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Estevan's vacancy rate soars

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Estevan's vacancy rate has risen significantly in a 12-month span, according to the Canada Mortgage and Housing Corporation’s (CMHC) April 2014 Rental Market survey, which was released on June 11.

The report says that 5.5 per cent of reported rental properties were vacant, the highest rate for Estevan in years. It's also above the provincial average of 3.3 per cent.

There weren't any available units in Estevan in April of 2013.

"The addition of newly constructed rental apartments and work camps alleviated some of the rental pressures which were previously being experienced in this centre," the CMHC report states.

The vacancy rate is 4.9 per cent for one-bedroom apartments and 5.6 per cent for two bedrooms, CMHC said. Figures were not available for bachelor suites or three-bedroom properties.

There are 545 reported rental properties in Estevan in April, compared to 511 a year earlier. Twenty-four of the new properties are two-bedroom apartments.

Lloydminster is now home to the lowest vacancy rate in Saskatchewan at 1.8 per cent. Regina is next at 2.5 per cent.

But Estevan still has the highest rental rates in the province, as it stands at $1,170 per month, compared with $1,068 per month in April of 2013. A two-bedroom apartment in Estevan will cost $1,275 per month, compared with $1,143 a year earlier.

"The increase in oil and gas production contributed to the lowest rental vacancies in the province last year, fuelling the demand for additional rental housing in these centres," the report states.

"Builders in Estevan and Lloydminster have responded with the addition of new rental units to the universe, which garner higher than average rent levels."

Bachelor suites in Estevan went from $722 a month to $749; one-bedroom apartments jumped from $1,046 to $1,143, and three-bedroom sites dropped from $1,283 to $1,240.

The overall apartment vacancy rate in Saskatchewan’s urban centres increased from three per cent in April 2013 to 3.3 per cent, as most centres reported higher vacancies.

"A slowdown in net migration was a key contributor to the higher rental vacancy rate in the province," the report states. "Total net migration to Saskatchewan moderated in 2013, as improving economic prospects outside of the province, particularly in Alberta, impacted the number of new arrivals.

Industry consultations also indicate that low mortgage rates and continued rent increases have motivated some households to move from rentals to homeownership, further contributing to the rise in vacancies.

On the supply side, homebuilders in Saskatchewan initiated 1,308 apartment rental units in 2013, a nearly 60 per cent increase from the rental starts in 2012, which also contributed to the slightly higher vacancy rate.

 


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