A look at rental rates in Mississauga over the course of the pandemic
While sales have dropped dramatically and prices have inched down month-over-month, tenants aren't seeing much of a change in rental rates in Mississauga, indicating that the city is something of an outlier.
The recently-released Toronto GTA May Rent Report by TorontoRentals.com and Bullpen Research & Consulting takes a closer look at the GTA market and the pockets of rental activity. According to the report, rental rates in Mississauga have stayed the same month-over-month but grown year-over-year—a trend not seen in Toronto and other GTA cities.
The report says condominium apartment rental rates declined in the GTA from 2019 to the first four months of this year, adding that Toronto rents declined 5 per cent both monthly and annually in April.
The report says part of the decline can be attributed to an increase in former short-term rentals (such as Airbnb units) hitting the long-term rental market, which added a major infusion of supply in a market already rocked by the pandemic.
In Mississauga, the average rent for all property types hit $2,269 in April 2020—$4 higher than rental rates in March ($2,265). April rates were actually higher than rates recorded in January when average prices hit $2,256.
Year-over-year, rental rates are actually up three per cent in Mississauga. Month-over-month, they're virtually unchanged. In April, Mississauga came in fifth out of 33 cities for average monthly rent for a one-bedroom at $1,927 and seventh for average monthly rent for a two-bedroom at $2,273.
The report says that rental demand has plummeted in nearby Toronto due to tenants staying in their current accommodations and the soaring unemployment rates that have accompanied the lockdown.
“Developments completed after November 2018 are not subject to rent control in Ontario, and investors in those buildings are more likely to decrease their asking rents short-term, knowing they can raise them to the market rate when the economy and real estate recovers,” said Matt Danison, CEO of TorontoRentals.com, in the report.
According to the report, the average monthly asking rent in the GTA peaked at $2,328 in August 2019, but was still up 1.3 per cent annually in April 2020.
Richmond Hill had the highest rent in April at $2,387 per month, followed by Toronto (pre-amalgamation boundaries) at $2,362 per month.
According to the report, many landlords have tried to entice tenants to make a move in this uncertain time by lowering their asking rent.
The report says the current situation could fundamentally alter the market by making future landlords wearier of investing in real estate.
“This pandemic could have a real impact on the supply of new housing in the GTA in the long term, as missed payments by tenants and lower rents could have many investors rethinking future pre-construction condo purchases," said Ben Myers, president of Bullpen Research & Consulting, the report.
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