Are rental prices going up or down?
As we look at the data for late 2025, the trend is clear: we are seeing a downward adjustment in major urban centers. After years of aggressive growth, the market is finally rebalancing. Across North America, we've seen a national average decrease of approximately 3% year-over-year.
Factors driving this shift include:
- Increased Supply: A record number of purpose-built rental completions.
- Economic Cooling: Slower population growth and shifting employment trends.
- Inventory Stability: Vacancy rates in cities like Vancouver and Toronto are hitting 3-year highs.
While the "asking rent" for new tenants is dropping, long-term tenants in rent-controlled units may still see their annual legal increases. However, the days of 15% annual spikes are currently behind us.
I'm definitely seeing more "one month free" incentives in Toronto lately. It feels like the power is shifting back to tenants slightly.
In the Midwest, prices are actually still holding steady or rising by 2-4%. It really depends on which region you are looking at!