As the real estate market continues to show signs of weakening, the cost of renting in Toronto is on the rise.
New data released by the Toronto Region Real Estate Board for the second quarter of 2022 shows that the median rent charged for one- and two-bedroom condos has now hit a new record high, after earlier falling in the COVID- 19.
The median one-bedroom rent rose 20.2% year-over-year to $2,269 per month, while the median two-bedroom rent increased 15.3% to $2,979.
The smallest bachelor units rose 25 percent to $1,829 a month, but have yet to reach the peak reached in the third quarter of 2019.
“Expect rental market conditions to tighten further in the coming months. Higher borrowing costs may have temporarily prevented home purchases for some households, but the Greater Toronto Area population ( (GTA) continues to grow alongside a booming regional economy. That means an increasing number of people who need a place to live are turning to the rental market,” TRREB President Kevin Crigger warned in a press release that accompanies the data.
The average cost of a home in the GTA has now fallen for four straight months and at least one major bank is warning of a “historic” housing correction that could send prices down as much as 14 percent from maximum to minimum
The rental market, however, shows no signs of slowing down.
The latest TRREB data suggests that rental listings were down 30% year-over-year in the second quarter, leading to a significant increase in competition for some units.
The condo vacancy rate in the GTA also remains extraordinarily low. In Toronto, about 1.9 percent of apartments are vacant, while the vacancy rate in other GTA communities ranges from 0.3 to 0.9 percent.
“Competition among tenants continues to increase, resulting in extremely strong upward pressure on average rents,” TRREB Chief Market Analyst Jason Mercer said in the statement. “Rental supply remains a significant issue in the GTA and will become more pronounced in the near term as an increasing proportion of well-employed people turn to the rental market.”
TRREB says the median sales price for condos in the second quarter reached $769,999, up more than 12 percent from the same period in 2021.
The pace of growth, however, has begun to slow amid an aggressive campaign by the Bank of Canada to raise interest rates. Prices rose more than 16 percent year-on-year in the first quarter.