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New report shows Lethbridge rent is unaffordable

Plus, rent here for a 1 bedroom place is the least affordable in the province.

Rentals.ca recently released their December 2020 Rent Report, which shows Lethbridge as having one of the lowest rental rates in the country.

The report indicates that the average rent for a 1-bedroom in Lethbridge in November was $953, which was down from $956 the month before but up from $923 in 2019. The $953 pricetag is significantly lower than the national average of $1,402 for 1 bedroom.

For a 2-bedroom place, Lethbridge renters paid about $1112 per month on average last month, which is $638 lower than the national average. Lethbridge’s 2-bedroom average price last month is up from $1,087 in October and up from $1,051 the year before.

According to the report, Lethbridge placed 32nd out of the 35 cities surveyed. This would make it easy to classify Lethbridge as being an affordable place to rent from, but housing affordability isn’t determined by much higher or lower housing costs are relative to housing markets in other parts of the country.

For example, CMHC says that “housing is considered “affordable” if it costs less than 30% of a household’s before-tax income.”

So, let’s calculate what income a household would need for $953 to be an affordable rent price.

If we multiply $953 by 12 months, we find that those renting a 1-bedroom apartment at the average rent price in Lethbridge would end up paying $11,436 over an entire year. Dividing that number by 0.3 means that a household would need to make at least $38,120 a year for this rent to be affordable. That works out to about $18.33 an hour for full-time hours.

The same calculation on the average 2-bedroom rent gives us an annual income of $43,480—or $20.90 an hour—which is how much someone would need to make a year for this price to be affordable. The national average for a 2-bedroom place is $1,750.

But how many households make $38,120 a year (let alone $43,480) in Lethbridge?

The only income level data I could find for Lethbridge was the 2016 census. Given that it’s 5 years old, it may not be entirely representative of current numbers, but I haven’t been able to find anything more recent.

What I discovered is that about 8,905 households people in Lethbridge had a total income of under $40,000 in 2015, which is less than the salary needed for the average rent of a 2-bedroom apartment to be affordable. That’s 23.7% of all those households with income in Lethbridge during 2015.

Keep in mind that Lethbridge’s median household income increased from $63,345 in 2010 to $91,516 in 2015. Assuming a similar increase over the last 5 years, the median income for 2020 could potentially be $131,783, which would mean that a few of the households making under $40,000 in 2015 could be making over $40,000 today.

However, if we assume that incomes have remained stagnant, then about 1 in 4 households with income in Lethbridge cannot afford the average rent of a 2-bedroom apartment in Lethbridge.

At least for the 2-bedrooms.

As far as the 1-bedroom prices go, 5,795 households made under $30,000 a year in Lethbridge during 2015. Another 3,110 made somewhere between $30,000 and $40,000. So, there were at least 6,000 households not making enough to afford the average 1-bedroom prices in Lethbridge, which is about 1 in 6 households in Lethbridge.

As well, in the previous census, 11,340 households in Lethbridge with income were under $40,000, or about 27.2%. In the 2016 census, as I’ve pointed out, that number was 8,905, or 23.7% of those with income, a drop of 3.5 percentage points. If Lethbridge saw the same decrease over the last 5 years, then those making under $40,000 today would be 20.2% of those with income.

Now, keep in mind that the 30% I mentioned above, which CMHC considers the cutoff for what is affordable, includes not only rent but also utilities (electricity, heating, water, etc). According to Ben Myers, the president of the research firm that published the report, the data includes both properties that calculate utilities into rent prices, as well as properties that don’t.

The Utilities Consumer Advocate website shows a range of $309.41–$339.62 a month for electricity and gas together for Lethbridge. My water, wastewater, recycling, and trash collection bill comes to just over $100 a month. So, assuming these rates can apply across the board, and we choose the UCA’s lowest rate, that’s about $350 more per month. That adds an extra $11,138.76 to our annual wage of $38,120, for a total of $49,258.76 or $23.68/hour, with full-time hours.

Statistics Canada groups workers in income levels in $10,000 increments, so it’s difficult to tell how many households in Lethbridge had income of $45,446.76 or less. We do know 23.7% made under $40,000 in 2015, and 31.9% made under $50,000, so the total percentage of households unable to afford the average rent of a 1-bedroom apartment in Lethbridge is at least 23.7%, but possibly as high as 31.9%, if utilities aren’t included in the monthly rent.

In the 2011 census, it was 27.2% under $40,000 and 36.9% under $50,000. That means the numbers dropped by 3.5 and 5.0 percentage points, respectively, by the 2016 census. Assuming similar decreases over the last 5 years, 20.2% of those households with income in Lethbridge would be making under $40,000 today and 26.9% under $50,000.

That’s 1 in 5 of all income earners for 1-bedroom and over 1 in 4 for 2-bedroom, on assumed 2020 incomes.

The report included 5 other Alberta cities in their report. Here’s how Lethbridge compare with them for 1-bedroom rates, relative to average and median wages (2015):

1 bedroom
rent
Avg monthly
wage
Rent as % of
avg wage
Median
monthly wage
Rent as % of
median wage
Lethbridge$953$3,733.7525.52%$3,000.5831.76%
Edmonton$1,022$4,566.7522.38%$3,589.0828.48%
Calgary$1,173$5,380.5021.80%$3,637.5832.25%
Red Deer$953$4,428.2521.52%$3,338.5028.55%
Grande Prairie$959$4,894.5819.59%$4,034.9223.77%
Lloydminster$751$4,968.0815.12%$3,765.7519.94%
1 bedroom
rent
Avg monthly
income
Rent as % of
avg income
Median monthly
income
Rent as % of
median income
Lethbridge$953$7,741.8312.31%$6,173.6715.44%
Edmonton$1,022$9,384.9210.89%$7,268.7514.06%
Red Deer$953$9,199.5010.36%$7,149.5013.33%
Calgary$1,173$11,444.4210.25%$8,111.1714.46%
Grande Prairie$959$9,897.929.69%$8,796.2510.90%
Lloydminster$751$10,424.507.20%$8,504.508.83%

So while Lethbridge is tied for having the second lowest rent in the province, it has the highest rent costs for 1 bedroom as a percentage of both average and median household income.

For the average 2-bedroom rental cost, Lethbridge is highest of the 6 cities at 14.36% of the average household income and second highest for percentage of median household income, at 18.01% (Calgary was 18.25%).

So, not only is rent Lethbridge not affordable for at least 1 in 4 households, it’s less affordable than in other Alberta cities.

Note: An earlier version of this story used individual income, instead of household income. CMHC’s definition of “affordable” is based on household income. This story has been updated so all figures reflect household income.

By Kim Siever

I live in Lethbridge with my spouse and 4 of our 6 children. I’m a writer, focusing on political news, social issues, and the occasional poem. My politics are radically left.

I’m also dichotomally Mormon. And I’m a functional vegetarian: I have a blog post about that somewhere around here. My pronouns are he/him, and I’m queer.

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