Huge jump in Kelowna's vacancy rate boon for new tenants
Kelowna’s rental apartment vacancy rate saw a huge jump in 2024, especially when compared to Kamloops.
Kelowna's vacancy rate for went from 1.3 per cent in 2023 up to 3.8 per cent in 2024, according to the Canada Mortgage and Housing Corporation’s latest report.
Kelowna’s director of planning Ryan Smith previously told iNFOnews.ca the goal is to have a vacancy rate between three and five per cent.
“The Canada Mortgage and Housing Corporation’s purpose-built rental vacancy rate... would be a good indicator to say, over the last few years have we approved enough new rental housing? Has enough been built to start to push the vacancy rate up in Kelowna?” Smith said back in November.
Kamloops also had a vacancy rate of 1.3 per cent in 2023, but it only rose to 1.4 per cent in 2024.
Canada as a whole did not see as much improvement as Kelowna. The national vacancy rate rose from 1.5 per cent in 2023 to 2.2 per cent in 2024. This increase is a change for the better but it’s still far below the 10 year average of 2.7 per cent.
Kelowna has one of the highest vacancy rates in the country behind Calgary at 4.8 per cent, and Saint John at 4 per cent.
Kelowna’s housing starts outpaced Kamloops, even accounting for population differences. In the CMHC’s housing start data released in November it showed Kamloops had 334 housing starts compared to 3,719 housing starts in Kelowna.
“Record growth in rental supply helped slow down average rent growth and raise vacancy rates closer to the historic average, underscoring the critical role of added supply in improving housing affordability,” CMHC’s deputy chief economist Tania Bourassa-Ochoa said in a press release.
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The higher vacancy rate in Kelowna relative to Kamloops is correlated with lower rent increases when apartments turnover to new tenants.
For two-bedroom apartments in Kamloops that had tenant turnover the rent went up from $1,450 in 2023 to $1,934 in 2024.
“Affordability for Canadian renters remains a challenge, particularly for new tenants who faced significant rent hikes as units turned over, limiting mobility for existing tenants and making it harder for prospective tenants to enter the market,’’ Bourassa-Ochoa said.
For apartments that kept the same tenants the average rent decreased by $26 in Kamloops to $1,454.
The number of turnover apartments in Kelowna saw an increase in the past year but not nearly as dramatic as in Kamloops.
The average rent for two-bedroom apartments with tenant turnover in Kelowna was $2,073 in 2023, and $2,105 in 2024.
In Kelowna, apartments that kept the same tenants saw a larger average rent increase of $122 to $1,830.
The difference in the average rent between apartments that had turnover in Kelowna and in Kamloops is $171, compared to the $376 difference for apartments that kept the same tenants.
“Rents increased by 23.5 per cent when units turned over, which is close to 2023 rates. Rent hikes on turnover units accounted for more than 40 per cent of the overall rent increase,” CMHC said in the release.
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