If you’re not familiar with purpose-built rentals, don’t worry— you’ll be hearing much more of them soon. The Canadian housing market is in an interesting crossroads right now, and almost every construction company is taking notice. Demand for rental units are high, supply is low, and experts are predicting that purpose-built rental units will play a bigger road in the Canadian real estate market in the coming years.
But what are purpose-built rentals? What makes them such an attractive prospect for people looking for a place to live in? Learn about this and more below.
The Perfect Storm
According to the Canada Mortgage and Housing Corporation (CHMC), purpose-built rentals are large, privately-initiated structures with multiple units in groups of three or more. These can be in row housing divisions or apartment housing. These units are built with the express intent of being rented long-term.
Today, homeownership for young adults, young couples, and growing families is far less attainable than it used to be. Compared to previous generations, buying a home has also ceased to be the holy grail of retirement. Indeed, one of the biggest trends to hit the real estate market is the increased preference for long-term rentals instead of purchasing a home outright. This has led to an unprecedented demand for rental housing across Canada.
At the same time, the supply of rental units far outweighs the skyrocketing demand. Listed units are snapped up in what seems like the blink of an eye. The CMHC has found that the general vacancy rate all around the country is at a bleak 3%.
Furthermore, current interest rates are low, prices are high, and investors are looking for new income streams. All these factors have converged to create ideal conditions for thriving purpose-built housing projects.
The Appeal of Purpose-Built Rentals
From all angles, the nation is experiencing a rental housing crisis. Purpose-built rentals offer a sustainable solution to this issue. Their benefits include:
Run by dedicated and responsible landlords, purpose-built rental housing offers an opportunity for consistent operations. Apartment units and row houses undergo strict standards of practice.
Before one can take up residence in an apartment unit, you should expect to be screened for suitability. This uniform process helps fosters a sense of community, security, and safety, among residents. Another element that makes rental housing such a great option is the 24-hour service and amenities that might not be available for homeowners.
Security of Tenure
Purpose-built rentals are meant for long-term leasing. Therefore, it removes the anxiety of a given unit being taken off the market at any given time. Should the complex be up for redevelopment, residents legally have various options to make sure they are not displaced unfairly.
For many people, renting makes more sense than buying a property. More and more people prefer leasing or renting long-term instead of being locked down to decades of mortgage payments. This means that purpose-built rentals are poised to be the hottest commodities in the world of real estate, offering a practical and meaningful way for millions of people to have a place to call home.