The latest data by Rentals.ca and Bullpen Research and Consulting shows that the average rent for a one-bedroom apartment in Toronto has hit $2,300, with a two bedroom going for just under $3,000.
Nationally, average rents shot up by 4.3% over the last month, twice the right of inflation. 2019 was a blockbuster month for rent increases, with Toronto hitting 9%, Montreal at 25%, and Vancouver at 11% rent growth. Montreal’s strong economy, Quebec’s strong public finances, and significantly lower prices than Toronto and Vancouver are all powerful factors transforming Montreal real estate. The average rent in Montreal is now $1,350, which would be considered a miracle bargain in Toronto, and in Vancouver, average rents are $1,940, still much cheaper than Toronto.
Toronto’s two-bedroom monthly rent average is now greater than the monthly mortgage payment for a $550,000 TD fixed rate 3.2% mortgage amortized over 25 years ($2,833). 550K can buy you a small condo in Toronto if you can snag it (likely not in the downtown core though). An analysis of average rents nationally shows some interesting numbers. Rents across southern Ontario are exceedingly high. Oakville is at $2,100 a month, Richmond Hill and parts of Northern Toronto are at $1,800-$1,900 a month, and Hamilton is at $1,500. These are all figures for one-bedroom units. The cheapest one bedroom rent in southern Ontario is in Kitchener and London, with $1,100 being the rough average. The cheapest rents in the country are in St. John’s, Newfoundland at $885.
The projection for this year isn’t rosy for renters. Rents are expected to rise by 3% overall in the country and 7% in Toronto. One area where there has been a fair increase in supply in Toronto has been midtown but rents there are high and most of the supply stock is new condo development. Cheaper, more traditional rental buildings have availability in short supply and getting approved is especially difficult for prospective renters with low credit, weak employment opportunities, or poor connections. The supply and demand picture is not expected to shift dramatically to change these trends, and rents will continue to surge.