Toronto apartment hunters have a lot more options these days, as a flight into the suburbs led to an all-time high vacancy rate.
Urbanation looked at purpose-built rental apartments completed in the City of Toronto since 2005 and found the vacancy rate hit 5.7 per cent in the fourth quarter of 2020, compared to 1.1 per cent in Q4 2019. That’s the highest it’s ever been, in historical data from Canada Mortgage and Housing Corporation (CMHC) going back to 1971.
The COVID-19-induced urban exodus helped keep the 905 area code regions of the Greater Toronto Area (GTA), where rental supply is relatively limited, more stable. The vacancy rate there was up from 0.8 per cent in Q4 2019 to a still low 2 per cent, Urbanation says
The overall vacancy rate for the GTA rose from 1 per cent in Q4 2019 to 4.6 per cent in Q4 2020.
How much rents have fallen
The elevated vacancy in the City of Toronto is reflected in average rents, which were down 10 per cent to $2,337 for units listed in Q4 2020 compared to Q4 2019. The 905 saw a milder drop of 2.2 per cent to $2,139.
A similar trend played out in the condo market in 2020, which saw a 162 per cent annual increase in year-end active listings to a record high 8,066 units. City of Toronto condo apartment average rents were down 17.2 per cent year-over-year in Q4, compared to 4.9 per cent in the 905.
“The GTA rental market faced its toughest challenges to date in 2020 due to COVID-19,” said Urbanation president Shaun Hildebrand in the report.
“While rents have a long way to go before returning to their peak and supply will continue to be a headwind in the near-term, some improvement can be expected in 2021 as vaccinations eventually lead to higher immigration and at least a partial return to the office for downtown workers and in-class learning for post-secondary students.”
Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.