Demand outpacing supply for seniors’ homes

The overall vacancy rate for seniors’ residences in British Columbia and Ontario trended lower in the past year.

CHMC has published its annual report on the seniors’ housing sector across Canada but focusing on the three provinces where seniors’ residences are most prominent: Quebec, Ontario and British Columbia.

The report considers both ‘standard’ homes where residents receive no more than 1.5 hours of care per day, also known as ‘independent living’; and ‘non-standard’ homes where residents receive additional care. This sector also includes respite and non-market homes.

Ontario vacancies at record low
In Ontario, the vacancy rate declined to a record low of 9.9% in 2018, down from 10.3% in 2017, despite supply increasing by 3,500 spaces, the most since 2001.

Average rent for a standard space was up 2.6% to $3,618.

"Even with the largest increase in supply this year, the vacancy rate trended lower as demand outpaced supply. The accelerating growth in the older population and the increasing acceptance of seniors' housing living, especially among seniors aged 85 and older, continued to drive demand for seniors housing," said Penny Wu, Senior Market Analyst, Ontario, CMHC.

British Columbia vacancy rate fell by a third
Tight supply also saw the vacancy rate fall sharply in British Columbia; from 4.5% in 2017 to just 3% in 2018.

There were just 340 new units added to the inventory.

"British Columbia's vacancy rate for independent living spaces for seniors declined again in 2018. A growing seniors' population continues to drive demand for seniors' housing. Price increases in the resale market over the past few years in many regions has supported some seniors' ability to move into independent and heavy care spaces,” by Keith Stewart, Senior Market Analyst, British Columbia, CMHC.

Quebec improves vacancies but with regional variations
The overall provincial vacancy rate for seniors improved in Quebec from 6.2% in 2017 to 6.9% in 2018.

However, the rate varies widely across the province. For example in the Montreal CMA, it’s just 2.9% in Laval but 10.5% in the downtown core.

"The rise of the provincial vacancy rate is mainly attributable to the changes in the Montréal and Québec CMAs, where we saw notable increases. Again, this year there are significant differences across the province with respect to either the state of the market, its direction, supply and the popularity of this type of housing," said Kevin Hughes, Regional Economist, Quebec, Canada Mortgage and Housing Corporation.


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