Vacancy rose nationally — finally, some breathing room
Canada's rental market finally gave renters some breathing room in 2025. After years of ultra-tight conditions, CMHC reports that vacancy rates rose across all major census metropolitan areas, and rent pressure eased in many markets as supply increased and demand cooled.
CMHC's national snapshot shows the average vacancy rate for purpose-built rental apartments climbed to 3.1% in 2025, up from 2.2% in 2024, and now sits above the 10-year average. In plain terms: you had more options, and landlords had to compete harder for tenants in many areas.
That doesn't mean affordability is suddenly fixed. It means the market is less 'winner takes all' than it was from 2022 to 2024, especially for certain unit types and neighbourhoods with lots of new completions.
Source: CMHC Rental Market Reports (Major Centres)
Why the market eased: more supply met softer demand
CMHC points to a clear supply-and-demand shift.
Rental supply expanded: Several years of strong rental construction delivered new units in 2024 and continued into 2025. More completions created more choice, particularly in cities with big development pipelines.
Demand cooled: CMHC notes weaker renter household formation and softer demand conditions tied to slower population growth, fewer international students in some markets, and a labour market that became harder for younger workers.
Lease-ups slowed: New buildings took longer to fill, and incentives became more common — think free rent months or move-in credits — as operators worked to stabilize occupancy.
One important takeaway here is that 'more units' helps, but the type of units matters. Many new deliveries are higher-end, which can increase competition at the top of the market first, then gradually create a filtering effect as households move up the quality ladder and leave vacancies behind.
The 'filtering effect': more movement, more options
CMHC also observed increased renter mobility in 2025. With more vacancies and fresh supply coming online, you were more likely to move to something that fit your lifestyle better — location, unit size, building amenities, and overall value.
This matters because mobility is a pressure valve. When you can move without massive rent shock, it reduces the sense of being stuck and helps the market function more normally.
Vacancy rose across all rent ranges (not just luxury units)
A notable point in the CMHC analysis is that the increase in vacancy rates wasn't limited to high-rent units. In 2025, vacancy increased across all rent ranges. CMHC even notes that for the first time in a decade, the least expensive units contributed to the increase in vacancy rates.
That said, 'least expensive' is relative. In many markets, entry-level rents are still high compared to incomes, and affordability remains a challenge even when vacancy improves.
National rent pressure eased, but not evenly
CMHC's report describes 'softened market conditions' and 'eased rent pressures' nationally. But the pattern varied by region and city. Some markets saw rent growth slow or flatten, while others still experienced sharp increases driven by local factors like rent guideline changes, supply constraints, or strong population inflows.
One of the most practical indicators CMHC provides is the average monthly turnover rent for a 2-bedroom purpose-built rental apartment in major census metropolitan areas. Turnover rent is what new tenants pay when a unit changes hands, and it often rises faster than rents for existing tenants.
Here are CMHC's 2025 turnover rent figures for 2-bedroom purpose-built rentals in selected major markets: Vancouver: $2,696. Toronto: $2,547. Montréal: $1,644. Ottawa: $2,155. Calgary: $1,836. Edmonton: $1,600. Halifax: $2,058.
CMHC notes that as turnover rents soften, landlords have less room to raise rents when a new tenant moves in, which can limit overall rent growth over time. This is one of the clearest ways the market 'cools' in the real world.
Condo rentals: vacancies rose, but stayed tighter than purpose-built
CMHC also tracks condominium apartments offered for rent (the secondary rental market). In 2025, condo rental vacancies increased too, but generally remained well below the purpose-built vacancy rate.
The report notes that condo owners were often more flexible on rents to avoid vacancies. In a softer market, smaller landlords may respond faster with price reductions, incentives, or upgraded terms to keep a unit occupied.
What this means if you're renting
If you're renting, 2025's shift is meaningful even if it doesn't feel like a full 'reset.'
More negotiating power: In markets with rising vacancy, you may see incentives, more responsive landlords, and a bit more time to choose the right place.
More choice in newer buildings: Some new projects take longer to lease, which can create short windows where promotions show up.
Be strategic about timing: If you're flexible, shop around and compare multiple buildings in the same neighbourhood. Competition is your friend.
Tip: If you're researching your city in detail, CMHC provides market-level downloads and data tables alongside the report. CMHC Rental Market Report Data Tables (Excel)
What this means if you own a rental property
For landlords, the story is about competition, retention, and realistic rent expectations.
Retention matters more: In a softer market, keeping a good tenant can be more valuable than pushing for top-of-market rent.
Incentives are back: CMHC highlights incentives in multiple markets, particularly where new supply is heavy. If your building competes with new product nearby, you may need a plan.
Unit positioning matters: Cleanliness, responsiveness, small upgrades, and clear lease terms can outperform a 'price only' approach.
Watch turnover rent trends: If turnover rent is moderating, your assumptions for future rent growth should be more conservative.
If you're buying a rental or refinancing one, this is also where lenders can get stricter about rental income assumptions in certain markets, especially where vacancy has jumped and lease-ups are slower.
What this means if you're planning to buy a home
A cooler rental market can influence your buying decision in a few ways.
Less 'rent panic' pressure: When you have more rental options, you may delay buying and wait for the right property or rate environment.
Investor math changes: If rent growth is moderating and vacancies rise, investors need to be more careful with cash flow assumptions.
Local conditions matter more than ever: National vacancy rising doesn't mean your neighbourhood is easing. Some pockets remain extremely tight.
The best approach is to treat the national overview as the macro weather report, then zoom into your city and neighbourhood for the decision-making details.
Bottom line
CMHC's 2025 national overview confirms a notable shift: vacancy is up, lease-ups are slower, and rent pressures have eased in many major markets as supply growth meets softer demand. For you as a renter, that can mean more choice and occasional incentives. If you own a rental property, it means competition, retention strategies, and more conservative forecasting.
To explore the full report and drill into specific markets, use CMHC's Rental Market Reports hub here: Rental Market Reports (Major Centres).
