If you want to know about the current stature of renting in Toronto, then you are in for a ride. The cost of renting in the city has undoubtedly hit the roof. What does that say about home buyers?
Let's sketch it out.
Quick Market Snapshot for Toronto (2025)
📈 Current 1BR Median Rent: $2,452 (+3.1% YoY)
🏗️ New Units Under Construction: 11,172
🔑 Average Days on Market: 14
💰 Average Price per Square Foot: $4.50
Key Insights
- The median rent for a one-bedroom condo has increased slightly, indicating a stable demand in the rental market despite overall rental rates showing some fluctuations.
- The number of new units under construction remains robust, reflecting ongoing efforts to meet housing demand in the city.
- The average days on market for condos has remained consistent at 14 days, suggesting a competitive market where properties are selling relatively quickly.
- The average price per square foot has seen a slight increase to $4.50, highlighting the continued growth in property values.
1. The Rise of Condo Rental Demand
One of the major concerns right now is the lack of housing supply and the shrinking affordability gap between condos and single-family homes. For many would-be buyers, the current market simply does not offer a realistic path to ownership.
Now that municipal and provincial elections are behind us, all eyes are on policymakers to step up and support housing development at scale. Precondo’s market analysts have pointed out that meaningful change requires not just zoning reform, but also streamlined approvals and more transparency around developer obligations.
The housing market's ridiculous stance is also another element to blame. People with an average income cannot even think of owning a home of over $800,000 in the city.
While the market is pushing people away from owning homes, the rental demand is apparently on the rise. The high home prices along with new government regulations have put a bar on many homebuyers, hence pushing them to try out the rental market [1].
"Due to a high demand and lack of supply for condos in the city, the % growth in rent in Toronto is among the fastest growing in the world."
- Greg Divine, McIntosh Perry
2. Booming Economy = More Expensive State of Living
Owing to the booming tech industry in the city, the condo market is ensured to burn the budget of homebuyers.
Ventures like Google City and a new hub for Microsoft are attracting many job-seeking crowds. With the tech industry's steady climbing rate, there's a lot of competition in the market.
Additionally, let's not forget that Toronto is ranked number two in the whole of North America in terms of tech and number four globally. With the ever-growing market in the tech sector, more and better jobs are also up for grabs.
This necessarily leads to a spike in demand for housing as well, but the supply sector is lagging behind. With the increase in the rate of influx of people looking for jobs, there's a noticeable increase in demand for housing options.
While this is undoubtedly an excellent time for the city to prosper, it questions the disparity between the supply and demand rate of housing. With the Toronto condo valuations on the surge, it’s a dire situation for investors and homebuyers.
The trend of living in a safe and wholesome suburb is long gone. In big cities like Toronto, homebuyers yearn for the lifestyle and accommodation offered by condos instead.
3. Uncontrolled Expansion of Urban Areas
Mostly, to balance the supply and demand rate in the city, there's a need to deal with affordability, environmental issues, and even the infrastructure. This will involve resolving the rising rate of urban sprawl with the increasing densification in the city.
As a calming relief, the increasing number of condos in Toronto is certainly good news. The number of new condo developments is expected to increase in the coming year. In order to meet the overall demand, the rental constructions are essential.
4. Non-Stop Population Growth
Toronto remains a major immigrant destination, contributing to its status as one of the fastest-growing cities in North America.
In 2024, the city recorded a population growth rate that continues to outpace previous decades, driven largely by millennials seeking urban living.
The demand for condos is increasing as more residents appreciate the lifestyle benefits of city living. As of Q2 2024, condo apartment sales amounted to 5,474, down 19.8% from 6,824 in Q2 2023.
However, new listings surged by 36.5%, reaching 16,917, indicating a growing inventory amid high demand.
Average condo prices have remained relatively stable, with the average selling price at $729,005, a slight decrease of 1.2% year-over-year.
In the City of Toronto specifically, the average price was $765,963, down by 0.5% compared to last year [2].
Key Market Indicators
| Metric | 2023 | 2024 | Change |
|---|---|---|---|
| 1BR Median Rent | $2,220 | $2,324 | +4.7% |
| Available Units | 2,854 | 1,987 | -30.4% |
| Vacancy Rate | 3.2% | 1.8% | -1.4% |
Updates and Insights
- 1BR Median Rent: As of February 2024, the average rent for a one-bedroom unit in Toronto is approximately $2,324, reflecting a year-over-year increase of about $176 since February 2023.
- Available Units: The number of available rental units has decreased significantly, indicating a tighter rental market.
- Vacancy Rate: The vacancy rate has dropped to 1.8%, suggesting strong demand for rental properties in Toronto.
FAQs
What is the average rent for condos in Toronto?
As of early 2024, the average rent for a one-bedroom condo in Toronto is approximately $2,452, while a two-bedroom unit averages around $3,178. These figures can vary based on the neighborhood and specific amenities offered.
How do condo rentals differ from traditional apartment rentals?
Condo rentals often come with additional amenities such as gyms, pools, and concierge services. However, they may also have specific rules governed by the condominium corporation that tenants must follow.
Are utilities included in the average rent of condo rentals?
Utilities can vary by unit. Some condos include heat and water in the rent, while others may require tenants to pay for hydro (electricity) separately. Always check with the landlord or property management for specifics.
The Best Time to Buy a Condo in Toronto is...
If you’re looking for condos to buy in Toronto, NOW is the best time because the prices will keep rising with time and new condo developments are coming up at a fast pace.
If you want to improve your chances of obtaining it, it’s best to get in the market right now with great deals on condos.
Explore the many new condo projects in the city and benefit from the pricing before it spikes.
A word of advice from us here at Precondo: Remember that it is better to buy than rent, so you can call this investment your own.
Now is the perfect time to carve a slice out of the magnificent skyline of Toronto.
References:
1. https://www.bloomberg.com/news/articles/2018-10-11/toronto-condo-rents-hit-new-record-as-supply-remains-crunched
2. https://trreb.ca/market-data/condo-market-report/
