When it comes to living in Toronto, is it better to buy or rent a condo?
Not surprisingly, the challenge of owning and finding a rental in Toronto’s condo market both continue to increase dramatically.
Currently, the average condo price in Toronto is at an all-time high of $603,480 (Q2 2018), which is up 6.5% from last year, while rental vacancy rates continue to be at a historic low below 1%, according to full-service real estate brokerage Zoocasa.
For those considering whether or not they should commit to buying a condo or continue renting, Zoocasa looked at how condo ownership versus rental affordability varies across the city and the results might surprise you.
The new report revealed that in 21 of the 35 City of Toronto neighbourhoods, the monthly cash outflow from paying a mortgage is lower than paying rent, so you may want to reconsider your current living situation.
To determine which neighbourhoods are cheaper to rent or own, Zoocasa compared the average monthly rent price based on data from the Toronto Real Estate Board’s Q2 2018 Condo Rental Market Report to the average condo price from the TREB’s Q2 2018 Condo Market Report.
According to the report, the monthly mortgage payment amount assumes a 20% down payment, 3.05% mortgage interest rate and a 25-year amortization. Keep in mind costs such as utilities, insurance, condo fees and property taxes were not factored in.
Neighbourhoods where paying a mortgage is less than paying rent:
- W05: Black Creek, York University Heights – buying saves $606/month (average rent: $1,939, average mortgage: $1,333)
- W09: Willowridge, Martingrove – buying saves $600/month (average rent: $2,107, average mortgage: $1,507)
- E10: West Hill, Centennial Scarborough – buying saves $576/month (average rent: $1,650, average mortgage: $1,074)
- W10: Rexdale-Kipling – buying saves $551/month (average rent: $1,834, average mortgage: $1,283)
- E11: Malvern, Rouge – buying saves $490/month (average rent: $1,751, average mortgage: $1,261)
Neighbourhoods where paying a mortgage and paying rent is about the same:
- C07: Willowdale West – buying saves $14/month (average rent: $2,341, average mortgage: $2,327)
- C14: Willowdale East – buying saves $12/month (average rent: $2,246, average mortgage: $2,234)
- C13: Don Mills, Victoria Village – buying saves $11/month (average rent: $2,064, average mortgage: $2,054)
- C15: Hillcrest Village, Bayview Village – buying saves $10/month (average rent: $2,011, average mortgage: $2,001)
- C01: Downtown – renting saves $51/month (average rent: $2,563, average mortgage: $2,614)