The average rent for a home in Toronto rose nearly 23 per cent last month compared to a year ago, according to a new report.
The National Rent Report, by Rentals.ca and Urbanation, says the average monthly rent for all property types in Toronto hit a whopping $2,775 in Dec. 2022.
Toronto continues to have the second-highest average rent among all Canadian cities. Vancouver topped the list with an average rent of $3,080 last month.
The average rent for a one-bedroom apartment in Toronto was $2,457 in Dec. 2022, and the average for a two-bedroom was $3,215.
However, the month-over-month average rent for a one-bedroom decreased in Toronto last month by three per cent, and was down 3.9 per cent for a two-bedroom.
In Ontario, the report notes the province posted above-average population growth and rent growth last year, with December rents up 15.5 per cent year-over-year to $2,358.
As for the whole country, average rents exceeded $2,000 for a second straight month in December. Rental prices for all property types in Canada rose 12.2 per cent annually to $2,005, an increase of $217 from Dec. 2021.
On a month-over-month basis, average rents in Canada fell one per cent in Dec. 2022, which the report notes is a typical seasonal occurrence.
“The Canadian rental market had one of its strongest years ever in 2022, more than reversing any weakness experienced during the pandemic,” Shaun Hildebrand, president of Urbanation, said in the report. “Rental demand is primarily being driven by a quickly growing population that is finding it increasingly more difficult to afford homeownership or find suitable rental housing.”
The report says the double-digit growth in rents could be attributed to a variety of factors, including a recovery from declines experienced during the pandemic, a large pullback in home buying and low vacancy rates.
But will rental prices continue to escalate this year?
Well, the report predicts average rents in Canada will rise about five per cent in 2023, in line with “current rates of income growth and the long-term historical average for rent inflation.”