Western Canada’s rental market has consistently drawn renter attention, but the fundamentals shaping each province tell very different stories. Ahead of the Western Canada Apartment Investment Conference, our team of industry experts breaks down the trends influencing the region’s most competitive markets.
British Columbia
As with most of the country, BC is currently in a rebalancing phase of the apartment market cycle. CMHC reported that overall vacancy in October 2025 increased to 3.5% from 1.9% year over year, driven by an influx of new supply and weakening demand, primarily due to curtailed immigration.1 In response to softening market conditions, BC’s asking rents reported in March 2026 are 4.8% lower year over year and more than 7% lower than in March 2023.2 Apartment cap rates in Metro Vancouver remain elevated, trading at 100 to 150 bps above their historical lows of 5 years ago. This reflects a market with lower valuations, which has resulted in more conservative underwriting assumptions for both purchasers and lenders.
On the development side, the slowdown in new condo and rental projects is placing downward pressure on the cost of trades. In talking to industry players, construction costs in the province are expected to decrease by up to 5% this year. Notably, pushback from the development community against sharply rising municipal pre-development fees has prompted both local and provincial governments to freeze, reverse, or grandfather the planned increases.3,4 Other measures are being contemplated or implemented to incentivize housing starts, such as a provincial deferral program that postpones the majority of development and permitting charges until project completion.5 Despite promising attempts to support the delivery of housing, proformas remain challenged due to the current economic cycle.
“Well-capitalized private buyers are taking advantage of the current market rebalancing by acquiring assets that are often trading well below replacement costs. Developers remain opportunistic, acquiring development sites at values that fit into proformas reflecting the reality of the current market environment. The major headwinds experienced over the last two years have caused new construction starts to slow, and as a result, a significant supply shock is anticipated in the medium term that will buoy the industry to equilibrium.”
Looking ahead, there remains a major housing shortage across BC that will require ongoing development in the multifamily sector to address affordability concerns supporting rental development across the province.
Alberta
The Alberta market is currently transitioning from a period of rapid acceleration into a phase of stabilization. As new supply hit the market, demand softened, cooling rents to more moderate levels. As a result, Calgary and Edmonton have seen vacancy rates jump from roughly 2% to 5%, with CMHC projecting vacancy rates to continue to increase before levelling off in 2027.6
“Looking ahead to the next 12 to 24 months, developers will already be pulling back on new starts with forecasts pointing to a material shortfall emerging in 2027 through to 2029. As a result, investors who are acquiring assets through the current soft period are likely to be well-positioned when this supply shift arrives. Alberta’s favourable tax regime and positive net migration continue to make it one of Canada’s more attractive apartment markets.”
Saskatchewan
The Saskatchewan market can be characterized as stable, with moderating growth, yet it continues to stand out as one of Canada’s more affordable and investor-friendly regions, supported by resilient occupancy and positive rent trends relative to broader national softening. Peakhill’s bridge platform is particularly well-suited for this environment, enabling borrowers to execute value-add strategies through targeted CapEx programs, stabilize assets, and transition into CMHC-insured takeouts. Concurrently, CMHC term and construction financing remain competitively priced and widely utilized across the market.
“Recent Peakhill transactions include a 160-unit CMHC construction takeout, a 46-unit value-add bridge, a 36-unit portfolio bridge across three properties, and multiple financings of stabilized assets ranging from 6 to 20 units. In 2025, Peakhill originated over $191 million in Saskatchewan, with 2026 volumes expected to well exceed that figure.”
Overall, Saskatchewan’s combination of low entry costs per door, stable occupancy fundamentals, reduced volatility, and strong cash flow, supported by attractive CMHC-insured financing, continues to underpin a compelling investment thesis for Saskatchewan.
Manitoba
Manitoba’s multifamily market continues to demonstrate relative stability compared to more cyclical regions in Western Canada. This is supported by steady population growth, modest rent increases, and a historically prudent lending environment. Rental demand in Winnipeg remains heavily influenced by immigration, particularly non-permanent residents. Reduced immigration through 2027 is expected to continue impacting rental demand.6 Demand is generally underpinned by relative affordability, tight vacancy rates, and consistent immigration.
Transaction activity within Winnipeg has been steady over the past several quarters. Interest rate changes continue to be the main factor influencing market activity.7 Asset values across Winnipeg’s established rental corridors have remained resilient. The buyer pool is still largely composed of local and regional investors, along with select private capital and smaller REITs focused on stable income rather than near-term appreciation.
“Underwriting remains disciplined but workable. Cap rates have expanded into the 5% to low-6% range with value-add strategies, particularly repositioning vintage assets, continuing to deliver viable returns. However, Manitoba Bill 13, which would further expand rent regulation, may temper new development and reinforce conservative underwriting, placing increased emphasis on operational efficiencies within existing assets.”
Looking Ahead
Apartment markets across Western Canada each carry their own dynamics, yet demand for flexible and reliable financing remains consistent. Peakhill supports borrower clients across the region with tailored solutions built for local market conditions.
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Let’s continue the conversation
Footnotes
- CMHC. 2026. Housing Market Portal. ↩︎
- Rentals.ca. 2026. Rentals.ca April 2026 Rent Report. ↩︎
- BC Gov News. 2026. More support for builders will unlock more new homes in Metro Vancouver. ↩︎
- DH Urbanized. 2026. Metro Vancouver Regional District ponders $389-million cut to developer fees to support new housing. ↩︎
- BC Gov News. 2026. More flexibility for development charges unlock more homes for people. ↩︎
- CMHC. 2026. Housing Market Outlook 2026. ↩︎
- Colliers. 2026. Cap Rate Report Q1 2026. ↩︎
This article is for information and discussion purposes only. The contents of this article are not to be construed as investment, legal, business, or tax advice. Peakhill does not provide tax advice. Please consult with a qualified tax professional or financial advisor to understand how any investment decision may impact your individual tax situation. If any information related to the contents of this article, or regarding Peakhill’s corporate strategy and organization, is provided at any time, orally or otherwise, such information is provided as a convenience only without representation or warranty as to its accuracy or completeness and should not be relied upon without independent investigation and verification. All investments carry risks, and past performance is not indicative of future results.
