The rental apartment market has not been hindered by condominium developments, says a new report from PwC and the Urban Land Institute (ULI).

According to the report, Emerging Trends in Real Estate, rental apartments remain an attractive investment in Canada’s largest cities, especially since condos are often rented out at premium rates.

“Condo development is still a popular real estate investment, as it serves a different segment of the market than most existing rental apartments, and as such the two can work in tandem,” says Mark Noskiewicz, chair of ULI Toronto. “As home prices in the major cities stay high, renting is a reality for many Canadians and real estate investors are happy to capitalize on this need.”

The market for purpose-built rental apartments in Canadian cities could increase, especially as tighter mortgage rules are delaying potential homebuyers from entering the market. The report confirms that integrated land use development and planning will remain important, as there is a demand for connectivity, amenities and mobility.

The report indicates that overall, the Canadian real estate market should maintain its strength into next year. Developers and investors should note that there will be a continued demand for retail, office and residential space located near mass transit lines.