Rising rents are causing worry and concern among Toronto tenants

Latest data shows the average rent of one bedroom in Toronto increased by 21.5% in March compared to 2022

Yukun Liu is facing the challenge of rising rents while he attends university as an international student. (Yuyang Huang/Toronto Observer)
Yukun Liu is facing the challenge of rising rents while he attends university as an international student. (Yuyang Huang/Toronto Observer) 

Yukun Liu returns to his apartment building near Scarborough Town Centre weighed down with heavy Walmart bags. Juggling his load, he presses the button and gets in the elevator. He then takes out the key and opens the door of his two-bedroom apartment. 

Liu used to share his unit with one other university student. But these days, as costs increase, he’s got two roommates, who are also students, share the room next to his.

“The rental price increase can affect our life, especially for us,” Liu told the Toronto Observer. “We need to save more money to pay the rent.”

The average rent for a one-bedroom apartment in Toronto reached $2,501 in March, according to realtor.ca. That’s about 21.5 per cent higher than that in 2022. As international students and immigrants continue to arrive in Toronto, the rising rents could be bad news for them.

Watch a video about how rising rents are affecting students:

He has no idea but to keep hoping

Liu is a third-year international student at the University of Toronto Scarborough. After taking online courses in Nanjing, China, under the pressure of a 12-hour time difference for a year, he moved to Canada during his summer vacation.

In 2021, Liu chose to rent an apartment with his classmate, Eason Tian, about 14 minutes’ walk to the shopping centre. To make transportation more convenient, Liu has now moved to a new apartment that is four minutes’ walk to the mall; he’s been living there for nine months.

Yukun Liu walks back to his rental unit, which he shares with two other students. (Yuyang Huang/Toronto Observer)

Although the two apartments are only less than 2.5 kilometres apart, the rent for the new apartment has gone up from $2,950 to $3,420, or nearly 16 per cent. The cost is a significant burden for the two students.

“The overall rental price is more expensive than the previous place I lived,” said Liu, whose parents help pay his expenses. In order not to worry them, Liu and his roommate cut back on unnecessary expenses and brought in a new roommate. That’s how they ended up putting two single beds in one room.

Although Liu’s living expenses are currently stable, he still hopes the rent can be reduced in the future as he is unsure whether the landlord is willing to rent this apartment to them for another year when their agreement for this year ends.

Why rents keep rising

Toronto’s rents are influenced by a number of factors — all of which are working together to push them up.

“One of the first things is interest rates,” said Joey Zhou, a realtor who works for Royal LePage Golden Ridge Realty. 

Bank of Canada announced that the policy interest rate reached 4.25 per cent in December, 2022. According to a report by Liv, a rental platform, as interest rates rise, Canadian landlords will likely feel the impact. Many landlords need to charge their tenants more in order to break even on their property investments.

“The supply doesn’t match the demand, so people have no choice but to find a place to live,” said Cassie Wang, a Dream Home Realty Inc. sales representative and a marketing specialist.

As a realtor in Toronto, Wang often has the opportunity to handle the rental requirements of international students. “I can see they are struggling with red eyes and I am frustrated.”

Read more from the Toronto Observer:

Toronto receives a large influx of immigrants and international students every year. According to the data from Statista, the number of immigrants increased to 159,679 in 2021/22 compared to 78,849 in 2020/21. As a result, the pressure on existing rentable accommodations has greatly increased.

With demand for housing outpacing supply, people often make higher bids than others to secure rental units, pushing prices up. This is the second reason why rents are rising.

The third reason that Zhou mentioned is that people moved back to their original homes as the COVID-19 pandemic subsided. During the pandemic, many people chose to leave urban cores for many reasons, such as to find cheaper rent outside of big cities, or to avoid crowds where the virus could be transmitted, or because they were able to work remotely.

“Then what happened was people feel now it’s time to go back,” said Zhou.

At the height of the pandemic in 2021, the average rent of one-bedroom condos in downtown dropped to $1,700 per month. That was much cheaper than the current average monthly rent of $2,501, according to realtor.ca. The supply of one-bedroom condos in the market decreased, and the rent increased.

What can we do

“Basically, tenants have to start planning to live further, away from the core to get some relief in terms of rent prices,” said Zhou. He also believes that one-bedroom tenants who are currently struggling with high rents should start thinking about switching to two-bedroom or three-bedroom places and finding roommates willing to share costs.

Douglas Kwan, director of Advocacy Centre for Tenants Ontario (ACTO), an advocacy group that helps low-income tenants in Ontario, said tenants need to work together to help solve problems.

“If you’re experiencing that problem, chances are your neighbors are experiencing it as well,” he said.

Low-income immigrants and tenants can try to enlist the help of tenant groups and housing advocacy groups. In addition to actual subsidies and support, they also need to educate themselves on their rights.

“There is always strength in numbers,” said Kwan.

“Housing does not get built or fixed in a couple of years. It takes a generation.”

Affordable housing, as an increasing issue for many people in Toronto, could play a pivotal role in the mayor’s race. Josh Matlow, a candidate running to be Toronto’s next mayor, is one of those making promises on the issue. On his Twitter account, he promised to “deliver truly affordable housing” as mayor.

“All levels of government have a role to play in making sure that affordable housing is available for Toronto residents,” said Kwan.

Back in Scarborough, Liu is hopeful that a change in Toronto’s leadership might help his situation in the long run. He still has another year of school in Toronto next year.

“I may find one more roommate if the rent still keeps rising,” said Liu.

About this article

Posted: Apr 17 2023 7:49 pm
Filed under: Homes and Real Estate News