Is Independence Attainable for Young Adults in Canada? Navigating the High Housing Costs

Canada’s increasing rents and housing shortages have not only posed challenges for young adults seeking their own homes, but they are also reshaping the fundamental structure of family living arrangements, as suggested by new research.

The research analyzed census data from 1981 to 2021 across nine major metropolitan regions: Vancouver, Calgary, Edmonton, Winnipeg, Toronto, Hamilton, Ottawa, Montreal, and Quebec City.

The study focused on single-person households, couples, couples with children, and single parents with children, examining these trends in relation to housing accessibility measured through turnover rents adjusted for inflation.

Researchers found a significant correlation between rental prices and household formation. In urban areas where rental rates have significantly risen, many Canadians find themselves unable to transition into their own living spaces, the authors noted.

Increasing rental costs in Canada have resulted in a trend of young adults sharing living spaces rather than establishing independent households. This trend is particularly noticeable among those aged 25 to 29, according to the report.

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Median rent in Toronto and Vancouver accounted for 25 to 27 percent of the median income for young adults in 1981. By 2021, this percentage had increased to 36 to 37 percent, resulting in more people sharing housing costs, the study revealed.

For every $1,000 increase in median rent, there is a 23 percent decrease in the number of young adults establishing their own households.

Over two-thirds of 25- to 29-year-olds in Toronto and Vancouver lived independently in 1981, according to the authors. However, by 2021, this number had dropped to slightly over a quarter in Toronto and around one-third in Vancouver.

Although the study covered data up to 2021, housing costs in Canada’s largest cities have continued to rise.

As of February, the average monthly cost of a Toronto apartment was $2,615, while Vancouver averaged $2,870—its lowest rate since April 2022, as reported by Rentals.ca.

Average rents are $2,217 in Ottawa, $1,974 in Montreal, $1,916 in Calgary, and $1,531 in Edmonton.

Shared accommodation rents have also decreased this year in Toronto, Vancouver, Calgary, Edmonton, and Montreal. Toronto experienced the largest drop, declining by 8.2 percent to $1,176 per person. In Montreal, it fell by 8 percent to $870.

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