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As of the last quarter of 2014, condo leases in Toronto rose 15% year over year to establish a new record, according to Toronto condominium market analyst Urbanation Inc. The number of condo suites rented through the Toronto Real Estate Board's MLS system during 2014 topped 2013 by growing another 15% to 22,765 units.
Fourth quarter volumes under-performed compared to the year as a whole, but still grew by 11%. Demand and supply growth were aligned during that quarter as condo rental transactions 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.
