Rising rental rates and diminishing options are causing some with lower income to forgo housing altogether, a Saskatoon community organization says.
According to the most recent Canada Mortgage and Housing Corporation (CMHC) rental report, Saskatoon’s rental vacancy rate was at its lowest since 2014.
“The vacancy rate for purpose-built rental units continued a years-long decline, falling to 3.4 per cent. Rents grew by 3.6 per cent after being flat last year,” the CMHC Rental Market Report said.
There were several reasons for the increase, according to the CMHC, including an improvement in employment conditions and a growing population rate thanks to immigration.
The report also noted that the number of rentals in the city grew quicker than at any point in the last three decades.
“There were 801 units added— nearly 40 per cent higher than the amount added last year. More than half of these units were added in the coveted northeast,” the report said.
Saskatoon’s northeast saw the lowest vacancy rate at 1.3 per cent and the highest average rent at $1,250. However, more rental units aren’t leading to more options, according to the CMHC.
“Rental market demand continues to outstrip new supply, with the increase in occupied units exceeding the increase in new rental units,” the report said.
They also noted that the number of renters is not likely to drop soon.
“The increasing ownership is decreasing the incentive for renters to transition to homeownership. This means more demand will remain in the rental market.”
And it also means higher rents, as the CMHC notes that rents jumped an average of $150 between a tenant moving out and a new one moving in.
CMHC said that rental affordability challenges were the worst for lower-income families.
“Households in the lowest income quintile could only afford 7 per cent of properties in the rental universe,” the report said.
It’s a problem that the executive director of the Community Legal Assistance Services For Saskatoon Inner City Inc (CLASSIC) said was leading to an increase in homelessness.
Chantelle Johnson said that most people living with lower incomes were relying on government assistance that offers $315 for living expenses and $575 for housing, which includes utilities.
However, most one-bedroom or bachelor suites in the city start at $700 according to the organization’s research.
She said she has been with the CLASSIC for 11 years and says the last year or so is the worst she has seen.
“We have people who camp out in our parking lot. We have people who sleep all in our back alley behind where we work,” Johnson said.
She said those at other community-based organizations are seeing the same crisis.
“It’s apparently visible in the community that there is far more houselessness than lots of us have ever witnessed in Saskatoon before.”
Johnson said in order to fix the problem, there is a need for more affordable housing units and an increase in the fixed income rate.
“Like all of us right now our clients are experiencing even more pressure points because of the cost of things such as groceries. When a bucket of eggs is $6 and you have $315 for the entire month for all your groceries, clothing and Tylenol, feminine hygiene products, you burn through that pretty quickly.”