Guest post by Penelope Graham, Zoocasa
Getting into that coveted under- or post-grad program is a coup for any student regardless of their career journey. Toronto is an especially attractive destination for learning, with literally thousands of courses offered by some of the nation’s top schools.
However, those looking to relocate to Canada’s largest city face an uphill battle when it comes to housing. With the city’s vacancy rate stubbornly below one per cent, and thousands of new renters arriving every year, scoring a suitable rental within budget may just be the biggest challenge facing prospective students.
The reality is that, despite measures taken by the former Provincial Liberals last spring to protect tenants and stabilize rent growth, Toronto continues to be one of the most expensive markets to rent in.
Toronto Rents are Getting More Expensive
According to second-quarter rental data from the Toronto Real Estate Board, average rents have soared year over year, further exacerbated by a lack of supply. The average one-bedroom unit now fetches 10.4 per cent more than in 2017, at $2,055 per month, while two-bedroom unit rents rose 8.8 per cent to $2,755. That’s brisker than price appreciation for Toronto homes for sale, which rose 8.6 per cent this August. And Toronto’s coming tech boom isn’t helping matters.
Jason Mercer, head of market analysis at the Toronto Real Estate Board, says the changes brought forth in the provincial Fair Housing Plan, which include rent controls for all units and new compensation rules for tenants evicted for personal use, do little to address the real issue: there simply aren’t enough units to go around.
Most rentals in the city are provided by private investors and owners of Toronto condos, as developers have had little incentive to build rental-purpose units. “As a result, the strong competition between renters continues to sustain double-digit or near-double-digit annual average rent increases,” says Mercer.
A Reality Check for Newcomers
These extreme conditions can be an unpleasant reality check for those moving to Toronto from smaller urban or rural centres, forcing would-be tenants to assume a “survival-of-the-fittest” mentality. That was certainly the case for Kenneth Hoang, a marketing and data specialist filling an internship position at Zoocasa as part of his Honours Political Science program at the University of Waterloo.
After months of fruitless searching – including narrowly missing out on a unit due to deposit timing – Hoang now rents from relatives.
“The Waterloo rental market is actually a lot easier to find a place since most of the buildings are built and catered to students,” he says. “This meant that there were plenty of options for me to choose from. Also, another big thing was that people actually replied in a timely manner and didn’t require you to put down a deposit immediately.
“I guess that could mainly be attributed to students needing to sublet out a place as soon as possible compared to Toronto landlords who can afford to wait for a prime occupant.”
5 Tips for Finding a Rental in Toronto
The market’s breakneck speed and the pickiness of landlords weren’t the only hurdles Hoang encountered on his rental search. Here are his top tips for prospective tenants looking to break in.
The early bird gets the worm: “I started [my search] in June, which I thought was plenty of time to look, but it turned out to not be enough,” says Hoang. “Another thing is to check for new postings as soon as you wake up for before you head to bed since it gives you an edge over the competition.”
Have your deposit ready: Hoang emphasizes that when it comes to securing a rental, cash is king. “Since sublets and landlords want money as soon as possible, they will usually take whoever is able to pay first,” he says, recounting the rental that got away. “The problem I had was that I wanted to do the deposit at the end of the day after I returned to Guelph. It really sucked when I learned from the person I was supposed to be renting from that someone else got the place simply because they could pay the deposit earlier. However, while timing is of the essence, it’s still important that renters take care with their deposits: never issue a payment that doesn’t have a paper trail, such as cash up front or a wire transfer.
Be flexible with timing: One of the greatest challenges Hoang faced was that he only needed a unit for four months, due to the time period of his placement. “Whenever I messaged a landlord to see if their place was still available for rent, their first question was ‘are you able to do an eight-month sublet?’,” he says, acknowledging his shorter lease time put him at a distinct disadvantage.
Use all of your resources: Hoang says that he used a mix of sources including Kijiji and Craigslist, as well as various Facebook groups, to get the inside scoop on rental listings. Working with a real estate agent – usually a free service for renters as the commission is paid by the landlord – is also a great way to view rentals that are only available on MLS (Multiple Listings Service), and can give you an edge on applicants who don’t have agent representation.
Know your rights, and watch for scams: Above all else, it’s important for prospective tenants to be informed of their rights, as well as potential red flags. Due to its popularity, the Toronto rental market is rife with scammers looking to part a desperate unit hunter from their cash. Unscrupulous landlords may also make unacceptable requests or demands of their tenants. To avoid these pitfalls, tenants should be familiar with the standardized lease recently put into force in the province of Ontario, as well as know what questions a landlord may or may not ask them during the application process.
Zoocasa.com is a leading real estate company that combines online search tools and a full-service brokerage to empower Canadians to buy or sell their homes faster, easier and more successfully. Home buyers can browse real estate listings on the website or the free iOS application.