Canada’s multi-family real estate vacancy hit a five-year high for the second-straight quarter, says a new Yardi report.

Vacancy rose 110 basis points year-over-year to 4.3% in the third quarter, and was up 20 bps from the half-decade high of 4.1% posted in the second quarter.

Montreal saw the biggest vacancy increase the third quarter as the rate climbed 1% year-over-year to 5.6%. The increase came after the market’s purpose-built rental-housing inventory rose 3.3%. Calgary maintained the highest vacancy rate (5.8%) but its vacancies dropped 90 bps quarter-over-quarter. Winnipeg (2.4%) and Halifax (2.8%) had the lowest vacancy rates.

The market continues to decelerate amid weakening demand and slowing new-lease rent growth following several years above-trend increases, according to Yardi.

But the analytics company’s findings indicate that the market is healthy as the Canadian economy struggles under weight of rising U.S. tariffs and weakening employment.

“In the midst of an uncertain economic climate, Canada’s multi-family market is maintaining moderate rent growth and strong demand in most markets,” said Yardi.

The report says that former market leaders such as Calgary saw lease-over-lease rents fall 3%, and average bachelor-unit vacancy reached 6.7%, the highest among all unit types. Toronto’s bachelor-suite vacancy rate (8.9%) was well above the national average.

Meanwhile, the average national in-place rent rent increased $14 to $1,734 as the annual growth rate dropped 90 basis points year-over-year to 3.9%

Halifax, due to its growing technology market, saw the biggest year-over-year in-place rent increase (5.9%), a $29 rise to $1,634.

Edmonton (4.9%), Saskatoon (4.7%) and Montreal (4.6%) also post strong rent gains. Calgary (1.1%), Ontario’s Kitchener-Cambridge-Waterloo region (3.1%) and Toronto experienced the lowest increases.

Halifax also posted the largest new-lease rent increase (4.9%), while Ottawa-Gatineau and London, Ont., tied for second (4.3%) and Montreal (2.9%) ranked third. Calgary, with its 3% decline, Hamilton (0.3%), Kitchener-Cambridge-Waterloo (0.8%), Toronto (1.2%) and Vancouver (1.4%) were the worst-performing markets when it came to new-lease rent growth.