The average rent in Toronto just rose $228 in one month

Rising interest rates, unaffordable housing, and workers’ continued return to the office spurred a dramatic increase in the cost of rent in Toronto last month.

According to the August 2022 National Rent Report from Rentals.ca and Bullpen Research & Consulting, the average rent in Toronto hit $2,691 in July—an annual increase of 24%. In June, the average rent in the city was $2,463.

The average one-bedroom in the city now costs $2,257 per month, a 4% jump from June and an annual increase of 21.6%.

Rent for a two-bedroom reached $3,259 in July, a monthly increase of 7.8%, and an astonishing 25% rise from July 2021.

Toronto’s sky-high rents made it the fourth-most expensive city in Canada last month. Previously home to the second-highest rents in the country, Toronto’s drop in rank was not caused by stagnant prices, but rather is due to even more significant growth in other cities.

Vancouver once again topped the list of 35 cities, followed by North Vancouver and Richmond, respectively. In addition to Toronto, four other Ontario cities made the top 10.

“The two major factors impacting rental rates is the continued return to the office which has boosted rents in the most expensive central markets in Canada, and the recent increase in interest rates which reduces the affordability of ownership housing, and causes uncertainty for would-be buyers worried about future price declines,” the report reads.

The largest price increase across Ontario last month was seen in Hamilton — average rents rose 26% year-over-year to $2,097, up from $1,664 in July 2021.

Sizeable gains were seen in Kitchener, too: rents were up 25% annually in July to $2,108. London followed, with rents rising 24% annually — and 9% monthly — to $2,036.

At $2,232, Ontario had the second-highest average rent of any province in July. The figure, which is a 15.2% annual increase, pales, again, only to British Columbia’s $2,590.

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The average rent in Canada hit $1,934 in July, a 10.4% year-over-year increase, and a monthly rise of 2.6%.

The figure is now just $20 below the pre-pandemic peak of $1,954 seen in September 2019. At their lowest, rents had fallen to $1,675 — a 14.3% drop, seen in April 2021 — but have since jumped 15.5%.

“The 2.6% monthly increase in average rents in Canada is the second highest monthly jump in three years, topped only by the 3.8% rise in May 2022,” said Ben Myers, president of Bullpen Research & Consulting.

“Rents were boosted by rent growth of 20% and higher in several major municipalities in Canada, and double-digit growth in a number of the most affordable rental markets, such as Red Deer and Saskatoon.”

Rentals.ca and Bullpen Research & Consulting