No matter if you’re buying a home or renting a place to stay, Toronto and its surrounding GTA neighbourhoods are infamous for being very expensive locations to live in. That said, these past 16 months have caused a shift in both the prices of homes and rental rates.
As most probably know already, homes are nearly impossible to buy for a reasonable price anywhere around the GTA, especially for new buyers. However, where the prices of homes have increased, the rental market has seen quite the opposite effect. So much so that in Q1 of 2021, Vancouver actually passed Toronto in becoming the most expensive place to rent in Canada. So in order to better understand this decrease in price rates for rental properties in the city, the availability of rentals, changes in price rates around the GTA and potential scams should be discussed in more depth.
Availability in the City
The availability of rental properties has a direct correlation to their price rates. Obviously, if there are more individuals who are in the market for renting a place to stay, then the price rates of rental properties can comfortably increase since there’s more demand than supply. However, this has been the opposite for Toronto. Since jobs were lost and hours were cut throughout the previous lockdowns, there were fewer and fewer people looking to rent in the city. So in order to compensate, rental prices decreased substantially.
However, although rental prices are still technically decreasing, availability might soon be back to its regular scarcity since vaccinations are climbing and restrictions are easing. For example, these two factors have allowed colleges and universities around the GTA to almost fully reopen in anticipation of the 2021-2022 school year. Naturally, students need a place to rent throughout their semesters. This is even true to the extent that searches on rental websites have increased in the past few months. So, it’s safe to say that if Ontario continues to reopen on schedule and without another lockdown, availability in the city may decrease and lead to a rise in price rates.
Price Rates Around Toronto and the GTA
According to a recent liv.rent report, Toronto’s rental price rates saw a 14% drop for furnished units, and a 12% drop for unfurnished units from 2020 to 2021. An average furnished unit in the city demanded a rate of $2,429 in 2020, versus $2,216 in 2021.
From Q1 2021 to Q2 2021, there was only a drop of 8.8% and 7.4% respectively. So, rates are still on the decline, but that decline is slowing down compared to previous quarters.
That said, when looking at the GTA as a whole, almost every city has experienced a similar trend with the exception of one. Toronto, Brampton, Vaughan and Mississauga have experienced a decline in rates in the first half of 2021. The one exception was Markham, where rental rates have actually increased 0.2%-0.4% for units in the area.
Be Aware of Scammers
Here’s the unfortunate catch. Since rental rates have decreased significantly, the amount of scammers has increased alongside it. Essentially, scammers can more easily convince potential renters to send a down payment or their credit card information in order to “take advantage of the great prices being offered”.
Now more than ever, scammers have a somewhat legitimate excuse as to why their “listing” seems so good, as well as why you need to pay them as quickly as possible before their “listing” gets “signed”.
So, if a deal seems too good to be true, payment needs to be sent way too far in advance, or a listing just doesn’t seem right, take a deeper look into the details of the rental property that you’re exploring.
Featured Image: Marcos Paulo Prado