Not long ago, Estevan was home to one of the hottest rental property markets in the country.
The rental vacancy rate often hovered at or around zero, and the cost for rent each month was among the highest in Canada.
But that trend has reversed in recent years, thanks to new rental properties that were constructed in 2013 and 2014, an influx of condominium properties for purchase in the city, and the economic slowdown that stemmed from a lower price of oil.
The Canada Mortgage and Housing Corporation (CMHC) released its annual rental market outlook on Monday morning, and it showed that Estevan’s vacancy rate was at 27.6 per cent in October, up from 20.8 per cent a year earlier. It was the highest vacancy rate in the province among 10 cities ranked by CMHC.
Lloydminster (25.4 per cent) and Weyburn (20.2 per cent) were second and third, respectively.
“The economic base for all three centres relies on the energy sector,” CMHC stated in its report. “With energy prices remaining supressed, economic activity has been curtailed sharply, leading to a significant reduction in rental demand.”
The average vacancy rate for Saskatchewan was 9.4 per cent, compared with 6.8 per cent a year earlier.
Estevan’s average rent also dropped, from $1,036 in 2015 to $898 this year. It’s now the fourth-highest rate in the province, behind Regina ($1,023 per month), Saskatoon ($1,019 per month) and Lloydminster ($999 per month), but Estevan’s average rent is now below the provincial average of $980 per month.
According to CMHC, bachelor suites in Estevan saw a decrease in vacancy rates, from 32 to 25 per cent, while 21.6 per cent of one-bedroom units were vacant, compared with 27.3 per cent a year earlier.
But the vacancy rates for two-bedroom apartments jumped from 17.2 to 30.5 per cent, and three-bedroom units soared from 12.5 to 32.3 per cent.
The average rent rates dropped in all four categories of properties. For bachelor suites, it went from $532 to $507 per month. One-bedroom apartments decreased from $778 to $723 each month. Two-bedroom apartments saw the biggest decrease, going from $1,209 to $1,001 each month.
Three-bedroom apartments declined from $1,204 to $1,131 a month.
CMHC reported there are 573 total rental units in Estevan, down by eight from 581 a year earlier. The decrease can be attributed to the number of bachelor suites, which dropped from 25 to 16.
One-bedroom apartments diminished from 187 to 185, and three-bedroom apartments dropped by one from 32 to 31. The number of two-bedroom units was up from 337 to 341.
CMHC collected information on the tenant turnover for the first time in the fall 2016 survey. The turnover rate for the province was 36.4 per cent, which was slightly higher than Estevan’s rate of 35.3 per cent.
Bachelor suites in Estevan experienced a turnover rate of 93.8 per cent, one-bedroom apartments were at 43.2 per cent, two-bedroom units were at 28.2 per cent and three-bedroom dwellings were at 35.5 per cent.
