Rents are now significantly higher than the pandemic-era trough seen in early 2021, new report says
Average monthly rents in the Greater Toronto Area spiked by 21% (approximately $430) annually in August, according to a new report from TorontoRentals.com and Bullpen Research & Consulting.
This surge pushed the average across all rental property types to $2,528. Rents have appreciated by 28.2% above the pandemic-era lows of early 2021, the report said.
The increases were apparent in every residential asset class. The average monthly rent in Toronto increased by 30.7% for apartments (reaching $2,533), and by a whopping 43% for condo units (reaching $2,963).
“The largest factor in the rent inflation is the Bank of Canada’s decision to raise interest rates, which has made owning a home more expensive and resulted in a swift decline in prices in the resale market,” the report said.
“With future rate hikes still on the table, demand will continue to increase in the rental market. High demand, combined with tight rental supply, could cause rents to reach new highs in the next few months.”
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Ben Myers, president of Bullpen Research & Consulting, said that another major factor was the four “significant” monthly rate increases that the market saw this year. This was further inflamed by the resulting tenant demand.
“Page views per listing on TorontoRentals.com hit a multi-year high in August, rising 106% annually and 166% from the pandemic-impacted August 2020,” Myers said. “Prospective tenants are seeing limited vacancies due to an extreme imbalance between supply and demand, with year-to-date new housing completions down 22% annually in the metro area per CMHC.”
