy , so we are a lifer on renting .

  3. I agree rent is all cash , so can only rise to what people can afford if it goes to high , and economy slows down then it adjust

  4. Mike a bit off topic , just wondering as always where the market is going . I know listings are down sales are up from the stats . However I wondering if the slow down in BC and out east is working its way to Alberta . I know no one has a easy answer, but I get the feeling of late the winds are blowing are way , I ve had two friends get laid off in the last couple weeks and also heard some things up north are wrapping up . Just wondering as always
    jerry

  5. Hello Jerry,

    Your anecdote is reflected in the job numbers released yesterday:

    Canada experienced the worst jobs performance in almost four years last month as 54,500 workers joined the ranks of the unemployed, all full time and all in the important private sector.

    Even Alberta, one of the country’s strongest performers, lost 11,300 jobs in March, raising the unemployment level here to 4.8 per cent, up from 4.5 in March.

    “It doesn’t get much uglier than this,” Bank of Montreal chief economist Douglas Porter said in a commentary.

    Read entire article

    For Calgary specifically, the unemployment rate went up slightly: 5.1% in March, compared to 5.0% in February.

  6. Interesting , usually my company hires summer students but this year we had been told it is being cut by 50% , no layoffs but they are adjusting budgets and there seems to be a bit of hurry to shore up expenses of late. I think we are seeing the start of a slow down , not a crash but a slower cautious approach .
    Some of the cancelled projects up north are to blame

    just my two cents

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