Downtown condo rentals booming, as GTA records double-digit increases

 

 

 

 

 

 

 

 

The number of condo units leased across the GTA in 2014 was up 15 per cent from 2013 and up 11 per cent in the fourth quarter alone.

The love affair with downtown living shows no signs of easing as the number of condos renting through the MLS system hit a new record in 2014, according to condo research firm Urbanation.

Some 22,765 units were leased across the GTA throughout 2014, up 15 per cent from 2013 and up 11 per cent in the fourth quarter alone, most of them in the highly sought-after downtown core.

And that’s just the units rented via MLS. It doesn’t include others rented via online sites such as Kijiji and Craigslist or by word of mouth as a record number of units came to completion across the GTA last year.

The demand was enough to keep up with that record supply coming onstream throughout 2014, which was up 10 per cent in the fourth quarter alone, says Urbanation.

“The rental market’s proven stability and consistent growth is encouraging as we remain in a scenario of high condo completions over the next couple of years,” said Shaun Hildebrand in a statement, Urbanation’s senior vice president.

But there was both good and bad news for renters: Average rents were up just 1 per cent in the fourth quarter of 2014, over the same period a year ago, to $2.39 per cent foot. That was a significant decline in rent growth from the 4.1 per cent rate of rent growth recorded in 2013 and the 3.7 per cent increase in 2012, according to Urbanation’s research.

Overall, monthly rents were actually down in the fourth quarter, year over year, to $1,816, but that’s largely because of the bit of bad news for renters.

The average size of condo units being rented out continued to shrink. In 2014 they were down another 1.5 per cent, or about 12 square feet, to an average of 761 square feet over 2013.

Developers have come to recognize they have put too much focus on investors – buying units to rent out – rather than so-called end users who plan to live there. They have started selling bigger, two-bedroom plus units over the last year or so, but it will take time for those to be built and hit the market.

 

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