Toronto condo rent hikes may slow in 2019 with more condo units available for rent in 2019

“It isn’t a coincidence that rents and (home) prices tend to move in the same direction,” Hildebrand said.

While new purpose-built and condo rental supplies should slow the rate of rent growth, it may not be enough to push down prices, Hildebrand said.

Urbanation’s report showed monthly condo rent rose 7.6 per cent year over year in the third quarter to $2,385 on average from $2,216. Those are condos leased through the Multiple Listings Service (MLS).

On a square foot basis, condo rents were up 9.4 per cent year over year to an average of $3.26 per sq. ft.

In purpose-built rental apartments constructed since 2005, the average square foot rent cost was $3.09, a 17 per cent increase compared to the same quarter last year.

Purpose-built rentals tend to be larger than condos — 804 sq. ft. on average, compared to the average condo in the GTA which was 638 sq. ft.

“We’re now seeing that rents have been rising by close to double digits for more than two years now. It’s creating a really tough situation where a lot of demand is starting to shift into really small units,” he said.

“The average rent for even a studio is now above $1,800 a month. The volume of units that are leasing for below $1,800 a month has basically dropped off almost completely — a 65 per cent decline year over year,’’ said Hildebrand.

There was a 32 per cent jump in the number of studio apartment rentals year over year and the price of those units rose 9 per cent to $1,823 on average in the same period. Meantime, the number of condos that rented for $2,500 per month or more rose 43 per cent.