In September, Toronto witnessed a decrease in asking rents to the lowest level for that month in five years, as per data from a report jointly compiled by real estate firms Rentals.ca and Urbanation. The average asking rental price for September stood at $2,554, marking a 1.4% year-over-year decline, extending the city’s streak of 32 consecutive months of annual drop in rent prices.
Despite the decline, Toronto remained the fourth most expensive major Canadian market for one and two-bedroom unit rentals, with an average rental price of $2,556 for those units. Other Greater Toronto Area (GTA) cities that featured in the top 20 priciest one and two-bedroom unit rentals in September included North York at an average rent of $2,528, Etobicoke at $2,431, Vaughan at $2,363, Mississauga at $2,337, and Brampton at $2,261.
Giacomo Ladas, communication director at Rentals.ca, suggested that the declining trend in asking rents may persist through the fall and winter months, following typical seasonal patterns. National figures from the report revealed an average asking price of $2,034 for rental units in Canada in September, reflecting a 4.2% decrease from a year ago, marking two consecutive years of annual declines in the Canadian rental market.
Statistics Canada data highlighted a 19.4% increase in average weekly earnings over the past five years, indicating an overall enhancement in rental affordability. John Pasalis, president of real estate firm Move-Smartley Realty, attributed the rent decline in Toronto to factors such as increased inventory and a stabilized population. He mentioned a surge in condo completions in the Toronto area over recent years, primarily acquired by investors for rental purposes, coupled with a decrease in permanent residents, shifting the market in favor of renters.
The report also pointed out signs of stability in the rental markets of Toronto and Vancouver, suggesting a potential return to positive rent growth in the near future. Factors supporting this anticipation include peaking construction inventory, revised population data showing modest growth, and reduced exposure to tariffs in the job markets of both cities.