Five
years ago, it was impossible to get a rental apartment or condominium in
Toronto. Often, you had to give
the existing tenant anywhere from $2,000 to $5,000 in key money just to secure a
Lease. Have things ever changed!
During
late 1999 and early 2000, landlords were asking, and getting, $1,550 and
$1,800
for well located but older one and two-bedroom apartments. The same apartments
are today are being offered for $1,100 and $1,450 respectively, and they are not
easy to rent. There are three factors, which created this huge market change.
The single most significant has been the tremendous condominium construction
boom, which has taken place over the past three years, vastly increasing the
supply of housing within Toronto. But the real changes are just beginning to
be felt. Most of the unit sales,
which took place over the past three years, are now being finished and ready
for occupancy. 60% of these units
are still under construction and will not reach the market for least another
year. This “under
construction” inventory will affect the market even more, substantially
increasing residential vacancy rates and lowering rents even further.
The
second factor, which has affected the rental market, has been the removal of
rent control. When rent control
was in place tenants thought they were being offered apartments below market
and when an apartment became available, they would grab it quickly so as not
to lose it. When rent control was rescinded, landlords asked what they thought
was “Market Rent” and in many cases these rents were more than what it
would cost to carry a new a condominium.
Tenants, in turn, bought new condominiums and as these buildings are
being finished, landlords are getting notices from these tenants. In many
cases, this market change has caught landlords completely by surprise.
The
third major factor is the overall employment changes within the city.
More jobs have been created, no doubt, but most of these new jobs are
lower paying part-time jobs. Incomes
in Toronto’s most important sectors including brokerage and financial,
technology and tourism are down. Just
as the brokerage sector and technology sector have suffered over the past two
years, so too has overall pay scales within these industries suffered.
A
lot of people don’t realize how March has changed.
Renter’s News has nearly doubled in size to about 400 pages. (broken
down into 322 Numbered pages plus another 75 pages of supplements.)
Nearly every rental building has (posted) vacancies and rental offices
are now open on weekends. Landlords
are doing a better job of staying in touch with tenants, responding faster to
work requests and even going as far as to having Tenant appreciation parties.
New
tenants are being offered special incentives like free parking, the waving of
the last month security deposit, and even periods of free rent – tactics
similar to those used to rent office space.
Tenants
can expect to get better apartments for their money including Newer centrally
air-conditioned units with dishwashers, washers and dryers along with
concierge and recreational facilities. One
and two-bedroom apartment with these amenities can rent from $1,200 to
$1,550
dollar respectively and without these amenities from $900 to $1,250 dollar
respectively.
Back
to “Toronto Apartment Rentals” Information
E-Mail Us your comments