Rental Prices Surging in Mississauga
It's no secret that living in Mississauga and surrounding cities is incredibly expensive.
While buyers got a tiny bit of relief after the winter 2017 market cooled (thanks in large part to the Ontario government's Fair Housing Plan and the more vigorous OSFI stress test), prices did not drop astronomically.
And since real estate remains a costly investment, renters looking for condos to lease are feeling the pinch—especially now.
Recently, Toronto Real Estate Board (TREB) President Tim Syrianos announced that average rents for one-bedroom and two-bedroom condominium apartment rental units were up well above the rate of inflation on a year-over-year basis in the first quarter of 2018.
How much did they climb?
TREB says the average rent for one-bedroom condominium apartments in the TREB market area was up 11.4 per cent on an annual basis, hitting a whopping $1,995.
The average two-bedroom condominium apartment rent was up by 9.1 per cent over the same time period, hitting a substantial $2,653.
Why are prices climbing? Simply put, the market is an attractive one, and therefore there's a lot of demand.
"The GTA continues to be one of the most desirable locations to live in the world and will remain so over the long term," says Syrianos.
"As people have moved to the region to take advantage of quality employment opportunities, rental demand has remained strong. The result has been heightened competition between renters, in an ultra-low vacancy environment, and double-digit rent growth in some market segments."
Demand also outpaces supply.
TREB says the number of condominium apartments listed during the first quarter was down 11.8 per cent compared to the first quarter of 2017. The total number of units leased was down 7.5 per cent.
With a vacancy rate hovering at one percent for condominium apartments (in Mississauga alone, the rental vacancy rate is a troubling 0.9 per cent), there has been less supply available to would-be renters, which has resulted in fewer lease agreements being signed.
"The low-vacancy, high rent growth situation that has unfolded in the GTA over the past year will be further exacerbated by the rent control provisions contained in the Fair Housing Plan," says Jason Mercer, TREB's director of market analysis.
"Some investors who, previously would have considered investing in rental units may now look elsewhere for returns on their money. This does not bode well for a sustained increase in rental supply over the long term."