Condo leases increase 15% in 2014 to an all-time high while rents continue to hold steady amidst rising supply
TORONTO – January 12, 2015: Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its fourth quarter and annual rental market results for 2014 today.
The number of condo apartments rented through the MLS system during 2014 in the Greater Toronto Area managed to top 2013’s breakout year by growing 15% to 22,765 units. Fourth quarter volumes grew by 11%, affirming a relatively slower rate of growth for the market in the second half of the year.
Demand and supply growth were aligned during the fourth quarter as condo rental transactions grew at a similar pace to listings, which increased 10% year-over-year and held the ratio of leases-to-listings to a level consistent with previous fourth quarters at 66%. Supply growth has seen some reprieve over the past six months as the number of new project registrations has scaled back.
Average condo apartment rents grew by 1.0% year-over-year in Q4 to end 2014 at $2.39 per sq. ft. For the year as a whole, condo rents appreciated by an average of 0.8%, a marked deceleration from the 4.1% rate of growth recorded in 2013 and the 3.7% increase in 2012. The absolute average monthly rent continued its downward trend on account of shrinking unit sizes, declining by 0.7% annually in the fourth quarter to $1,816 — the fifth consecutive quarter of year-over-year declines. Over the past year, the average size of units rented has fallen by 1.5%, or 12 sf to an average of 761 sf in Q4-2014.
“The condo rental market grew into its shoes in 2014. Demand proved strong enough to absorb the market’s greatest amount of new supply in history, while also revealing an equilibrium for rent levels. The rental market’s proven stability and consistent growth is encouraging as we remain in a scenario of high condo completions over the next couple years,” said Shaun Hildebrand, Urbanation’s Senior Vice President.