Q3 2024 GTA Rental Market: More Choices and Lower Rents

Hi Evolvers,

Welcome to your Q3 2024 Rental Market Update!

The Greater Toronto Area (GTA) rental market continues to experience significant changes, fueled by robust population growth and shifting dynamics. Here’s what you need to know:

Strong Growth in Rental Transactions

The third quarter of 2024 saw a remarkable 29.2% year-over-year increase in condo apartment rental transactions, with 18,540 rentals reported through TRREB’s MLS® System. This growth is largely driven by newcomers to the GTA, who often opt to rent before transitioning to homeownership.

As TRREB President Jennifer Pearce explains:

“Many newcomers to the GTA initially choose to rent a home. Given the record pace of immigration, it is no surprise that the number of rental transactions continues to trend upwards. In recent months, these renters are benefitting from much more negotiating power, due to an increase in listing supply. This has resulted in a more affordable rental market.”

Increased Supply and More Choice for Renters

The number of condo rental listings rose even faster than transactions, with a 46.6% year-over-year increase. This surge in supply has provided renters with greater choice and negotiating power, resulting in a dip in average rents.

• Average one-bedroom rents: $2,499 – down 5% compared to Q3 2023.

• Average two-bedroom rents: $3,216 – down 5.6% year-over-year.

A Balanced Market and Improved Affordability

The increased inventory has led to a more balanced market, providing welcome relief for renters. According to TRREB Chief Market Analyst Jason Mercer:

“A more balanced GTA rental market has no doubt led to an improvement in affordability over the past year. Interest rates have trended lower this year, with more Bank of Canada cuts yet to come. More affordable mortgage payments could prompt some renters to move into homeownership. This could lead to a further increase in rental inventory in the months ahead.”

What’s Next for Renters and Investors?

Lower interest rates and an improving rental market could shift some renters into homeownership, further boosting rental inventory in the near future. This evolving market dynamic presents opportunities for both renters and real estate investors alike.

Stay tuned for more updates, and as always, feel free to reach out if you have any questions about navigating the GTA rental market.

Until next time, keep evolving!