Average monthly rents in the Greater Toronto Area surged 21 per cent on a year-over-year basis in August, according to the latest rent report by Rentals.ca and Bullpen Research & Consulting.
Rent for all property types was up $430 to $2,528 from $2,098 in August 2021, further surpassing the pre-pandemic high of $2,461 recorded in 2019. The average is also now 28.2 per cent above the COVID low of $1,972 per month set last April.
August rent was also up on a monthly basis, rising 2.7 per cent since July. Rental rates in the GTA have now risen by two per cent or more for the past four consecutive months, following a rise of 5.7 per cent in May, which was a multi-year high.
Rent inflation can largely be chalked up to the rising interest rate environment, “which has made owning a home more expensive and resulted in a swift decline in prices in the resale market,” the report said.
With the Bank of Canada expected to continue to hike interest rates, demand for rental properties could persist.
In the Toronto market, apartment rents jumped 20.1 per cent. The area with the highest average across all property types was the Bay Street Corridor, at $2,779.
So far in the third quarter, average rents in Toronto have increased 13.8 per cent from the second quarter, ahead of North York (10.1 per cent), Scarborough (9.4 per cent), Etobicoke (5.7 per cent) and Mississauga (5.1 per cent).
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“From May to August, the Greater Toronto Area rental market has experienced four significant monthly rent increases, as tenant demand has skyrocketed due to interest rate changes, a resale house price correction and the typical seasonal fall uptick,” said Ben Myers, president of Bullpen.
He noted as well that listings on TorontoRentals.com hit a multi-year high in August, doubling over the past year and up 166 per cent from August 2020.
“Prospective tenants are seeing limited vacancies due to an extreme imbalance between supply and demand, with year-to-date new housing completions down 22 per cent annually in the metro area per CMHC,” he said.
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