TORONTO — It’s going to cost Ontarians more to heat their homes if they use natural gas this year, as prices are expected to rise by about 15 per cent.

Enbridge Gas said that homeowners could have to pay up to $44 more a year depending on where they live.

That’s why, if you’re eligible, you may want to take part in a program that will provide you with free energy upgrades including insulation, draft proofing and a smart thermostat.

“There is no catch here. It is absolutely free and there are no upfront costs. We just really want to get the word out,” Corrie Morton, Supervisor of Affordable Housing Energy Conservation Programs with Enbridge Gas, told CTV News Toronto Tuesday.

It’s called the Home Winterproofing Program and since it began in 2012, more than 22,000 customers have taken advantage of the energy-saving upgrades.

Enbridge says that up to 400,000 Ontario homes could still be eligible for the energy-saving freebies.

In order to participate, you have to have an Enbridge Gas account and heat your home with natural gas. Renters also qualify for the program but must get permission from their landlord to take part.

Morton said, if a person qualifies, they may be entitled to free insulation for the walls, attic or basement, as well as free draft proofing to seal air leaks.

They will also receive a free smart thermostat that adjusts automatically to keep you comfortable without wasting money.

Eligibility also depends on your household income level, the number of people in the home and if you receive assistance from a government program.

You must meet one of the following criteria:

Income level (before tax)

  • 1 person = $36,578
  • 2 people = $51,729
  • 3 people = $63,354
  • 4 people = $73,157
  • 5 people = $81,791
  • 6 people = $89,598
  • 7+ people = $96,775

When the cold weather arrives, you’ll also want to make sure all your windows are closed tight, that your furnace is working and that your furnace filter doesn’t need to be replaced.

The program is fully funded by Enbridge Gas and the company says customers should only go through the Enbridge website. There is a warning on their website to be careful of social media ads offering a home renovation rebate or a $50 rebate on your natural gas bill. The website warns these are not legitimate offers.

The company also warns of individuals going door-to-door who claim to be with Enbridge Gas or who claim to be offering rebates or free services.

“Enbridge Gas does not go door-to-door,” Morton said.

Even if you don’t qualify for the program, there are many steps you can take yourself to try and lower your heating bill.

The COVID-19 pandemic has forever changed our relationship with our homes. Through periods of lockdown and stay-at-home orders over the past 18 months, our residences have served us more than ever before, as classrooms, remote offices and workout spaces.

To test how consumer sentiments about their home have shifted as a result of the pandemic, the two-part America At Home study gathered over 7,000 insights from US adults in 2020 to understand the design changes they want to see in new homes and communities. Then they built the house.

Taking the data insights from the America At Home study, North Carolina-based builder Garman Homes set out to tangibly represent the needs of consumers by building the Concept Home. Known as The Barnaby, the two-storey 2,600 square-foot Concept Home in Chatham Park, Pittsboro was constructed within a 60-day timeline and was revealed to the public for the first time in July 2021.

The property was designed for a theoretical older Millennial family with a pre-school and elementary school-aged child and two parents, one who works outside of the home and one who works remotely from home. Based on the study findings, The Barnaby reflects five “features for life” that respondents said were important to them — arrive, eat, recharge, work and breathe — and works in a variety of design changes that reflect these desires.

Alaina Money-Garman, founder and CEO of Garman Homes, talked to Livabl about how the Concept Home came to be and how it manifests the present-day needs of new home consumers.

Why did you want to create a tangible, physical example of the home based on the study’s findings? How did you reflect consumer insights in the Concept Home?

One of the study questions was “What does home mean to you?” Ninety-eight per cent [of respondents] said home means safety. So then as a builder I’m thinking “How many different ways can I reflect that I heard this concern from the consumers in the design of this home? How many different ways can someone walk through and say, ‘I feel safe, this feature makes me feel safe’ without it saying ‘This feature is supposed to make you feel safe.’”

The way that we did that was that we paid a lot of attention to the entrances and the exits of the home and how you could entertain safely and how the home kind of transforms from a closed-in space to a wide open space, and how that was achievable within a certain square foot parameter. We don’t want this thing to be a Frankenstein, [an] unlimited square foot home. It’s a 2,600 square foot home, and so how many different ways can we reflect what the consumer wants through thoughtful design?

I think it forced a level of creativity amongst all of us to start thinking about homes differently. Builders can be quite prescriptive in the use of space, and I think what we wanted to do with this project was really empower the consumer and the homeowner to tell us how they want the space, and how they need the space, to perform for life from home.

How did you take this research and use it to create and design a home based on the study findings?
We did three design charrettes virtually to just talk about the study results. We all had to get oriented to the study, so architects, builders, consumer experience specialists and then the study founders, and we all had to review the study findings and then hold each other accountable to what that would mean for design, and kind of set our boundaries for how this home should look and feel.

We’re not building this home on an island — we’re building the home inside a master-planned community in Pittsboro, North Carolina called Chatham Park, which is a one-of-a-kind community in this area. It will be the largest of its kind [at] 20,000 units in a relatively small town. You’re building a town really within a town, and this is the centre of innovation, so how are we going to reflect that in our process?

For our design stretch, we met every Tuesday for three hours on Zoom. Initially we did table stakes, sort of “How do we want this home to look? What are the parameters for square footage, and price range and features? Because it can’t be a Frankenstein home of just parts that we want to do or have to extend from the outside to the inside to all the way through.”

We used Pinterest boards to facilitate a virtual design charette where we just pinned ideas that we thought reflected the data. We had these public Pinterest boards amongst the group and everybody pinned to the boards and then we voted a primitive sort of red [or] green. Room by room, a red dot meant that you didn’t like it and a green dot meant that you did, and ultimately, as the builder, I think we had a little bit more influence on “That’s feasible and that’s not. That’s in the price range and that’s not.”

And so, collectively, we came up with all of the images that we loved and the parameters that we were going to hold each other to and then the architects drew the floorplans for us, add then we all weighed in on how we wanted that floorplan to evolve.

You mentioned designing the home in a way that is not just adding more and more space onto the footprint, like a Frankenstein house. Can you elaborate on that idea a bit?
For me, that means that I’m trying to imagine how families use space. I’m trying to imagine all [of] the different family combinations first, and how the space will serve or not, that family combination. How will the space adjust to people with or without kids? How will the space adjust if you had a multi-generational family inside the home?

That space right before you go to your garage, needs to reflect what you need, where you need it. For us now, it’s about handwashing, or snacks or water. Coming back into the home, [it’s] even more intense in terms of decontamination and how we can keep the germs from outside and things we bring inside, how do we keep them in a room where they can be processed, laundered or washed [and] not infecting the other person? Sort of controlling traffic flow of things and people from the outside to the inside of the home.

I’m always imagining how the space is performing for the people that we imagine will be using it. [When it comes to] intention-setting for us, there was a huge burden of caregiving during the pandemic, especially for parents trying to work from home and kids schooling from home. We were very intentional with the kitchen being fully-accessible by the children, even though we’re designing this for an older Millennial family with one elementary school [age] child and one pre-schooler. And the reason we do that, [is because] we drill down to bat level [effectiveness] so we don’t lose the idea and try to create this home for everyone. Because if we boil it down to accents and really try to reflect this exact family, there are throughlines that other family formations will see in there.

For the kitchen, in [regards to] the caregiving of the home, we put open shelving on the island and located all of the children’s plates, and cups and their forks and their knives and even some of their art supplies [there] so that kids can be more independent in terms of getting themselves a snack or returning their plates to the dishwasher and locating that within easy proximity. [We built] a table into the island so that there could be a surface that could not be destroyed by art projects or food or whatever.

Imagining someone working from home and kids taking a bit more active [role] of their own caregiving. The pantry cabinets pull out and have drawers and sliding shelving that’s at their height so that every person is empowered to use the kitchen well, so not one person is involved in it. And touchless faucets make that fun for kids. The burden of handwashing is real, so how can we entice kids to want to do it more? [That’s] one way of sort of helping everyone out by making it a little bit easier.

Based on the research and personal experiences of spending more time at home during the pandemic, what were the biggest changes in the home that the Concept Home reflects?
Having two working spaces from home, two office spaces that aren’t part of another room, that aren’t part of a bedroom. For us, that meant finding a space for opportunity for smaller rooms that could accommodate big privacy.

So there’s a room under the stairs called a Zoom Room and it has a counter-height work surface so you can stand and give a presentation in there. It has bookshelves in the back that have an interesting background. It has a window with natural light so you have great lighting, and it’s proximate to the school which is the other space that we located on the first floor.

We did a dutch door on that space to sort of queque children this sense of arrival at school, knowing that when they were at school, to set the stage for the purpose of that room, and then closing it at the end of the day and arriving back at home as a child and being at home, just like parents who used to put our work away at the end of the day, and kids do as well. They need that sense of release. When they were at home during the pandemic, it got really blurry between “Am I at work? Am I at home? What am I doing?” and kids got really overwhelmed, so I think that whole school room is really innovative.


The other space that we really spent a lot of time on was the family bathroom, the concept of a larger family bathroom and a smaller primary bath. And the reason we did that was because a lot of times secondary bathrooms are soaked up by a get-into-a-bath or a bette bath and the problem with those spaces is that they are big enough for children who are old enough to be independant and take care of themselves, but there are a ton of doors. There’s a lot of doors in those spaces, and it can be hard to manage.

So if you have younger children who need caregiving at the end of the day [with] bathing and help brushing their teeth and getting them ready for bed and that whole night time ritual, that whole nighttime ritual is a nightmare in a space that doesn’t have enough square footage to accommodate the kids and the caregiver. So we allocated a lot more square footage to this idea of a hallway-access family bath that has a full shower and a full tub.

Because what ends up happening is instead of it being too small to properly care for your kids, they end up in your bathroom which is larger, in your bathtub, and then when you need a moment of self care after they’re in bed, you go to your bathtub and it’s full of toys. And that is just not a great feeling, and we wanted to make this space enticing to the kids to use, and also allow us to help us reserve the primary bath for the primary occupants and not have to share that necessarily with the kids. It’s a beautiful bathroom. It has a glass wall, and it also grows with the kids. It has a full-sized shower with a bench and tub and this huge picture window in it. It’s a really interesting and different space.

What has the response been like about the Concept Home from the industry and home buyers? What will you do next?
We continue to research, we want to attempt to continue to research. We have these decals in the garage that we invite people to respond to the areas they like the most, something we may have missed, an idea that they wish we would have explored. [There is] a summary of the data and how we used the spaces to reflect that data, so sort of directing people towards “This is what the data said that this is how we responded to it,” and sort of giving people an opportunity to check us and participate and continue the conversation about how people use space.

I think what we’re going to do next, and I know we’ve already done this, is try to go through a much more robust process of designing spaces, and thinking about family formations and how we reflect space, and also soliciting more direct consumer feedback when we are designing collections and including some of the consumers in that process on voting on different arrangements of space, different options in those spaces. I know we’ve already done that in some of our price ranges.

I think what we’ll do next though is I’d love to see someone else build a Concept Home based on the feedback that is a smaller home with smaller square footage, a cottage home, because I think these concepts can be reflected in every price range. What I’d really like to do is spend my time finding a builder who’d love to take this on and build in a different part of the country and reflect it in a different price range. I think that will be our new creative exercise, and there will be a lot of puzzles to solve in that.

How do you think the Concept Home will influence new construction homes in North America, post-pandemic?
I hope it tells people that the bar has been raised for homes and for designing spaces and floorplans and we need to meet the buyer or the consumer where they are, and really start with what their life looks like and how we want our spaces to feel and how we want our spaces to make the buyer feel.

I want them to feel empowered. I want them to feel comforted and safe and courageous and able to live their life that they dreamt about. I can’t do that by designing homes in a bubble without collaborating and asking people about what their life is like behind closed doors. I think sometimes we run the risk of designing homes that feel like fairytale spaces maybe, that may think [that] everyone lives these perfect lives, [and instead] embracing the difficulties and the burdens people that face and wanting to make sure our spaces reach them in their darkest moments and their best moments.

I hope this home inspires builders to embrace design from adversity, from a time when life has been difficult for people, and helping them stay connected to the people they love but also stay safe at the same time. I don’t think that we’re going back to life as normal. I think that there is a new normal, and I like being more intentional and thoughtful about how we can invite people into the practice of collaboration to effect homebuilding.

Never in the history of the Greater Toronto Area has there been a hotter August for condo sales.

In the midst of a pandemic, the Building Industry and Land Development Association said sales jumped 35 per cent from a year ago and sat 129 per cent above the 10-year average. Single family home did less well, down 15 per cent from the 10-year average.

“Buyers flocked to the new condominium apartment market in record numbers in August as builders pumped in unprecedented levels of new supply,” said Edward Jegg, analytics team leader at Altus Group. “But in the new single-family sector, supply shortages continued to weigh on sales.”

That shortage led to higher prices – with the benchmark price for a single-family home hitting a record high of $1,521,968 in August. That’s an increase of 30 per cent in a year.

The benchmark price for new condominium apartments eased in August compared to the previous month, to $1,069,700, which was up 10 per cent over the last 12 months.

Over the past 12 months, housing starts have been their strongest since the mid-1970s and the number of homes under construction is at an all-time high, according to new research published today by RBC’s senior economist Robert Hogue.

The COVID-19 pandemic triggered a historic drop in interest rates. Coupled with changing homeowner needs and increased levels of household savings, Hogue says buyers gobbled up the stock of existing for-sale properties and drained new home inventories.

“These, and sky-rocketing prices, proved unambiguous signals for builders—and municipal permit-issuing authorities—to get cracking and expand Canada’s housing stock,” said Hogue.

Over the past 12 months, builders have poured foundations for 260,500 homes, which is considered a housing start. This is the highest quantity since 1977. It also marks a 26 per cent increase, or 53,600 more units, relative to the 2015-2019 average pace of 206,900 units.

There are almost 320,000 housing units under construction nationwide, 30,000 units more than the end of 2019. Three-quarters of this total is dedicated to apartments, most of which are tenured as condos according to Hogue.

There’s the old adage in the industry that buying a home is cheaper than renting long-term. Despite sky-high property prices in many Canadian cities, that still rings true according to research published today.

In a study conducted on behalf of the company by economist and housing market analyst Will Dunning, new data shows that for those who are able to secure a “sufficient downpayment,” it is still more financially advantageous to buy compared to renting in 91 per cent of cases studied.

Read more

A major concern that the industry has had for nearly a decade is that the pace of new condo price growth has far exceeded condo rent growth.

The chart below looks at the average price for new condos in postal codes M5A and M5V in Toronto (Downtown East, King West, Entertainment District), as well as the average rent per-square-foot for a sample of condos for lease in those postal codes via data from

At the start of 2020, prior to the pandemic, condos for rent were going for about $3.90 psf on average in these areas. Rent fell a whopping 20% over the next year, while new condo pricing stayed constant at $1,320 psf (there were a limited number of launches).

Since February, the average condo rent has increased by 13% to $3.50 psf, while condo prices have increased by 6% to $1,396 psf.

A 500 sf unit at $3.50 psf is $1,750 per month. When just looking at the mortgage payment of a 500 sf unit at $1,396 psf, before the condo fee, taxes, insurance, etc. is added, that equals about $2,425 per month at 20% down.

How much longer can the disconnect between rents and prices go on, or is this the new normal? Do you think that we will never have any relationship between the two measures moving forward? We’d love to hear your thoughts.

Bullpen Research & Consulting works with big data from Buzzbuzzhome (BBH), America’s largest online marketplace for new construction homes, and monitors the average price of “popular” floorplans based on the thousands of monthly data points and pageviews. The chart above looks at the average price for the central downtown core based on the popular unit data over the past three and a half years (the coverage area is generally south of College Street between Strachan Avenue and the DVP – postal codes M5A, M5B, M5C, M5E, M5G, M5H, M5J, M5K, M5V, M5T).

In August of 2021, the average price of new condominium floorplans on BBH in the downtown core was $1,431 psf, an increase of 10% annually compared to August of last year.

During the pandemic, pricing had declined by nearly $95 psf from $1,398 psf in late 2019 to $1,305 psf in June/July of last year. A lack of launches, especially luxury launches, and a slow sell off of smaller units with higher per-square-foot pricing was the likely reason, as opposed to developers actually lowering prices. There were a few “less aggressively” priced launches last year during the second wave.

The chart below looks at a sample of suites offered in 2021 by rounded unit size at five of the most prominent launches this year (suites above 1,049 sf were eliminated). The average price for these suites is $1,420 psf on average, with enormous pricing for the suites rounded to 300 sf and 400 sf ($1,632 psf and $1,582 psf, respectively).

The GTA suburban new condo prices have been booming – as we mentioned in a recent newsletter – and there are worries around downtown prices rising too quickly as well. A good measure of whether new condo pricing is too high is to compare those prices to a ‘newer’ resale project to see how much higher they are. In the past, 15% to 20% has been a “reasonable” gap or new price premium. A look at a few examples below using recent resale trades via

1. Natasha Condos, ~500 sf = $1,545 psf. Peter Street Condos, recent 506 sf unit sold for $1,206 psf. Price gap of 28%.

2. Prime Condos, ~500 sf = $1,474 psf. Stanley Condos, recent 502 sf unit sold for $1,273 psf. Price gap of 16%.

3. Goode Condos, ~500 sf = $1,443 psf. Clear Spirit, recent 538 sf unit sold for $1,301 psf. Price gap of 11%.

4. 400 King Condos, ~500 sf = $1,362 psf. King Charlotte, recent 495 sf unit sold for $1,202 psf. Price gap of 13%.

5. The Whitfield, ~600 sf = $1,470 psf. Sixty Colborne, recent 585 sf unit sold for $1,060 psf. Price gap of 39%.

As a reminder, the pricing in the chart below is NOT a comprehensive look at all suites in the project, but based on a sample of available product only.


Canada’s housing supply fell short of demand even before COVID struck, a situation the pandemic brought into sharp relief. It’s not that home builders have been sitting idle. Housing starts over the past 12 months were the strongest since the mid-1970s, and the number of homes under construction is at an all-time high. The problem is that it takes time for new construction to reach the move-in stage. The average timeline has more than doubled over the past two decades, from 9 months to 21 months.

The construction boom is beginning to deliver more move-in-ready supply. Housing completions should accelerate in the coming year—provided supply chain-disruptions in the construction industry don’t interfere too much with ongoing work. Yet the market impact will vary across the country. Smaller markets are seeing the bigger relative increase in housing starts, and will get more supply sooner. It will be a longer wait in some of Canada’s larger markets, where the pandemic construction boom has been more subdued and heavily concentrated in slower-to-build multi-unit dwellings. Big-city supply issues are likely to persist, especially as stronger immigration drives up housing demand in the coming years.

The pandemic got builders cracking like it’s 1977
The pandemic triggered a sharp drop in interest rates, a huge build-up in household savings and changing housing needs that sent an unprecedented wave of Canadians scurrying to buy a home. The stampede syphoned off the stock of existing homes for sale and depleted newly built home inventories, especially for sought-after single-family and other low-rise homes. These, and sky-rocketing prices, proved unambiguous signals for builders—and municipal permit-issuing authorities—to get cracking and expand Canada’s housing stock.

Their answer has been dramatic. In the past 12 months, builders across the country have poured the foundations (defining a housing start) for the highest number of housing units (260,500) than at any time since 1977. This represented a 26%, or 53,600-unit, increase relative to the 2015-2019 average pace (206,900 units).




There have never been so many units under construction in Canada
The pile of new projects put more strain on builders’ already record workload. There are now close to 320,000 housing units under construction in Canada. This is by far the highest number, and a 12% (or more than 30,000-unit) increase from the end of 2019. About three-quarters of the total are apartments (mostly condos but also rental).






So far, new homes ready for occupancy are rising much less dramatically
All that construction activity has yet to significantly boost the move-in-ready supply. It can take from six months to several years to complete a unit, depending on the type. Various pandemic-related disruptions and challenges no doubt lengthened the process. Still, completions are rising: builders have completed 215,000 new units in the past 12 months, up from an average of 193,000 units from 2015 to 2019. This continues to be short of the 220,000 average increase in the number of Canadian households in the four years preceding the pandemic.






The pace is poised to accelerate
We expect completions to rise materially in the coming year as builders put the finishing touches on units started both before and during the pandemic. The sheer number of apartments under construction (with typically longer production timelines) should also support high completion counts beyond next year. While many factors can alter delivery schedules, we think as many as 240,000 housing units could be completed in 2022 nationwide—the biggest push in a generation to address supply issues. Stronger levels like this will need to be repeated in years to come to make up for under-building in the past decade and meet growing demand arising from record projected immigration. Relative to population, completions have stayed below their long-term average throughout the 2010s.






Smaller markets to see a quicker boost in supply
Canadians’ love affair with smaller towns’ lifestyle and relative affordability during the pandemic has sparked a construction boom unequaled among larger markets (all proportions considered). Rural and small urban areas recorded the strongest growth in housing starts in the past 12 months relative to the 2015-2019 period, rising 51% and 33%, respectively. Medium-size urban areas weren’t far behind with an increase of 27%. Not only that, the types of housing built are predominantly (70%) single-detached and other ground-oriented homes, which have usually shorter construction timelines. This means the builder response in smaller markets is not only significant size-wise but its impact on supply will be quicker than in larger metropolitan areas where apartments accounted for 62% of starts in the past 12 months.

This isn’t to say big-city builders dragged their feet during the pandemic. They, too, poured many more foundations (housing starts climbed 23%). In fact, census metropolitan areas (CMAs) accounted for the bulk (38,000 units) of the overall increase in housing starts (57,000 units) from the 2015-2019 average. It’s just that the timeline toward completions will be longer for the most part.





The picture in major markets is mixed
Housing starts barely increased in the Toronto region in the past 12 months compared to the 2015-2019 average, rising just 1.4% or 500 units. The ramp-up in new construction was a little more vigorous in Edmonton (up 4.1%), Calgary (up 7.2%) and Vancouver (up 10.3%) but still well below the national average (26%). Relatively flat starts in the Toronto area in part reflect a significant drop in pre-construction condo sales in 2018 and 2019 following Ontario’s Fair Housing Plan in 2017. A recent spike in building-permit issuance suggests the pace could pick up. Failing that, the supply response will look underwhelming in the region—prolonging the significant challenges facing buyers and renters.

Builders are working hard to address supply issues in Montreal and Ottawa. Housing starts over the past 12 months were up 11,000 units (or 50%) from the 2015-2019 average in the Montreal area, and up 5,700 units (or 65%) in Ottawa-Gatineau. Purpose-built rental units accounted for more than 90% of the increase in Montreal.





Are the right kinds of unit being built?
The sheer number of homes slated to come to market is one thing. But will they be the right ones to meet demand across the country? Yes and no. The new units for the most part have already found takers. Builders and developers most often start construction on projects only after they have firm sales agreements in hand. The market’s answer is therefore yes. At the same time, it’s unlikely the new supply will fill the huge housing gap for Canadians of modest means. High and rising construction costs pose tremendous challenges for builders to produce more affordable options, leaving many Canadians struggling to get on the housing ladder.

The pandemic has also thrown into question several prior housing preferences. Extended time spent at home prompted many Canadians to seek larger living spaces, and loosened attachment to live in core urban areas. While it’s unclear how permanent these changes will be, there’s a potential that unit size, configuration and location of recently started high-rise projects may fall out of favour. Apartments (both condos and purpose-built rental) not only accounted for most (55%) of the housing starts over the past 12 months, but also showed the biggest increase (39%) from the 2015-2019 average.





Mix of new housing needs recalibrating
Slow supply responsiveness has been a central issue for Canada’s housing market for years. While we’re encouraged to see municipalities issuing more building permits and builders cranking up housing starts over the past 12 months, it still takes close to two years on average to build a home (ranging widely across housing types). This average construction length has more than doubled over the past two decades. The main reason is apartments (taking the longest to build) have come to represent a significantly larger share of homes built. Limited construction capacity has also been a factor in some parts of the country. And those timelines don’t even count the time (and resources) required to obtain the proper approvals and permits to get shovels in the ground.

Part of the solution to Canada’s housing market imbalance runs through the mix of new units being built: a recalibration toward project types that can deliver move-in-ready units more quickly to market—like low– or mid-rise housing—would boost supply responsiveness. Addressing the ‘missing middle’ (lack of medium-density housing) in some of Canada’s largest urban areas, for example, would be a significant step in that direction. This should be done in conjunction with a sharp focus on streamlining regulatory and project approval processes, and tackling skilled trade shortages and other constraints that limit production capacity.









Supply shortages are hitting single family starts, despite an overall rise in the number of homes being built and homebuilder sentiment improving for the first time in three months, two reports show.

Builder sentiment rose in September by one point, according to the National Association of Home Builders/Wells Fargo Housing Market Index, amid a drop in lumber prices and a rise in buyer demand.

Last month also saw a 17.4% year-on-year rise in private housing starts, as well as a month-over-month increase in permits, according to a separate report released this week by the US Census Bureau and Department of Housing and Urban Development (HUD) on new residential construction.

The increase in permits and starts is seen as a response to near record-low rates, the limited supply of existing homes for sale and the unrelenting demand for properties.

The upbeat news from the construction sector was, however, offset by the fact that starts on single-family homes fell 2.8% month-over-month during the same period.

First American deputy chief economist Odeta Kushi (pictured) told MPA that while the homebuilders’ sentiment and the overall housing starts increase “was good news”, she pointed out that multifamily housing starts had been the main driver.

She said: “The multifamily has really been responding to the people coming back to the city; the lower vacancy rates and the higher rents that we’ve been seeing.

“Builders are responding to that and to the demand for apartments, and we’re starting to see that creep up in the numbers. This was not at the expense of single family, necessarily, because the decline in single family starts really has a lot to do with supply shortages as opposed to any sort of weakening demand.”

She added that the homebuilders’ sentiment helped to confirm her view that they were responding to strong demand for homes, but that “they would like to build more single-family homes”.

She pointed out that the rate of single-family home projects which had been approved but were still waiting to commence had soared by 50% year over year.

“That’s clearly a sign of ongoing supply chain issues – builders are kind of trying to finish up projects rather than starting new ones,” she said.

The current projects she referred to include a record number of single-family homes under construction, which had increased to 702,000 units – the highest level since 2007.

She, however, expressed concern about material shortages and was less effusive about data showing that lumber prices had plummeted, from more than $1,600 per thousand board feet to the more recent price of about $400.

“Lower lumber prices are reflected in the stock market, but they have not yet made their way to builders. The hope is that they will, which should help to ease the cost,” she said, warning that there were still significant shortages in construction materials, particularly for windows and cabinets.

In addition, she alerted to the fact that more skilled laborers in the construction industry were needed. “Those were headwinds that existed even prior to COVID and made worse by the pandemic,” she said. “So I don’t anticipate they will disappear entirely.

“The bottom line is the housing market has been underbuilt for a decade and builders can’t close the gap between supply and demand overnight, but they are trying.”

Nonetheless, she said she expected the easing of supply shortages as the country entered the fall and winter months, which would give builders “a chance to catch up”.

Her comments echoed the views of Dr Robert Dietz from the National Association of Home Builders (NAHB), who last week said that supply chain problems could ease over the next year to year-and-a-half.

“I would generally agree – I think that we’re starting to see that in other parts of the economy as well,” she added.

Looking ahead, she said she expected to see a modest rise in mortgage rates over the medium term due to the improving economy.

She said: “The 30-year fixed rate mortgage is loosely benchmarked to the 10-year Treasury yield, and when times are good, you see that yields creep up and mortgage rates alongside it, likely by the end of the year.

“With that said from a historical perspective, we don’t anticipate that increase in mortgage rates to be substantial. It’ll be a pretty modest increase.”

Government support and payment deferrals played major roles in improving Canadians’ financial health, Equifax said

Despite the end of payment deferral programs, Canadian mortgage delinquency rates declined from first-quarter highs in Q2, according to Equifax Canada.

The 90+ day mortgage delinquency rate fell by 32.6% annually in Q2, while the rate for non-mortgage products dropped by 28.6% during the same period. On average, the Equifax credit score for consumers grew by 12 points over the last two years.

“The consumer credit market continues to recover from the effects of the pandemic, with government support playing an important role in improving Canadians’ credit health,” said Rebecca Oakes, assistant vice president of advanced analytics at Equifax Canada.

However, with this support steadily winding down, a near-future spike in late payments is possible, Oakes said.

“We may see surprise insolvencies occur where consumers with no delinquency history on file and a decent credit score end up filing without warning,” Oakes said.

Another major area of concern is the growing volume of mortgage debt taken on by Canadians with lower credit scores, Oakes said. While this cohort accounts for just 10% of all new mortgages, their average loan amount has increased at the same rate as consumers with higher credit scores.

The risk is amplified by the 3.7% inflation rate in the 12 months ending August, the highest annual increase since May 2011.

“Prices for consumer goods have risen and if the inflation trend continues, there is potential for an earlier-than-planned interest rate increase to curb this,” Oakes said. “With many consumers now heavily leveraged and the potential for increases on variable rate mortgage and HELOCs, consumers may find themselves not in a position to pay back their debt obligations if interest rates rise.”

Source: Equifax Canada

Retail sales in Canada rebounded after falling earlier in the summer months, a reassuring sign that consumers continue to spend.

The value of receipts rose 2.1% in August, according to preliminary results provided by Statistics Canada on Thursday in Ottawa. That more than offset a 0.6% decline in July. Retail sales are still below the record monthly total reached in March, but are well ahead of pre-pandemic levels.

August retail sales were at about CA$57 billion, according to Bloomberg calculations. That compares to an average monthly total of CA$55.2 billion between April and July for retailers, when sales stalled.

Some economists suggested the spending pause over the summer was due to reopenings that shifted consumer activity toward services businesses like restaurants and gyms.

Source: Bloomberg News

Canada is in election mode, and all politicians have a plan to cool real estate markets. The thing is, most markets have begun to cool on their own. Canadian Real Estate Association (CREA) data shows a third of markets made a monthly pullback in July. The trend is likely to get stronger as well, as over 4 in 5 real estate markets have seen annual growth drop. There’s still a long way to go before it would be a “correction,” but it may be a sign cooling measures aren’t as urgently needed.

Momentum And Price Growth

Every new trend starts with a change in direction. The momentum of price growth is one of the most important measures of this. It drops a few hints on the direction of where the market is heading, and how people may react.

When price growth accelerates, the rate of growth is rising. If it abruptly begins after a downturn, it may be marking the bottom of the market. Early in this stage is when buyers make the most money, and feel the luckiest. As the trend accelerates, sellers have more incentive to hold onto their property. It doesn’t matter if it’s negative cap, as long as it rises in value, right? The faster prices accelerate, the less likely an investor is to sell. Ironically, this means lower inventory, potentially accelerating prices further.

Price growth deceleration is when the rate of growth is getting lower, or even negative. If this happens after a period of acceleration, it can mark the top of the market. This is when sellers make the most money, and feel the luckiest. As the trend decelerates, more buyers tend to stand back and delay their purchases. Often they’re waiting to see if prices fall. The FOMO to jump into the market immediately may also disappear. If you’re not as worried about being “locked out” of the market, you’re not in as much of a rush to purchase.

The best time to sell is often the worst time to buy. Conversely, the best time to buy is often the worst time to sell. It’s tricky identifying when those turns happen. The momentum of price growth is a pretty good starting point though. Remember, that’s starting point. Not your comprehensive, single-point market guide.

A Third Of Canadian Real Estate Boards Reported Lower Prices In July
First, let’s start with which markets are actually pulling back in dollar terms. A third of boards, 16, reported monthly drops for the July composite benchmark. Data also shows 38 markets printed smaller monthly gains than the previous month. Prices don’t move in a straight line, so some variance should be expected. Once it turns into the annual trend changing direction though, it’s harder to see a turnaround.

Canadian Real Estate Price Monthly Change
The monthly change in the composite benchmark price of a home for July 2021.

Over 4 In 5 Real Estate Markets Saw Annual Growth Decelerate
Annual growth of composite benchmark price has dropped in the majority of markets. Over 4 in 5 markets reported the annual rate of price growth as fallen. Just 8 markets have seen flat or accelerated price growth. Some of these rates are astronomically high, so it’ll take a while to get back to reality. But once these trends start to fall, a catalyst is often needed to reverse them. It’s an election though, so a capital injection in the name of affordability might be seen. Never underestimate how poorly bureaucrats can misread the market.

Canadian Real Estate Price Annual Change
The annual change in the composite benchmark price of a home for July 2021.

Most markets are now seeing a deceleration in price growth. It’s also happening during falling home sales, which is interesting. Most industry observers have attributed falling sale volumes to a lack of inventory. However, if the shortage of inventory was the problem, prices would be rising. They aren’t. This is one of those narrative-reality mismatches.

Prime Minister Justin Trudeau has promised to introduce a two-year ban on foreign home buyers and make the home purchasing process more transparent if re-elected.

The Liberal Party leader told a crowd in Hamilton, Ontario that a Liberal-led government would “crack down on predatory speculators that stack the deck against you,” if returned to power in the September election, while also pledging to build more homes and introduce a rent-to-own scheme.

“You shouldn’t lose a bidding war on your home to speculators. It’s time for things to change,” he said. “No more foreign wealth being parked in homes that people should be living in… If you work hard, if you save, that dream of having your own place should be in reach.”

In its newly-published “Home Buyers’ Bill of Rights” the Liberals also promised to lower CMHC mortgage insurance rates by 25% and introduce a tax-free savings account for first-time buyers.

Trudeau’s comments were the prime minister’s latest bid to win over voters on the housing issue, one that has emerged as a potent topic in the federal election campaign with house prices having surged across Canada during the COVID-19 pandemic.

Hamilton, the scene of Trudeau’s remarks, saw a 23.8% year-over-year increase in aggregate house prices in the second quarter of 2021, rising from $613,750 to $760,000.

Current policies around foreign buyers have faced particular criticism in Vancouver, with real estate purchases by non-residents becoming increasingly popular.

Conservative Party leader Erin O’Toole has vowed in his party’s own housing plan to introduce a two-year trial ban on foreign buyers who don’t intend to live in Canada, a measure he said was aimed at addressing the country’s housing “crisis.”

“The supply of homes – to own as well as to rent – is not keeping up with our growing population and too many foreign investors are sitting on properties as investments.”

New Democratic Party leader Jagmeet Singh said that he would implement a 20% foreign homebuyers’ tax on the sale of homes to individuals who are not Canadian permanent residents or citizens.

Canadians are set to go to the polls on September 20.

Only one Toronto building makes Top 10; best investments are outside city limits
For the first time in six months, Toronto condominiums no longer dominate’s list of properties with the highest appreciation rates. If the latest data is any indication, it appears that condos outside the city are offering much higher returns on investment.

Properties in Oshawa and Burlington appeared multiple times in the Top 10, which also included condos in Hamilton and Whitby. But a luxury building in Yorkville was the only Toronto property to make the list.

“This may simply reaffirm what many of us have known all along,” says Robert Van Rhijn, Broker of Record at “Homebuyers are increasingly looking outside city limits for affordability, and the data is finally starting to reflect that trend.”

In Toronto, condos are selling on average for about $895 per square foot compared to just $647 in Burlington and $505 in Oshawa.

“By looking outside the city, you’re buying into a market at much cheaper prices with the potential to earn back that investment at a much quicker pace,” explains Van Rhijn.

Top 10 Highest Appreciating Condos in the GTA

Here are the properties that have appreciated the most in the past 12 months:

1) Burlington | Lakepoint Condos | 2190 Lakeshore Rd | +53%

2) Toronto | Pears on the Avenue Condos | 127-135 Pears Ave | +41%

3) Burlington | Vibe Condos | 5030, 5010, 5020 Corporate Dr | +40%

4) Oshawa | Wentworth Gardens Townhomes | 401 Wentworth St W | +39%

5) Hamilton | Kenora Townhomes | 250-262 Kenora Ave | +37%

6) Whitby | Sprucedale & Palisades Townhomes | 1-118 Sprucedale Way, 10-34 Palisades Crt | +37%

7) Mississauga | Glen Erin Drive Townhomes | 4171 Glen Erin Dr | +37%

8) Oshawa | Glen Street Townhomes | 1010 Glen St | +36%

9) Oshawa | Pearson Street Townhomes | 222 Pearson St | +36%

10) Oshawa | Dorchester Drive Townhomes | 540 Dorchester Dr | +34%

Glass ceiling of affordability

The latest appreciation data simply illustrates the spillover effect from Toronto’s red hot housing market where the average price of a condo is just over $720,000, according to Nathaniel Hartree-Hallifax, a realtor at When it comes to buying something decent in Toronto, a lot of people have “psychologically written that off”, as he puts it. “So they’re moving around to places outside the city that they can afford.” broker Cliff Liu caters to a wide demographic of buyers, including baby boomers in Toronto’s outskirts. He thinks this group may be fuelling those soaring appreciation rates as well.

“Many seniors are cashing out on their suburban homes, and choosing to downsize in these same neighbourhoods,” says Liu. “So they’re also adding to the demand, driving up values even faster in these areas.”

Hartree-Halliax notes the famous slogan that “a rising tide lifts all boats” to illustrate the impact of Toronto’s rising prices on the wider region.

“Even still, properties outside the city have so much more room to appreciate,” he explains. “Whereas condos in Toronto have already hit that glass ceiling of affordability.”

Parsimonious rental data in the GTA makes tracking hotspots difficult, but stories about leasing bidding wars are commonplace and, according to the president of the Residential Construction Council of Ontario (RESCON), that’s a direct consequence of developments completing at a snail’s pace.

“I’ve been hearing about bidding wars on rentals. You’ve got bidding wars on single-family homes in York Region because people looking for houses have to pay 10-20% more than the asking price in certain situations, so they’re priced out as buyers. I’ve been hearing stories about people having to pay a full year’s rent up front to rent those same places,” said Richard Lyall. “We have a housing supply crisis; we’re not building enough according to our current demographical needs and we’re running an annual housing deficit. The biggest problem in all this is the process through which projects get approved, and go through rezoning and site plan restrictions, takes too long.”

Insufficient housing supply has been blamed for exorbitant ownership price points, but Lyall contends that it also explains why rents are so high. There’s a pronounced dearth of purpose-built rental units in the GTA and investor-owned condominiums have resultantly become surrogates, he says, however, they’re without the same security of tenure that purpose-built rentals offer, to say nothing of their inadequate supply.

In fact, to understand the depth of the neglect and how it roils GTA rental markets today, Brampton, located just west of York Region, is getting its first purpose-built rental development in 17 years. But that bidding wars to lease single-family homes are increasingly common is a newer development.

Dr. Murtaza Haider, a professor in Ryerson University’s department of real estate management, says York Region’s low-rise homes are hot commodities because, unlike purpose-built rental and condo apartments, they provide families functional space, and the existing paucity of family-sized units has sparked demand for homes that are typically end user-oriented.

“It has to be in the low-rise segment because those units are desirable for families,” he said. “Rental households are smaller in size than non-renter households, and low-rise houses are more desirable for families with children, especially school-aged children, therefore, competition, when it arises because of proximity to subways and transportation infrastructure, makes a difference. Proximity to a park makes a difference, but proximity to highly regarded schools also triggers competition between interested renters.”

Citing monthly rental data, Dr. Haider says that bidding wars don’t occur with every vacancy, but they tend to cluster in desired neighbourhoods and buildings.

“If rents don’t increase drastically, that is my evidence that, while bidding wars are happening, they don’t have the ability to move the average market rent because they’re sporadic, sparse and concentrated in certain areas by virtue of location or by virtue of the list price,” he said. “Typically, adequately listed units won’t see bidding wars, but coveted school districts could spark bidding wars if a house in a particular catchment becomes available.”

Dr. Haider surmises that, to some extent, fierce competition in the low-rise rental market has to do with York Region having more immigrant households than Toronto proper, and because some communities put such a premium on education that desirable catchment areas determine where they live.

“What I can comment is that in York Region—that is, the areas north of Steeles—there’s a higher concentration of immigrant families unlike the City of Toronto, which has a lower concentration of immigrant families, but when you have families that put a higher premium on education for their children, then location decisions are motivated by proximity to good quality schools.”

Although family-sized rental housing is a pressing issue, Lyall says creating sufficient supply of purpose-built rentals is a priority because that will keep rents in check, which would help families, especially those on the margins.

“We’re not building enough housing to meet our needs. Prior to COVID coming along, we had a serious housing supply deficit in Ontario of 25,000 units,” said Lyall, adding that price surges in the aftermath of the pandemic created an even larger pool of renters who couldn’t afford to purchase. “Demand for all forms of housing went up. In York Region, they don’t build enough purpose-built rental units, and half the people who work in York Region can’t afford to live there, for starters, and we’re grossly under supplying housing.”


The GTA real estate market has reached historic highs over the past year, with house prices in outer-lying cities seeing unprecedented surges in interest.

As homebuyers searched for larger spaces in more suburban areas of the GTA during the pandemic, it drove demand and, consequently, home prices through the roof.

A new report from RE/MAX found that detached homes in three unexpected GTA cities saw unbelievable growth between 2020 and 2021, rising over 40% in value.

Uxbridge experienced the largest growth, with detached home prices there increasing a whopping 46.4% to a new high of $1,365,983. It was closely followed by Scugog — directly to the east of Uxbridge — where prices jumped 43.9% to a new high of $986,878.

King, located just north of Vaughan, saw house prices rise from an average of $1,555,302 to $2,179,739 — a change of 40.2%.

Other outer-lying GTA cities like Brock, Pickering, Clarington, Oshawa, Caledon, East Gwillimbury, Whitby, Banbury-Don Mills, and Milton all saw substantial increases in detached home prices, each rising 34-40%.

This upswing in prices came alongside an upswing in the number of sales, the report says.

“Halfway into 2021 and the Greater Toronto housing market continues to fire on all cylinders,” said Christopher Alexander, senior vice president of RE/MAX Canada. “Overall home sales topped 70,000 between January and June, the strongest first half in the history of the Toronto Regional Real Estate Board, while values smashed through record levels set in previous years.”

With interest rates falling to a historic low during the pandemic, aspiring homebuyers raced to these once-more-affordable communities and pushed up the prices. In 2019, 28 GTA communities had average detached home prices under $1,000,000. In 2020, that number fell to 18. This year, there are only six.

“More transit options and hybrid work schedules have made relocation to the city’s outlying areas even more attractive,” said Alexander. “First-time buyers are feeling the squeeze but are still determined to become homeowners, with many happily travelling further afield to make it happen while working from home. The beneficiaries of the trend have been suburban communities in Durham, Peel, Dufferin County and the most northern part of York Region.”

And with low inventory levels not changing anytime soon, the trend of rapidly rising prices likely won’t either.

“Without a serious influx of new listings to ease the upward pressure on pricing in the coming months, the market will likely continue on this upward trajectory,” Alexander said.

Rising inflation is a growing concern, but real estate investors can rest assured that their investments are, at least for the time being, inflation-proof.

“Real estate has been protected from inflation since the 1970s but it won’t work if there’s anything extreme, if we go back to a 15% benchmark interest rate,” said Patrice Groleau, owner of McGill Real Estate and of Engel & Völkers’ rights to the Quebec market.

However, even if rates somehow surged into the double digits, the value of real estate is mostly tied to the value of land and the cost of construction, namely materials and labour, which rise commensurately with inflation.

After the subprime mortgage fiasco that led to the Great Recession, real estate in major cities like Miami and New York quickly returned to their base values, which Groleau noted is why investors always pounce on properties in the immediate aftermath of economic downturns. Nevertheless, under normal economic conditions, inflation increases slowly and is always matched by rents, offering property investors a measure of protection.

“Rents adjust to inflation. In Quebec, every time you have a rental increase, the government looks at inflation to justify that increase, and if the price of rent goes up, the value of the building obviously goes up too,” said Groleau. “The problem with monetary policy in Canada is most decisions are all based on inflation—the biggest concern for the government is always inflation, inflation, inflation, so as soon as inflation rises, you see a direct link to real estate. It’s not perfect but if you look at all other options, there’s almost nothing better than that. Stocks don’t even match inflation the way real estate does, unless they’re blue chips.”

Groleau added that two-thirds of a downtown property’s value is tied up in the land, with the remainder determined by material costs, while it’s the opposite in suburban markets.

It is highly unlikely that interest rates reach the double digits, at least any time soon. In Japan, for example, interest rates have been near the basement since the aughties and Groleau suggests that, with Canada following suit—many advanced economies have had declining interest rates for over two decades—real estate is one of the safest investments today.

“As Andrew Carnegie said, ‘90% of all millionaires became so through owning real estate,’” said Groleau. “It has a stable core value over time because everybody needs somewhere to live, and every study and financial professional I’ve spoken to says we will follow the Japanese model. People don’t think rates can stay low forever, but in Japan they’ve been low since the early 2000s and inflation is under control.”

Prime prices across 46 cities increased at an average rate of 8.2% in the year to June 2021, up from 4.6% in March.

What’s happened?

Until now, the pandemic-fuelled house prime boom was most evident in the mainstream market but the prime sector has now surged ahead.

The mainstream market now lags behind with prices across 150 cities increased by 7.3% on average in the year to Q1 2021 (latest data available).

The Prime Global Cities Index is a valuation-based index tracking the movement in prime residential prices across 45+ cities worldwide using data from our global research network. The index tracks nominal prices in local currency.

Toronto leads this quarter’s results recording annual prime price growth of 27%, driven by strong buyer appetite and low inventory levels. Despite a recent raft of cooling measures, the next three rankings are occupied by key Asian cities – Shanghai (21%), Guangzhou (20%) and Seoul (20%). Miami (19%) completes the top five this quarter.

Interestingly, the proportion of cities registering prime price growth has increased only marginally to 76%, instead it’s the scale of growth amongst the top-performing cities that is behind the index’s acceleration.

Last quarter, the top-performing city recorded annual prime price growth of 19%, three months on four cities exceed this threshold.

Other hotspots include Canadian and US cities which, on average, registered annual price growth of 16% over the 12-month period.

What’s driving prices higher?

Housing markets are undergoing the most unusual of recoveries. An easing of travel rules in some markets, a surge in safe haven purchases by domestic buyers, a flurry of activity ahead of the tapering of stamp duty holidays, and an overall reassessment of lifestyles and commuting patterns, all set against a backdrop of low interest rates.

Where next?

Talk of housing bubbles are grabbing headlines worldwide but we expect the prospect of rising interest rates, government intervention and the withdrawal of stimulus measures to rein in the market’s exuberance in the second half of 2021.

Expect more cooling measures as policymakers grapple with the affordability conundrum. The Chinese mainland’s long debated national property tax now looks more likely.

We expect to see London, New York, Paris and Dubai move up the rankings in Q3 as travel restrictions ease and international buyers start to recognise the relative value in these cities.

A Toronto neighbourhood could see massive changes over the next few decades.

More than 500 acres around Downsview Airport and Downsview Park are part of a planning process to develop residential and non-residential property called id8 Downsview.

Just as neighbourhoods around #Downsview were built over time, this plan will likely take 30+ years to fully implement. Our thoughtful, step-by-step approach prioritizes collaboration so decisions continue to be informed by priorities of the community, stakeholders & the City.

— id8Downsview (@id8Downsview) July 28, 2021
Northcrest Developments and Canada Lands, have named the planning process id8 (ideate) Downsview “because we know a lot of ideas will be shared and discussed between a lot of people to plan a future for these lands.”

The process began when Bombardier sold the Downsview Airport property to the Public Sector Pension Investment Board (PSP Investments – a federal Crown corporation that manages funds for the pension plans of the federal Public Service, the Royal Canadian Mounted Police, the Canadian Armed Forces, and the Reserve Force) in 2018.

Northcrest Developments was established a short time later to create a master plan and develop the Downsview Airport lands on behalf of PSP Investments. Downsview Airport is slated to close in 2023.

They hit a snag with some disagreement over rezoning employment lands as residential. Plans now state there will be a minimum 12 million square feet of non-residential space – including a recently announced film and television production facility.

Now id8 Downsview is preparing a proposal for the City of Toronto and is asking for feedback on plans for the property.

Developing this area will take 30+ years. We want this space to serve the community in the interim as well as in the future. What could we do with this space while planning is underway? Share your thoughts on our survey

— id8Downsview (@id8Downsview) July 27, 2021
An early vision for the property includes three new mixed-use neighbourhoods anchored by Downsview Park and the airport. Mid-rise buildings and taller buildings near transit are mentioned in the plans.

Planning this big area will take time and collaboration with the public, stakeholders & City. The early focus will be on 3 new, mixed-use neighbourhoods, anchored by #DownsviewPark and the runway. This will enable us to start close to transit and support the creation of new jobs.

— id8Downsview (@id8Downsview) July 24, 2021
Downsview Park won’t be cut.

“The size of the Park will not change and there will be additional green spaces added as we develop the neighbourhoods,”

There are also suggestions to include new parks, re-use heritage buildings, celebrate Indigenous people and reimagine the airport runway.

With the departure of Bombardier and the availability of the airport lands along with a TTC subway extension and GO service expansion — there is a potential for development.

This is just the first step in what is likely a multi-decade process of “re-imagining this area of Toronto.”

Activity is heating up in rental housing markets across Canada, a troubling sign for affordability in cities with a chronic shortage of available units.

For years before COVID-19, markets from Vancouver to Prince Edward Island suffered from an unrelenting mix of weak rental construction, raging demand and rising rates. Bidding wars were not uncommon, echoing the buyer’s market.

The pandemic offered a slight reprieve in many cities as vacancies climbed and asking rates fell, owing partly to a drastic slowdown in population growth as immigration waned.

But the reprieve is proving short-lived. The average monthly rent for units listed on was $1,721 in June, an increase of 2.7 per cent from April, though still lower than before COVID-19. Rents rose 2.5 per cent in May, the largest 12-month gain since early 2020, according to inflation data from Statistics Canada. During the six months prior, the average annual gain was just 0.8 per cent.

The coming months should see strong demand, as the country is poised for an influx of new immigrants, part of the federal government’s push to make up lost ground. And with universities set to resume in-person classes, more students are signing leases.

In effect, many cities are hurtling back to tight market conditions with meagre vacancies, putting a strain on tenants’ finances.

“We’re having an affordability crisis across the country, but especially in large urban centres,” said Ricardo Tranjan, a political economist at the Canadian Centre for Policy Alternatives.

In the country’s largest rental market, dynamics are shifting.

The average rent for available purpose-built rental units in the Greater Toronto Area was $2,289 in the second quarter, down 5 per cent from a year earlier, but up 1.9 per cent from the first quarter, according to real estate consulting firm Urbanation, which focuses on apartments completed since 2005. It was the first rent increase since the start of the pandemic.

In the condo market – a major source of Toronto’s rental supply – activity is hotter than ever. Over the past four quarters, there were 50,000 condo lease transactions in the region, up 58 per cent from the previous peak. Leasing is particularly strong in the downtown core.

“The [urban] exodus story is completely overblown,” said Shaun Hildebrand, president at Urbanation. “Now that things are reopening again, everybody’s coming back in.”

The GTA is on track to have vacancy rates and rents back to prepandemic levels by early next year, Mr. Hildebrand said. “Units are starting to lease in multiple-offer situations again. Rents are rising very quickly. There’s been a very dramatic reduction in available supply, just in the last several weeks. And the market is becoming very competitive.”

To lure new tenants in the pandemic, Canada’s major landlords ramped up their use of incentives, such as one month’s free rent, gift cards and signing bonuses. This allowed them to recruit tenants without lowering rates.

The use of incentives is still prevalent in the GTA. But in some other places, it’s waning. Boardwalk Real Estate Investment Trust said in May that it was pulling back on incentives in Saskatchewan, and was nearing that point in Alberta, owing to higher occupancy.

“As we head into our strong summer rental season, the occupancy and revenue trend for all our markets is positive,” chief executive officer Sam Kolias told analysts on a call.

The demand side should continue to strengthen. Immigration levels have perked up in recent months, and the federal Liberals aim to admit more than 1.2 million permanent residents between 2021 and 2023, ensuring a steady flow of new renters for years to come.

Given tight conditions and favourable demographics, Canadian apartment buildings have become an increasingly attractive asset class, sought after by global players in billion-dollar acquisitions. Development is quickly growing, too: Around 60,000 purpose-built units were completed last year, the highest since at least 1990, according to the Canada Mortgage and Housing Corp.

The trouble is that supply isn’t growing nearly enough, industry executives say.

“We’re calling for increased immigration numbers – unprecedented, never-seen-before immigration numbers – going forward. So the fundamentals are just incredible,” Mark Kenney, CEO of Canadian Apartment Properties REIT, told analysts on a May earnings call.

“Without meaningful housing policy to accelerate the development of rental, I think that we’re going to find ourselves in this supply-constrained environment,” he added.

The pandemic didn’t necessarily bring relief to many renters, the CCPA’s Mr. Tranjan noted. Most tenants stayed in their units, and likely saw their rents hold steady or rise slightly. And while asking rates often fell, a tenant’s new unit might still be pricier than before.

“To call it a renter’s market was a long, long stretch, and fairly inaccurate,” he said.

For renters, the other option is home ownership. But on that front, affordability has deteriorated. Fuelled by rock-bottom interest rates, buyers have purchased homes in record quantities and driven up prices. The average national sales price was around $680,000 in June, a 26-per-cent gain from a year earlier. Six-figure price increases have not only taken hold in major markets, but in bedroom communities and rural areas.

“The rental market is going to become increasingly more important as ownership affordability continues to erode,” Mr. Hildebrand said. “That’s just going to shut out more first-time homebuyers in the future and put further pressure on the rental market.”

Condo prices in the Greater Toronto Area are on an upsurge, rising 44% since the 2017 housing peak, driven by the segment’s relative accessibility compared to other property types, recent data from tech-enabled brokerage Properly has revealed.

“This past year, condo sales were hit the hardest by the pandemic,” said Anshul Ruparell, co-founder and chief executive officer of Properly. “While sales are now back up to pre-pandemic levels, it’s relieving for condo owners to know that their investments have appreciated significantly over time. Moving forward, it’s forecasted that solid growth in condo sales will continue as pandemic restrictions ease.”

For perspective, the historical average condo appreciation rate in Toronto before the coronavirus outbreak was between 4% and 5% annually.

A separate analysis by Zoocasa, meanwhile, found that month-over-month price growth was strongest in the 905 area, with Simcoe County (56%), Durham Region (46%), and Halton Region (26%) posting the largest gains. Average condo prices in the city of Toronto stood at $716,976 in May, representing a 17% jump from the previous month.

Zoocasa attributed the increase in condo values to Canada’s march towards a full economic reopening and May’s 170% annual spike in sales activity.

“As vaccines roll out and pandemic restrictions ease, it’s clear buyers are once again interested in high-density living at the heart of it all,” the real estate and brokerage website said.

Why are Toronto condo investments a good idea?
This price surge, along with a combination of the abovementioned factors, is what makes condo investments, particularly in the 416 area, sensible in an “economical point of view,” according to Toronto-based real estate agent Pierre Capaterian.

“When it comes to investing in Toronto real estate, the condo market is where the biggest gains are. Toronto condo prices have gone up an average of 13% per year since 2015,” he wrote in a blog post. “With Toronto’s average 10-year historical growth rate of 5% a year and the most recent years averaging over 10% a year, investing in the Toronto condo market in 2021 means you’ll get in at today’s rates.”

Capaterian added that Toronto has become an “evolving world-class city,” joining the likes of New York, San Francisco, and London, but with property values still way below those cities.

He then laid down three reasons why it is a good idea to invest in Toronto condos:

1. Equity gains
Access to high equity gains is among the biggest reasons why Toronto is a prime location for condo investment, according to Capaterian. He cited the Toronto Regional Real Estate Board’s (TRREB) February 2021 data, which showed condo prices in the 416 area rising by 52% since 2015.

“To put that in perspective, if you had purchased a condo in 2015 for $400,000, you would have made over $200,000 (or $50,000 per year) just by living there,” Capaterian wrote, adding that while investing in Toronto real estate “can be very fruitful, it requires a ‘proper investment strategy’.”

2. Stable rental demand
While the pandemic has dampened rental demand in the city, Capaterian believes that the impact is temporary and the demand for rentals remains stable.

“With college students returning to school and immigration expected to reach record-breaking levels, we anticipate stable but increasing demand for rental inventory,” he wrote. He added that major developments, such as the East Harbour, and the growing number of high-profile tech companies “choosing to set up shop” in Toronto will push up demand further.

“Pair that with Toronto’s record high rental rates – one-bedroom condos currently rent for about $2,225 per month – and your tenant can help pay down your mortgage,” he wrote.

3. Stringent lending practices
Toronto’s delinquency rate – mortgage left unpaid of 60 days or more – is also considerably low, according to Capaterian. In the past year, the figure has dropped to 0.56%, indicating how property buyers in the city are “well-funded.” He added that the government’s recent raising of the stress test threshold can help ensure that buyers “are not overleveraged to the point where changes in rates or the market causes them to have to dump their assets and take a loss.”

What are the keys to finding the best condo investment?

“It’s not about buying one thing; it’s about buying the right thing,” Capaterian wrote. He listed several signs that a condo is a good investment, including:

  • Units that are priced below what other properties in the area are trading for
  • Units located in gentrifying neighbourhoods where prices are low but are on the rise
  • Future developments or transit infrastructure that will add value in the years to come
  • Resale condos that are known to perform well in the market

Capaterian also emphasized the importance of buying strategically.

“Don’t be misguided by condo developments that seem juicy because they’re along the waterfront,” he wrote. “You’re looking for condos with the best margins and they can be found both in the resale condo market as well as the pre-construction market.”


He also noted the value of working with an experienced real estate agent, adding “when it comes to the resale market, having an agent who knows which buildings and floor plans yield the better ROI [is an advantage]. With regards to pre-construction, you need an agent who has platinum access to projects throughout the city. This gives you preferential access to the best floor plans and the lowest pricing available.”


Capaterian added that the best condos in Toronto often never reach the open market as seasoned agents and their clients snap them up during the platinum phases. This is the reason why working with an agent who has deep knowledge of the developments in the city is a must in securing the best investment property.