With Toronto currently on track to outpace Chicago with the number of skyscrapers in the sky, it comes as no surprise that Canada's largest city is currently in the midst of a 50-year rental unit construction high.
As reported by the condominium and apartment market analysis firm, Urbanation Inc., at the end of 2019, the number of purpose-built rentals under construction in the Greater Toronto Area (GTA) reached 12,367 units, the highest level since the 1970s.
The report, which was released Friday, said that while the number of rental units that began construction last year declined to 4,172 units from the 25-year high of 5,620 in 2018, the number of units that were completed grew to 3,630, the highest level since the early 1990s.
Furthermore, a total of 17,082 new purpose-built rental apartment units were also submitted for development approvals during 2019 in the GTA, rising 43% from the 11,939 units that were submitted the year before. This spike in growth followed the removal of rent controls for newly built units in Ontario that was introduced in November 2018, according to the report.
At the end of 2019, a total of 57,197 new purpose-built rentals were proposed for development but had not yet started construction, rising from 44,086 units at the end of 2018 and reaching the highest level tracked by Urbanation over the last five years.
Combined, the total number of new rentals in the GTA that were either under construction or proposed for development reached 69,564 units, which was 4.5 times more than the total number of rentals built in the GTA since 2005 (15,305 units).
“2019 may be remembered as an important year in the history of the GTA rental market, as the progress made towards increasing supply could mark the beginning of a new era for rental housing development in the region," said Shaun Hildebrand, President of Urbanation in a statement.
"But it’s critical that this momentum continues in the years to come in order to eventually bring the market into balance.”
This data follows a report from Canada Mortgage and Housing Corporation earlier this week that revealed the national vacancy rate for purpose-built rental apartments declined for the third consecutive year, hitting a 17-year low of 2.2% in 2019.
“The national vacancy rate for purpose-built rental apartments declined for a third consecutive year in 2019, as strong rental demand continued to outpace growth in supply,” said Bob Dugan, CMHC's chief economist.
“Low vacancy rates in major centres underscore the need for increased rental supply to ensure access to affordable housing.”