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With 12,367 units under construction across the Greater Toronto Area as of the end of 2019, the city is on the cusp of a potential rental renaissance.
Toronto-based real estate consultancy, Urbanation, which tracks rental construction across the region, published this data today as part of its quarterly rental survey.
In the survey, the consultancy noted that this level of rental development hasn’t been observed in the city since the 1970s. In similarly encouraging news for its beleaguered rental market, Toronto also saw a massive 43 percent spike in rental apartment development approvals submitted in 2019 and a total of 57,197 rental units proposed for development by the end of the year, the highest level tracked by Urbanation in the last five years.
Urbanation wrote that the significant spike in rental unit proposals can be linked to the November 2018 removal of rent control restrictions for new units in the province by the Ford government.
Toronto was singled out last year as the city with “the worst rental supply deficit in Canada” so the news of this nascent rental construction boom will likely be met with both cheers and calls for more to be done.
“[A]s anyone searching for a rental unit knows, there are too few available, and they’re getting more expensive,” wrote RBC economist Robert Hogue in a grave fall 2019 report titled “Big city rental blues: a look at Canada’s rental housing deficit.”
In the RBC report, Hogue said that demand for rental units in Toronto will continue to grow and accelerate thanks to strong migration into the city and its suburbs, coupled with stubbornly high home ownership costs that show no signs of declining.
While Hogue took a pessimistic view in his five-year outlook for the Toronto rental market, Urbanation President Shaun Hildebrand took a decidedly more optimistic tone in the survey.
“2019 may be remembered as an important year in the history of the GTA rental market, as the progress made towards increasing supply could mark the beginning of a new era for rental housing development in the region,” said Hildebrand.
“But it’s critical that this momentum continues in the years to come in order to eventually bring the market into balance.”
