Demand for rental condos hit new records across the GTA in the second quarter of 2014, but rents are holding steady, both because of increased supply and the shrinking size of units coming on the market.
That’s according to a second-quarter survey of the rental market for glass-and-granite towers by condo-market research firm Urbanation.
“A surge of new supply from recently registered buildings kept rents in check during the quarter. Although listings are expected to remain strong as more units complete construction, rental demand shows no signs of abating, which should keep rents steady,” says Shaun Hildebrand, senior vice president of Urbanation.
The number of condos for rent on MLS grew by 26 per cent in the quarter, year over year, to a record 6,708 units. But the growth of new investor-owned condos on the market outpaced that, climbing 29 per cent year over year by 29 per cent.
Meanwhile, the average unit size hit its own new record – a low of 755 square feet, down almost 4 per cent or 30 square feet from the second quarter of 2013.
That helped keep rents in check, with the monthly average rent falling almost the same amount – 3.2 per cent – to $1,787, said Urbanation.
During 2013, rents were climbing at an average rate of 4 per cent, and competition was so intense for units, especially close to the downtown core, that bidding wars were breaking out for some units.
Almost 6,000 condos were rented during the quarter, about 18 per cent of them through the MLS system, according to the research firm. The average rent for those units was about $1,521 or $2.37 per square foot.