The city of Toronto has finally surpassed Vancouver in having the priciest apartments in Canada. This is mainly due to the shortage of housing.
As stated by Padmapper, a rental site, a one bedroom Apartment in Toronto currently is being rented for an average of $2,020, that is a 15.4 per cent increase within a year and as for that of Vancouver above $2,000.
Crystal Chen, Padmapper spokesperson told the HuffPost Canada that “The huge year over year rental growth is mostly due to the fact that the demand for rental units in Toronto is far outpacing the supply. Until there are new units to meet this ever growing desire to live in Toronto, not much relief will come in the near future”.
This recent change is no surprise to the people of Toronto, where there have been a growing shortage of rental housing for years. The CMHC released a report in November stating that Toronto’s apartment vacancy rate dropped by 1.1 per cent in 2017, that’s the lowest its hit in 16 years.
Dana Senagama a CMHC market analyst indicated that “Rising costs of home ownership and lack of new rental supply kept vacancy rates at historic lows.”
The Condo market experienced something similar. Urbanation, a research firm published a report recently, stating that condo rental prices in Toronto rose by 9.1 per cent over the year. Due to tighter market condition, the amount of units leased dropped by 11 per cent and the number of new listings also fell by 16 per cent .
Shaun Hildebrand, the senior vice president of Urbanation stated “Persistently strong rent growth throughout 2017 was simply the result of demand fundamentals for renting far outweighing supply. This has raised the confidence of developers to add more units to the pipeline, a trend that will need to continue in order to meet future housing needs for the GTA.”
Hildebrand mentioned that increasing rent prices are leading to many tenants to stay where they are than go in search of a new house. This led to making rental housing supply crunch even worse.
Last fall, the CMHC reported that Vancouver’s vacancy rate has gone up a little bit by 0.9 per cent. Even with that low vacancy rate, it’s higher than the 0.7 per cent rate Vancouver recorded in 2016.
With Toronto and Vancouver experiencing shortages in housing supply, Montreal recorded the fastest growing rental rates. For a one bedroom apartment rental rates went up by 15.9 per cent, to $1,310.