Greater Toronto Area REALTORS® reported an 18 per cent year-over-year increase in condominium apartment rental transactions in the fourth quarter of 2013, with a total of 4,305 condo apartments leased compared to 3,644 during the last three months of 2012. Over the same period, the number of condominium apartments listed for rent was up by 31 per cent.
“The construction of purpose-built rental properties has been a tough sell over the past decade. This means that investor-owned condominium apartments have increasingly filled the void in terms of meeting the needs of renters. People looking to rent modern apartments in popular neighbourhoods close to work and leisure opportunities have been focused on rental condos. Investor-owners have moved to meet this demand by listing their units for rent in greater numbers,” said Toronto Real Estate Board President Dianne Usher.
The majority of condominium apartment rental transactions – approximately 95 per cent – involved one-bedroom and two-bedroom apartments. Rent growth for these unit types was mixed. The average one-bedroom rent was down by 1.6 per cent year-over-year to $1,600, whereas the average two- bedroom rent was up by 3.7 per cent to $2,165.
“Condominium apartment completions were up in the GTA in 2013. Some of these newly completed units are owned by investors with a longer term outlook. Many of these individuals will have listed their apartments for rent. In all likelihood we will continue to see an increase in the number of apartments listed for rent in 2014. The degree to which the increase in listings is balanced out by an increase in demand will dictate the pace of average rent growth over the next 12 months," said Jason Mercer, the Toronto Real Estate Board's Senior Manager of Market Analysis.
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