Over the past few years, Toronto’s real estate prices have skyrocketed. This had the effect of pricing many potential homebuyers out of the market, and now even the rental market is being hit hard by rising prices. Those looking to gain a spot in one of the city’s affordable housing units, must now do so by lottery where the odds are approximately 50:1.
So what exactly is going on with Toronto’s rental market? Here are a few reasons why people are finding it more difficult to get an affordable place in the city.
- People are putting off home ownership. Even though the housing market in the GTA has cooled a bit in recent months, home prices in Toronto have still climbed considerably higher in recent years than they have in other parts of the country. This means that people who might ordinarily have been looking to buy, are still in the rental market and taking up supply.
- Influx of immigrants and refugees. Eating up even more of the rental supply in Toronto, are the influx of new immigrants. While our neighbours to the south have been restricting immigration, Canada has taken in a record 413,000 people over the past year. And between refugees, international students and skilled foreign workers, there have been more than 100,000 internationals that have landed in Toronto over the past twelve months. For refugees, it typically takes between four and six months for them to find housing and once they do find it, they generally spend about 85% of the social assistance on it.
- More high-tech jobs have come to the city. Additionally, Toronto has gained more high-tech jobs with companies such as Microsoft Corp. and Uber Technologies. And while this is great news for our local economy, it is adding additional stress on Toronto’s rental market since more high earning professionals are moving here to obtain positions in these companies.
- Supply isn’t keeping up with demand. Condo completions in Toronto are currently running at a five year low and while there are rent controls on existing units, the provincial government has dropped this requirement for new builds.
All of these factors have resulted in a perfect storm for Toronto’s rental market. Along with high rents, there has been a predictable increase in homeless along with an increase in couch surfing.
While policy makers are starting to address the problem (for example, John Tory has made a commitment to bring 40,000 more affordable housing units to the City over the next ten years), it would seem that the current crisis in the market is liable to continue for some time to come.
Finding an affordable to place to live in Toronto has become extremely challenging regardless of whether you are looking to rent or buy. Fortunately, you don’t have to search alone. Working with a qualified real estate firm such as Adelson & Weiss, can dramatically improve your chances of finding suitable accommodation since real estate agents frequently receive information about units that are not available to the general public.
If you require assistance finding a place to rent or buy, give us a call today.