There are early signs that the rental market may be starting a comeback. In the first quarter of 2021, average condominium apartment rents were down on a year-over-year basis, however growth in rental transactions outstripped growth in the number of units listed over the same period, suggesting that rental market conditions are starting to tighten up once again.
In the GTA there were 13,168 reported condo rentals during the first quarter of this year. This represents an increase of 81% compared to 7,251 rentals in Q1 of 2020. The number of condos listed for rent during the first quarter of this year was up 78% compared to the same time last year. The number of condo apartment rentals reported in the first quarter represented a new record for the first three months of the year. This suggests we are accounting for pent-up rental demand from 2020. Strong rental demand is also an indicator of broader economic recovery with people willing to sign rental agreements because they are confident in their future job and income prospects.
The average one-bedroom condominium apartment rent was down by 16% year-over-year in Q1 2021 to $1,820 compared to $2,187 in Q1 2020. The average two-bedroom condominium apartment rent was down by 13% over the same period to $2,447 compared to $2,812.
“The rental market will continue to contend with COVID-19 as the third wave keeps the GTA in a lockdown during the second quarter. However, market dynamics were set in motion in the first quarter to generate strengthening rental conditions as the year progresses — particularly later in the second half as the population becomes vaccinated, offices start to reopen, immigration rises, and post-secondary students potentially return to in-class learning. These variables are obviously subject to change and dependent upon exogenous factors, but as each day passes and housing prices get more expensive, the upside for the rental market rises.” Shaun Hildebrand, Urbanation.
