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Blog > Toronto’s Rental Market in 2024
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Finding a safe, affordable place to rent in the GTA hasn’t been easy. There are several factors that have influenced the rising rental prices. As the demand for affordable and safe housing continues to outweigh supply, Torontonians have, and continue to struggle to find a place to call home. So, after three years of fluctuating housing and rental prices, what can potential renters expect for Toronto’s rental market in the new year?
During the COVID-19 pandemic, prices for quality rental places skyrocketed as a high demand real estate market and increased bidding wars priced many potential buyers out of the market. Since the lockdowns ended, housing prices have finally dropped to pre-pandemic levels, the demand for rental units has continued to climb. But is this over-stressed market going to continue in the New Year?
While the rental market is still going to be tight, the rental market forecast for 2024 is looking a little brighter than it has in previous years. One of the factors that has, and continues to influence the availability and price of rental properties is the real estate market. During the frenzied pandemic buying serge, many potential homeowners looked for places to rent when they were priced out of buying a home. However, now that the housing market is stabilizing and housing prices continue to drop, people who want to buy a house dropped to pre-pandemic levels.
Housing prices are expected to continue to drop in price in 2024 by as much as 3% to 5%, depending on the neighbourhood. This is good news for both home buyers and renters. As more people once again look for affordable homes to buy, less people will be looking for places to rent.
Another factor affecting Toronto’s housing market predictions for 2024 is a rental cap being placed on landlords and property developers. Next year, the Ontario government is implementing a 2.5% cap on rental increases so rent rates won’t increase so drastically like they have in previous years. This cap offers renters the reassurance knowing they won’t have to face escalating rent prices that could force them out of their existing lease.
Despite the threat of a recession and potential job loss, the Ontario economy has recovered better than other provinces since the pandemic shut downs. Ontario has the second strongest economy in the country. Many industries, like manufacturing, English media and independent business owners are thriving and adding jobs to the province.
As the economy continues to flourish during the turbulent national economic struggles, Torontonians can feel more secure and confident when it comes to making major life decisions like making a major purchase or moving into their own rental place.
One of the major causes of increased housing demands is the continued population growth, especially in the bigger cities like Toronto. High immigration is also influencing Toronto’s rental market forecast for 2024. The federal government wants to welcome 500,000 newcomers into the country every year in the foreseeable future. Toronto is one of the most popular cities for newcomers to move to when they arrive in Canada. As the population continues to grow, the demand for quality rental and real estate properties will continue to increase. This population growth will create periods of market imbalance as demand outweighs supply.
All levels of government know that housing is a top priority so we can expect to see more efforts put into finding solutions to add more homes and rental properties through the city. Toronto recently implemented a Vacant Home Tax to help ease the housing crisis. Monies collected from this tax will go towards different housing initiatives throughout the city. These initiatives will also help Toronto’s rental market next year as more properties are developed and rented out.
