Has the Rent Gap Between Large and Small Canadian Cities Ever Been This Narrow?
The long standing gap between big city and small city rents in Canada is shrinking, as asking rents in major urban centres cool and prices in smaller cities continue to rise, reshaping assumptions about affordability across the country.
Rental markets across Canada have shifted. Rents in the country’s largest cities have started to cool slightly. At the same time, many smaller and mid-sized cities have seen steady increases. As a result, the difference in asking rents between large and small cities has narrowed more than at any point in recent memory.
This change is showing up in multiple sources, including national rent reports and new data from Statistics Canada. In some cases, the gap between cities like Toronto and Halifax, or Vancouver and Calgary, is now just a few hundred dollars.
It raises a few important questions. Are renters in smaller cities now facing prices that no longer match local wages? Is this a temporary adjustment or a more permanent change? And how different is today’s rent gap compared to what it looked like five, ten, or thirty years ago?
The Shift in the Numbers
Over the past two decades, there has been a clear rent premium for living in large cities like Toronto and Vancouver. That premium is now shrinking. According to the July 2025 Rentals.ca report, average asking rents for a one-bedroom apartment in Toronto have dropped nearly $300 over the past year. In Halifax, they have gone up.
| City | June 2019 | June 2021 | June 2023 | June 2025 |
|---|---|---|---|---|
| Toronto | $2,266 | $1,836 | $2,572 | $2,283 |
| Vancouver | $1,990 | $2,056 | $2,945 | $2,529 |
| Calgary | $1,310 | $1,239 | $1,687 | $1,602 |
| Halifax | $1,130 | $1,531 | $1,806 | $2,059 |
| Saskatoon | $1,123 | $941 | $1,110 | $1,260 |
The difference between Toronto and Halifax, which once felt significant, is now about ten percent. Vancouver’s average rent is still higher than Calgary’s, but the gap has narrowed there too. Across the board, the long-standing price difference between large and small cities is not what it used to be.
What's Causing The Shift
In the biggest cities, supply is finally starting to catch up. Over the past year, more purpose-built rentals and new condo units have entered the market. That has given renters a bit more choice. It has also pushed some landlords to offer incentives again, such as a free month of rent or reduced parking fees. These offers mostly disappeared during the peak of the rental market in 2022 and early 2023.
At the same time, smaller cities have continued to attract new residents. The pandemic kicked off a wave of movement away from major centres, and many of those moves turned out to be long-term. Cities like Halifax, London, and Kelowna have seen sustained population growth. Many of the newcomers are renters, and their arrival has pushed demand and prices up.
It’s also worth noting that rent growth in smaller cities often starts from a lower base. That can make the increases look modest in dollar terms, but steep in percentage terms. And once prices reset upward, they rarely fall, even if local wages don’t keep pace.
A Bit of Historical Context
From the early 1990s through the 2010s, the gap between large and small cities grew steadily. Economic growth became more concentrated in a few urban centres. So did immigration, capital, and higher-paying jobs. Rents followed the same path.
CMHC data from the early 2000s shows that average rent in Toronto was about 35 percent higher than in Halifax, and about 25 percent higher than in Calgary. By 2019, that difference had grown to more than 50 percent.
| City | 1990 | 1995 | 2000 | 2005 | 2010 | 2015 |
|---|---|---|---|---|---|---|
| Toronto | $557 | $660 | $832 | $889 | $952 | $1103 |
| Vancouver | $566 | $641 | $695 | $788 | $941 | $1080 |
| Calgary | $458 | $466 | $614 | $669 | $897 | $1126 |
| Halifax | $485 | $506 | $545 | $629 | $737 | $840 |
| Saskatoon | $363 | $381 | $443 | $479 | $768 | $898 |
There used to be a clearer tradeoff. Big cities came with higher salaries, but they also came with higher costs. Smaller cities offered more affordable housing, even if job opportunities were fewer. That basic logic held for years.
It doesn’t hold as well now. Rents in smaller cities have outpaced income growth. And while some big cities have seen prices flatten or fall slightly, they haven’t become more affordable in any meaningful way.
The List of Affordable Cities is Shifting
For years, rent levels followed a kind of internal logic. Big cities were expensive, but they offered density, transit, job markets, and all the things that made the cost feel at least somewhat justifiable. Smaller cities were cheaper, but you gave up a few of those perks in exchange for lower rent.
That logic is changing. If rent is rising everywhere, does the idea of “affordable cities” still mean anything, or are we just watching the old list get reshuffled?
Cities like Halifax, Calgary, and Kelowna have seen rapid increases in asking rents over the past few years. They’re no longer the budget-friendly alternatives they once were. But that doesn’t mean affordability has disappeared entirely. It just means the list of affordable cities is different now.
Cities like Saskatoon, Winnipeg, and parts of Atlantic Canada still offer relative affordability. The composition of that list is changing, but the category itself still exists. It’s just narrower, and for many people, less conveniently located.
So the idea of the “affordable city” isn’t gone. But the places that fit the label have changed. And for renters, that means adjusting expectations, not just about price, but about where it’s still possible to find affordable rental options.
