Advertisement

Demand for rental units on the rise in Saint John

The City of Saint John has released a study projecting thousands of new residential units will be needed to house the city's growing population in the next few years.

Jeff Cyr, manager of strategic projects for Develop Saint John, presented a report to the city's growth committee on Tuesday, showing 1,500 rental units are already in development and thousands more will likely be needed.

The study was prepared by Turner Drake & Partners real estate agency on behalf of the city and Develop Saint John, an arm's-length economic development agency for the city.

The study suggested baby boomers are driving rental demands in two ways: they are downsizing to apartments or condos instead of aging in their single-family homes, and when they retire their jobs are being filled by immigrants moving to the city.

Discover Saint John/Submitted by Architects' Association of New Brunswick
Discover Saint John/Submitted by Architects' Association of New Brunswick

Uptown Saint John is a particularly hot market right now, Cyr said, and demand doesn't seem to be going anywhere.

"They're interested in more efficient rental apartments and a lot of them are kind of moving to the uptown and attracted to the vibrancy and the lifestyle opportunity available there," he said.

Uptown is attracting more than just boomers, though. Cyr said as more businesses have opened up, the neighbourhood has become more attractive to people of all ages, from young professionals to families.

A stronger housing market has also allowed more people to sell their homes and move into rental units, further driving up demand.

Cyr said the east side, central peninsula and Millidgeville can also expect residential growth.

Shift in vacancy

It's a big change from just over five years ago when the vacancy rate in Saint John was at a high of 12 per cent. Now, it's down to three per cent in 2019.

"Anything that's been built in the last 20 years is at less than one per cent vacancy," Cyr said.

Cyr said the study looked at both demographic and psychographic data, which deals with peoples attitudes, interests and values.

"Psychographic data is is not just looking at someone's age and and income status, but it's looking at, you know, what percentage of people in the baby boomer market tend to want to live in urban areas and shop local."

Submitted by Uptown Saint John
Submitted by Uptown Saint John

Development projects like the Telegraph building on Canterbury Street and the East Point Shopping residential revamp are already underway, but construction likely won't begin until next year, Cyr said.

As demand rises, so do rents, but Cyr said those might take a dip as new units are filled.

"What we need to do is we need to accommodate and we need to absorb as much of that demand in new construction so it eases the pressure," he said.