WEEKLY UPDATES


YOUR MARKET UPDATE FOR THE WEEK ENDING:  January 21st, 2022 
 

Doug Ford dropped rent control on new units in 2018. Since then, thousands have come online and tenants facing double-digit increases ask: was it worth it?

In 2018, the Ontario government introduced legislation that scrapped rent control on new builds. So, if you move into an apartment, a condo unit, or a basement unit that was first occupied as a residential space after November 15, 2018, there will be no legal limit set on how much your landlord will be able to raise your rent. In other words, the rent for the brand-new basement apartment unit that you’ll be moving into next month (the one you chose to rent because it is more affordable than apartments or condos) could become unaffordable for you in a year if your landlord wishes to raise your rent to make more profit. People in Toronto and other unaffordable cities in Ontario will once again face economic eviction in an unregulated rental market.

The government said it was meant to encourage more builds and increase the housing supply. The provincial government, backed by some academics and industry players, says the rent control exemption is a way to incentivize the development of much-needed rental supply with hopes of pushing rents down. But other academics and advocates argue the trade-off for tenants facing a lack of stability is too steep, and that the number of units actually built since the policy came into force hasn’t been enough to address demand.

This rental control was paused during the pandemic, but tenants in new builds will soon face a return to unrestricted rent hikes as the freeze came to an end at the end of 2021. Apartments that do fall under rent control have to follow Ontario’s rent increase guideline, which is capped at 1.2 per cent for 2022.

More than 7,500 purpose-built rental units have been built in Toronto alone since the policy was enacted, says market research firm Urbanation, plus an untold number of condos and other homes rented out by investors. And as the years go on, more and more tenants are finding themselves in units without rent control and facing the prospect of large rent spikes.

And with a pandemic-era rent freeze ending last month, Urbanation president Shaun Hildebrand expects some tenants who signed leases mid-COVID-19 — when some landlords offered lower rents or incentives amid lower demand — may see higher-than-expected jumps. “I think some tenants are going to face a bit of a shock,” he said. He thinks more renters ought to be aware of the rules and whether their unit qualifies before signing a lease

The NDP is trying to pass a bill – The Rent Stabilization Act - that would ensure that when you move into a new apartment you pay the same rent as the previous tenant did. The bill is to stabilize rents and crack down on renovictions.

Bosley Real Estate Ltd. is a full-service boutique brokerage operating in Toronto, Muskoka, Niagara-on-the-Lake, Port Hope and Cambridge, Ontario since 1928. We have three centrally located offices in Toronto and over 250 sales representatives selling and leasing homes and condominiums in all the vibrant communities we work in. Our brand is well recognized internationally thanks to our unique affiliation with Leading Real Estate Companies of the World. Our sales teams meet weekly to discuss market conditions, trending topics, and anecdotes that more accurately reflect the true temperature of the real estate market.

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Brian C. Mayer Sales Representative