GTA average monthly rents rise 21% in August over last year

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Millicent Wong
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GTA average monthly rents rise 21% in August over last year

Average monthly rents in the greater Toronto area increased 21 percent year over year in August, according to the latest rental report from Rentals.ca and Bullpen Research & Consulting.

Rents for all property types rose $430 to $2,528 from $2,098 in August 2021, further surpassing the pre-pandemic 2019 high of $2,461. The average is also now 28.2 percent above the COVID low of $1,972 per month set last April.

August rents are also up 2.7 percent month-on-month since July. Rental rates in the GTA have now risen by 2 percent or more for the past four straight months after rising 5.7 percent in May, which was a multi-year high.

Rent inflation is largely due to the rising interest rate environment, “which has made home ownership more expensive and prompted a rapid fall in prices in the resale market,” the report said.

With the Bank of Canada expected to hike interest rates further, demand for rental properties could continue.

In the Toronto market, residential rents rose 20.1 percent. The area with the highest average of all property types was the Bay Street Corridor at $2,779.

In the third quarter to date, average rents have increased in Toronto 13.8 percent ahead of the second quarter North York (10.1 percent), Scarborough (9.4 percent), Etobicoke (5.7 percent), and Mississauga (5.1 percent).

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“From May through August, the metro Toronto area rental market saw four significant monthly rent increases as tenant demand surged due to interest rate changes, a price correction for resale homes and the typical fall seasonal surge,” said Ben Myers, president of Bullpen.

He also noted that listings on TorontoRentals.com hit a multi-year high in August, doubling over the past year and up 166 percent over August 2020.

“Prospective tenants are seeing limited vacancies due to an extreme supply-demand imbalance, with new home completions in the metro area falling 22 percent per CMHC year-to-date,” he said.

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