Finding a home in your new country: Tips for finding affordable housing
Published June 30, 2022.
Estimated reading time: 4 minutesIn summary:
- Housing affordability is an issue top of mind among new immigrants and refugees to Canada.
- It is important to understand the housing market in the area where you wish to live and work.
- Be wary of rental scams and consider investing in tenant’s insurance.
Much has been said and written about the cost of housing in Canada. Namely, it’s expensive and inaccessible to prospective homeowners and renters. This is a concern for newcomers says a recent study, which points to cost of living and housing affordability as reasons why new Canadians are unsure of their future in this country.
With that in mind, we spoke with experts from Rentals for Newcomers, a website designed to help new Canadians navigate the country’s rental housing market more easily. They offered the following success strategies to support you in finding your new home in your new country.
Pick the right city
This is key to securing long-term housing affordability. Rent (and home buying) prices vary wildly across Canada. While many newcomers tend to land in Toronto, Montreal and Vancouver, it’s wise to check out Canada’s secondary cities such as St. John’s (Newfoundland), Regina (Saskatchewan), Quebec City (Quebec), Moncton (New Brunswick) or Winnipeg (Manitoba), which are usually cheaper in terms of housing costs.
For example, a one-bedroom apartment in Toronto rents for over $2,000 per month. Meanwhile, in Windsor, Ontario, just a three-hour drive from Toronto, a comparable one-bedroom rents for $1,000 per month. If you’re planning to buy a home eventually, that’s a lot of savings each month towards your purchase. Choosing the right city means considering what the area has to offer in terms of employment opportunities, arts, culture, schools, community and newcomer settlement services.
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Watch out for rental scams
The majority of Canadian landlords are honest but scam artists can, and do, try to take advantage of newcomers. So be on guard.
Cash-only deals are the number one rental scam and are a tip-off that something is not right. Remember: cash cannot be traced, so avoid dealing in hard currency. Same with wire transfers “upfront.” Scam artists are always coming up with new tricks to take advantage of renters. Always sign a written lease. A hard copy lease is always preferable though e-leases are becoming common. Oral agreements, another tool used by scammers, are to be avoided. If possible, ensure that the landlord is present when you both sign and that you and the landlord each sign and receive a copy of the lease agreement.
Consider renters or tenant’s insurance
Getting tenant insurance is not mandatory in Canada; however, a landlord may insist that you agree to get it before they rent to you. Landlords have property insurance for the building and your unit but that does not cover your contents like furniture, clothes or laptops. If you do not have renters’ insurance and your valuables are destroyed due to a flooded unit or building maintenance issue you will be required to pay your replacement costs for your things. What if you are the cause of a flood? If you don’t have renters’ insurance, you could be made to pay for all the damage caused to other units. In addition to covering the loss of your personal items, renters’ insurance can also cover you for personal liability if, for example, someone is injured visiting your apartment. It can also cover temporary living expenses if you are forced to move out due to damage to your unit.
How much insurance coverage do you need as a renter? You can often get basic coverage for as little as $25 to $30 per month.
Do your research to understand trends in home ownership and rentals
Vacancy rates are a key driver of rental housing costs in Canada. Occupancy is also a factor in rental prices. What are occupancy and vacancy rates? The occupancy rate refers to rental housing demand, while the vacancy rate refers to rental housing supply. A HIGH vacancy rate in a city means a greater housing supply which can lower the cost of rental housing. A LOW vacancy rate will cause higher rent prices. Understanding these drivers can help you to find more affordable housing options. A 3 per cent vacancy rate is considered normative or healthy for a given market.
Similarly, understanding trends in Canadian home ownership markets can enable you to make better-informed decisions about when you may be ready to enter the market and purchase your first home.
Below, we’ve pulled together some websites that highlight Canadian housing trends.
Canadian Mortgage and Housing Corporation Market Reports
Canadian cities with cheapest rents
Canadian Real Estate Association Housing Market Statistics