GTA Rental Supply Gap to Double in Next 10 Years

TORONTO – August 20, 2025:  A joint report authored by Urbanation, BILD, and Finnegan Marshall was released today that provides updated projections for rental housing demand and supply in the GTA. 

https://www.bildgta.ca/wp-content/uploads/2025/08/BILD-PBR-White-Paper-2025-Update-FINAL.pdf

The executive summary from Urbanation’s contribution to the study is provided below. 

• Outside of COVID-19, rental vacancy rates in the GTA reached their highest level in 15 years at 2.5% in 2024. This occurred as supply from purpose-built and condo rentals increased by the most in decades with the addition of nearly 35,000 units in 2024, more than doubling the 10-year average growth. With vacancy approaching a neutral level of 3%, rent growth became aligned with general inflation.

   

• Rental demand in the GTA grew by an historic amount in 2023 and 2024 due to an explosive increase in population, allowing the market to absorb the increase in rental supply. In the past two years, the GTA population increased by 550,000 persons, a level of growth normally experienced over a six-to-seven-year period. 

   

• Following changes to federal immigration policy targeting a lower intake of permanent residents and reduced number of non-permanent residents, population growth in the GTA has begun to slow, which has contributed to a mild decrease in rents this year as condo and purpose-built rental completions remain high. Population projections call for growth of 726,884 residents in the next 10 years, 38% less than the latest 10-year increase of 1,177,497. 

   

• Growth in rental supply is projected to slow substantially from its current pace in the post-2025 period, mainly due to a steep fall in condominium completions, which have represented most of the new rental supply in the GTA. Condo apartment construction starts dropped 50% in 2024 to a 25-year low of 8,792 units, while purpose-built rental construction starts increased 7% to 6,637 units, which was below the recent high of 7,061 starts in 2021.

   

• Using the latest population forecasts, and assuming a continuing decline in homeownership rates due to long-term structural affordability issues, rental demand in the GTA is projected to grow by 232,000 households during the next 10 years. Over the same period, the total supply of purpose-built and condominium rentals is expected to increase by 111,000 units, resulting in a projected supply deficit of 121,000 rental units. This adds to the supply deficit of 114,000 units accumulated between 2016 and 2024.

   

• With condo investors pulling back significantly, purpose-built rentals are expected to contribute most of the new rental supply in the next decade. However, to meet the goal of building at least an additional 100,000 rental units beyond what the market is already on track to deliver, purpose-built rental construction starts will need to increase to approximately 16,000-19,000 units per year. 

   

• There are currently more than 200,000 purpose-built rental units in the planning stages that have been held back from proceeding as they await approvals and for economic feasibility to improve. At year-end 2024, the GTA had the lowest number of per capita purpose-built rentals under construction among Canada’s six largest centres.