Condo rent in the GTA reports the fastest growth pace on record

The latest report by Urbanation Inc. shows that condo rental prices rose at a record pace in the Greater Toronto Area in Q2 2022, following a significant decline in the market supply.

According to Urbanation, the average rental price per square foot was up by 5.9% from the first quarter, reaching a record high of $2,533. In addition to it, the annual rental growth also hit a record at 16.7%.

The drop in condo inventory appears at a time when certain buyers are forced to leave the real estate market because of the growing interest rates. Urbanation also pointed to strong population growth and almost record-low unemployment in the GTA as other reasons for the rental demand increase.

“Entering this summer, the GTA rental market was as strong as ever, which will definitely increase downward pressure toward vacancies and upward pressure on rents,” – says Shaun Hildebrand, president of Urbanation.

Urbanation says tenants were looking for smaller and more affordable condo units – this sector showed stronger rental gains than larger spaces. As a result, the overall vacancy rate in the GTA went down from 5.1% to 1.4% in a year.

Rental supply is expected to stay that tight as new rental construction almost entirely stopped in Q2. Now, there are only 87 rental starts left, while there were about 1,916 starts during the first quarter.