Rentsync National Rental Demand Report: March 2025

Demand Trends for the Canadian Market

February typically marks a cooling period in rental demand after the January surge, but this year, the slowdown was steeper than usual. Some markets saw a sharper-than-expected drop, while others (where demand growth usually holds steady) experienced a levelling off.

Nationally, the number of unique rental prospects declined -9.6%, but the supply of available properties also shrank -2.5%. This suggests that while fewer renters were actively searching, part of the dip came from completed lease agreements, with properties coming off the market as renters secured their homes.

Winter Weather Likely Played a Role

Expectations for rental demand haven’t quite matched reality, but this isn’t necessarily a sign of trouble ahead. One major factor behind February’s decline was the harsh winter storms that swept across many Canadian cities, especially parts of Southern Ontario and Quebec. Many households were more focused on digging themselves out than finding new digs.

Breaking Down the Numbers

• Nationally, active rental prospects dropped -9.6%, while available listings declined -2.5%. This decline was steeper than the five-year average of -6.1% for February.
• The top 40 markets saw a slightly worse decline, with active prospects falling -10.4%, while the top 10 markets saw a -10.2% drop.
• Primary markets (major cities) experienced the smallest decrease in demand at -7.3%.
• Tertiary markets (smaller regions) were hit hardest, with a -19.9% decline in prospects and the largest drop in available listings at -6.0%. This suggests that while demand fell, there was also greater leasing activity in these areas.
  

What to Expect Next

As rental demand rebounds, we expect primary markets to recover first, followed by secondary markets, which benefit from strong job opportunities and commuter access. Tertiary markets—which tend to be less connected—may take longer to see a full recovery.

While February’s numbers reflect a seasonal dip, market fundamentals remain strong, and we anticipate renewed activity as conditions improve.

In the following sections, we identify notable changes in rental demand, highlight market-specific trends, and discuss what the coming months may look like for the rental demand in Canada.

Top Canadian Cities in Demand

Notable Changes in Demand Over the Past Month

Demand scores declined in February by -8.5%, losing much of the gains from the February increase, however remaining +4.6% up over the prior 3 months. Across our top 40 markets, demand scores declined by -8.5% monthly, prospect counts declined by -10.4%, and active properties declined by -2.0% while average prospects per property declined by -8.5% monthly. The top 10 markets saw a greater relative decline in demand scores -11.1% due to the growth in active properties +1.1%, while unique prospects declined -10.2%. 

Month-Over-Month (M/M)

• Primary: Demand scores are down -5.2%
• Secondary: Demand scores are down -16.0%
• Tertiary: Demand scores are down -14.8%

Month-over-month (M/M): Within our top markets, demand scores were down -8.5% in February 2025 compared with January 2025. This decline in rental demand is typical of February rental demand trends, which sees a decline after the January rebound.

Notable Changes in Demand Over the Past Year

Annual demand comparisons show that while rental demand is moderating, the above-average decline of monthly rental demand resulted in a larger year-over-year decline in February than that of January. Across our top 40 markets in rental demand, active prospects declined -33.8% year-over-year, active properties declined -3.4%, and active prospects per property declined -31.4%. Across the top 10 markets annual prospect counts are down -28.6%, properties -5.9%, and average prospects per property -24.1%. 

Year-Over-Year (Y/Y)

• Primary: Demand scores are down -1.7%
• Secondary: Demand scores are down -24.3%
• Tertiary: Demand scores are down -0.8%

Year-over-year (Y/Y): Within our top 40 markets demand scores are down -5.6% in February 2025 compared with February 2024. Active prospects are down -33.8% year-over-year, while properties are down -3.4%.

An Analysis of Key Canadian Markets

To provide a more detailed analysis of the rental demand in specific markets across Canada, we have segmented our market data into 3 key market segments.

• Primary (Populations Over 600K)
• Secondary (Populations Between 235-600K)
• Tertiary (Populations Between 100-235)

Examining these market segments individually offers a deeper understanding of demand patterns within larger population centres, and allows us to identify trends across markets. 

Primary Markets (Populations >600k)

Primary Market Drill Down (M/M): October 2024 vs. September 2024

Notable Changes in Primary Markets Over The Past Month

Overall demand scores are down -5.2% month-over-month, unique prospects are down -7.3%, and properties are down -2.2%.

Primary markets saw the lowest relative monthly declines in active prospects of all market segments. While the market expected rental demand to continue the steady rebound, which began in January and was the culmination of 6 months of gradual moderation, instead February saw a tightening of rental activity. Although not a positive sign nor well received by property managers, it is unlikely to be a negative sign for the coming year, and is instead likely a result of poor seasonal weather pushing people indoors, and the thought of moving further back. Amongst the list of primary markets, the most affordable communities are seeing relatively flat month over month rental demand including Calgary, Winnipeg, and Edmonton with a total average decline of -1%. The remaining markets in Ontario, British Columbia, and Quebec all showed outsized declines in active prospects down on average -10.7% monthly. The coming months are likely to show growth in rental demand, with the strongest gains experienced in the most affordable markets.

Primary Market Drill Down (Y/Y): October 2024 vs. October 2023

Notable Changes in Primary Market Demand Over The Past Year

Year-over-year demand scores are down -1.7%, prospects are down -34.1%, and properties are down -7.7%.

The above average decline of February 2025 resulted in the worsening decline of year-over-year comparisons. Of the individual markets Montreal saw the largest overall yearly decline with unique prospects down -50%, and North York coming in as a close second at -46%; while Calgary saw the lowest relative rate of decline down -20.3%. Once again reinforcing the concept that with renters concerned with affordability, the result will be the most affordable markets showing the first signs of recovery. 

Secondary Markets (Populations ~235-600k)

Secondary Markets Drill Down (M/M): October 2024 vs. September 2024

Notable Changes in Secondary Market Demand Over The Past Month

Secondary markets demand scores are down -16.0% month-over-month, unique prospects are down -15.4%, and property counts are up 0.6%.

Secondary markets saw above average declines in active prospects relative to the broader country, however, they showed lower rates of decline when compared against tertiary markets, which saw the greatest declines of all market segments. Amongst the secondary markets, none were immune to the decline in rental activity with Kitchener and Etobicoke faring the best while markets such as Surrey, and Victoria saw the greatest rates of decline. Secondary markets, which offer a mix of local employment options, along with access to larger employment markets, are experiencing a softer relative decline. This suggests that renters continue to search out markets which offer better perceived affordability alongside access to a wide variety of employment opportunities.

Secondary Market Drill Down (Y/Y): October 2024 vs. October 2023

Notable Changes in Secondary Market Demand Over the Past Year

Overall, year-over-year demand scores are down -24.3% year-over-year, with prospects down by -38.5%, and properties are up by +11.9%.

Secondary markets are the only market segment which show a combination of declining renter activity, alongside growing property availability. This imbalance will only further strengthen the value proposition they offer prospective renters as they move further into the space of a renters' market with fewer renters having substantially more options available to them.

Tertiary Markets (Populations ~100-235k)

Tertiary Markets Drill Down (M/M): October 2024 vs. September 2024

Notable Changes in Tertiary Market Demand Over The Past Month

Demand scores in tertiary markets declined by -14.8% month-over-month, unique prospects are down -19.9 %, and available properties are down -6.0%. 

Tertiary markets maintain their position at the back of the pack amongst market segments with the highest rates of declining prospect counts. Not all markets in this segment are experiencing the same trends, those offering the greatest relative affordability showing moderation in monthly rental activity, and the least affordable markets in this segment see outsized declines in rental demand. 

Tertiary Markets Drill Down (Y/Y): October 2024 vs. October 2023

Notable Changes in Tertiary Demand Over the Past Year

Overall, year-over-year demand scores are down by -0.8%, unique prospects are down by -26.9%, and available properties are up +1.5%. 

Although tertiary markets saw the largest overall declines in month-over-month rental activity, yearly demand comparisons show a more positive trend with the decline of unique prospects 20% below that of the national average. This is due to rental activity in tertiary markets having already been depressed this time last year. With a smaller overall universe of prospective renters, these markets were already in the midst of a renters-market, and as a result, the relative decline in rental demand has been lower annually than that of larger markets, which benefit from a larger population of prospective renters. Additionally, the lower relative rate of decline is due to select markets which have rebounded from last year's lows and show annual growth in active renters including East York, Sudbury, and Cambridge.

Conclusion

After a surge in rental demand in January, February brought a sharper-than-usual seasonal slowdown, with national active prospects declining by -9.6%. While a dip in activity is expected after January, this month's decline exceeded the five-year historical average, largely due to severe winter storms across southern Ontario and Quebec and economic uncertainty. The looming threat of tariffs has added another layer of hesitation, with some renters delaying moves due to concerns about rising living costs.

Despite this temporary setback, the rental market remains on track for stabilization rather than sustained decline. Many renters likely paused their searches, waiting for better weather and more clarity on potential economic impacts, rather than stepping away from the market entirely.

What’s Next for Canadian Rental Demand?
Rental demand in the coming months will depend on broader economic conditions. If there are no major financial disruptions, we expect a gradual rebound in rental activity. Primary markets—which benefit from larger renter populations, stronger incomes, and solid economic fundamentals—are expected to recover first, followed by secondary markets with growing job opportunities and strong regional access. However, not all cities will recover at the same pace. The biggest gains will likely be seen in markets that offer better affordability compared to their surrounding areas.

Affordability Will Drive Market Shifts
With high living costs, tariff concerns, and inflation pressures weighing on household budgets, renters are becoming more cost-conscious. This will likely impact the most expensive primary markets, where even strong amenities and lifestyle benefits may not be enough to keep demand steady. Meanwhile, smaller cities, suburban neighborhoods, and communities with lower living costs and more affordable housing options are expected to see increased demand.

In this shifting landscape, property owners, managers, and marketers will need to ensure their properties stand out to attract quality renters in a more competitive environment.

Methodology

To present this data, Rentsync has determined three key calculations for each area of the report, They are as follows:

• Demand Score: Our demand score is rated out of 10 (with 10 being the highest score a city can receive), and is calculated based on unique leads per property, per city, and compared against benchmark data.
  • For Example East York, ON received a demand score of 6.1 this month, versus 4.4 last month. East York experienced a 1.7-point increase in its demand score.
    
    
• Demand Percentage (% +/-): This is determined according to the year-over-year (YOY) or month-over-month (MOM) increase or decrease in unique leads per property.
  • For Example The month-over-month demand scores in East York, ON  increased by +39% in October 2024 versus September 2024. The year-over-year demand score in East York increased by 2.2  points representing a 54% increase from October 2023.
    
    
• Position: The position is determined by unique leads per property, with cities that have at least *20 properties or more. The position will vary depending on demand.
  • For Example This month, East York, ON maintained the top spot in our Top Canadian Cities in Demand rankings from last month.
    
    *This report provides month-over-month rental listing data for October 2024 versus September 2024 and a year-over-year comparison from October 2024 versus October 2023. It also outlines the month-over-month and year-over-year trends in primary, secondary, and tertiary markets.