Cap rates by city / Vancouver
Vancouver cap rates in 2026
Apartment buildings in Vancouver traded at cap rates of 3.5% to 4.75% in CBRE's second-quarter 2026 survey, the lowest of the 13 Canadian cities CBRE surveys. Here is what sits behind that number, what CMHC says about vacancy and rents, and what a building is worth at the local yield.
Apartment cap rate
3.5% to 4.75%
CBRE, Q2 2026, Class A to B
Vacancy rate
3.7%
CMHC, October 2025
Average two-bedroom rent
$2,363
CMHC purpose-built, October 2025
Rent growth, 2025
2.2%
CMHC, two-bedroom, year over year
Run a Vancouver building through the calculator
Preloaded with a six-unit building at Vancouver's CMHC average two-bedroom rent, the city's vacancy rate, and generic expense assumptions ($1,800 tax and $600 insurance per unit, 8% maintenance, 5% management, $900 utilities per unit). The price is set so the building lands at the middle of the local range. Replace every number with your own.
Property & income
What you would actually pay, not the assessment
All units combined
Operating expenses (annual)
Of gross rent; 5–10% is typical
0 if self-managed
Condo fees, snow, lawn care
Your market
What similar properties trade at in this market
Cap rate
4.12%
$121,923 NOI on $2,956,000
Cap rate deliberately ignores financing: it is NOI divided by price, so you can compare properties regardless of how each buyer pays. The implied value inverts it: the price at which this NOI would hit your target cap rate. Useful as a negotiating anchor.
What the same building is worth across the range
The six-unit example above produces $121,923 of net operating income a year. Value is NOI divided by cap rate, so a half-point move in the market's cap rate changes the price by more than most renovations would:
| Cap rate | Building value |
|---|---|
| 3.5%low end | $3,483,523 |
| 4.13%middle | $2,955,716 |
| 4.75%high end | $2,566,806 |
Per unit: $580,587 at the low end to $427,801 at the high end.
Why Vancouver trades where it does
Vancouver has the lowest apartment cap rates in Canada, 3.5% to 4.75% across high-rise and low-rise product, because a large share of any purchase price is land. Buyers underwrite redevelopment value and long-run rent growth rather than today's income, and the deep pool of institutional and private capital keeps bidding for the few buildings that trade. A 3.5% to 4.75% cap rate on a rent-controlled building means most of the return has to come from appreciation.
Vacancy, rents and the 2026 outlook
The 2025 CMHC survey put Vancouver's purpose-built vacancy at 3.7%, the highest since 1988, and two-bedroom rent growth slowed to 2.2%. Record completions and weaker population growth are doing that. With the 2.3% guideline capping sitting-tenant increases and turnover rents softening, income growth is the slowest it has been in years, which is why cap rates have not compressed further.
Rent rules in British Columbia
BC caps rent increases on sitting tenants at 2.3% for 2026, with three months' notice. Rent resets to market only when a tenant leaves. That rule sets how fast in-place income can grow, which is why two buildings with identical rent rolls can trade at different cap rates depending on how far below market their tenants sit.
Cap rate against your mortgage rate
At a 4.13% cap rate, a mortgage costing more than 4.13% makes leverage work against you: every borrowed dollar earns less than it costs until rents grow. In Vancouver that is the normal condition at 2026 mortgage rates, so the return depends on appreciation and rent growth rather than cash flow. Put the same building through our rental property calculator to see the cash flow with the Canadian semi-annual mortgage formula.
Frequently asked questions
What is a good cap rate in Vancouver?+
For a stabilized apartment building, 3.5% to 4.75% is the institutional range in CBRE's Q2 2026 survey, with high-rise product at the low end and older low-rise walk-ups at the top. A small investor buying a condo or house to rent will usually see 2% to 3% after honest expenses, which only works if prices keep rising. Anything above 5% in Vancouver deserves a hard look at why: deferred maintenance, a difficult tenancy, or a location the market discounts.
Why are Vancouver cap rates so low?+
Land. In Vancouver the dirt under a building is often worth more than the building, and land produces no rent. Add strong long-term demand, limited supply, deep buyer pools and the expectation of rent growth on turnover, and buyers accept a low income yield for the total return. Rent control on sitting tenants makes the gap between in-place and market rent part of the price too.
Is Vancouver a good market for cash flow?+
No, on the numbers. At a 3.75% cap rate and a mortgage rate near 4.5%, borrowed money costs more than the property earns, so leverage reduces your return until rents catch up. Vancouver is an appreciation and land-banking market. Run the deal through our rental property calculator with the Canadian mortgage formula before assuming the rent covers the payment.
How Vancouver compares
| City | Cap rate | Vacancy |
|---|---|---|
| Vancouver | 3.5% to 4.75% | 3.7% |
| Toronto | 3.85% to 5.15% | 3% |
| Montreal | 4.25% to 4.75% | 2.9% |
| Victoria | 4.25% to 5% | 3.3% |
| Winnipeg | 4.5% to 5.25% | 2.8% |
| London | 4% to 6% | 4% |
| Calgary | 4.5% to 5.5% | 5% |
| Halifax | 4.5% to 5.5% | 2.7% |
| Quebec City | 4.25% to 6% | 2.4% |
| Edmonton | 4.5% to 5.75% | 3.8% |
| Ottawa | 4.5% to 5.8% | 3% |
| Kitchener-Waterloo | 4.5% to 6% | 4.1% |
| Saskatoon | 5.25% to 6.75% | 3.3% |
Sources: CBRE Canadian Cap Rates & Investment Insights, Q2 2026 (cap rate summary, high-rise and low-rise Class A to B); CMHC Rental Market Report, October 2025 survey. Survey ranges describe stabilized, professionally managed buildings; individual sales print outside them. Measure your own deal with the cap rate calculator.