Rental vacancy rate in Windsor at a record low

A rendering of a new apartment building on Gibbons Street in Goderich (Provided by Hannah Moore, Communications Specialist, Administration, County of Huron)

The vacancy rate in Windsor hit a record low in 2022 and the average rent amount was up 3.9 per cent.

The Canadian Mortgage and Housing Corporation Rental Market Report indicated the rental vacancy rate in the region is at 1.8 per cent. At its peak in 2008, the vacancy rate in Windsor was 14.5 per cent.

“What we are seeing is an increasingly tighter rental market. If we put that number in perspective we are seeing that the demand for units significantly outweighs the supply of units,” said Senior Analyst Tad Mangwengwende.

The low vacancy rates also leads to further affordability concerns. While the rent cost of an average two-bedroom unit increased to $1,197 a month, the CMHA found the rent for vacant units was significantly higher than units that were already occupied.

“If a vacant unit is costing 20 per cent more than an occupied unit that can only happen when demand significantly outstrips supply,” said Mangwengwende.

The low supply can also lead to bidding wars for rental units.

“Now that we add the layer of bidding wars it means that there is nothing preventing someone in a higher-income bracket from coming and pulling a unit out of someone’s affordability range by bidding on it,” said Mangwengwende. “There is a tight market for lower income households and it is even tighter because bidding wars mean that whatever is available is also pretty hard to get to.”

The current housing market in Windsor is a big factor in the low rental supply. As home ownership becomes less attainable, less people are moving from rental units.

“When people stay put then those units are effectively being taken out of the market. So one might say there is still that demand in the market or the supply that would have been on board has not come on board because people have remained in those units,” said Mangwengwende.

He indicated the demand in the Windsor region is only expected to grow as new employment opportunities like at the NextStar Energy plant become available