Downtown Condo Lease Activity Reaches a Record High

The GTA rental market recovery began in Q2 with a surge in leases, reduced vacancy, and an increase in rents as lockdown measures began to ease.

Remarkably, downtown Toronto led the growth in rental activity in Q2 as the mass vaccination rollout and gradual reopening of the economy during the second quarter combined with attractive rent discounts to bring renters flooding back into the core.

Condos Rents Post Strong Increase from Q1 as Lease Activity Reaches a Record High

• The number of leases signed for condominium rentals in the GTA more than doubled from a year ago, surging 108% to 12,747 units — the highest Q2 level on record.
• Over the last four quarters, condo lease transaction activity reached an unprecedented 50,004 units, which was 58% higher than the pre-COVID peak of 31,696 units leased in the four quarter period to Q1-2020.
• Demand in the latest quarter was driven largely by the downtown market, where the number of new leases signed grew 129% year-over-year in Q2 indicating a migration of renters back into the core.

Are Renters Seeking More Space Coming Out of the Pandemic?

• Renters have remained budget conscious during the initial stages of the market recovery and haven’t necessarily been seeking more space coming out of the pandemic. Studios, which experienced the sharpest drop in rents during COVID-19, recorded the strongest annual growth in lease transaction volume of 154% in Q2.
• More generally, the smallest condo rentals under 600 sq.ft. represented a record high share (36%) of units leased in the second quarter. As a result, the average size of a condo unit leased in Q2 fell to a record low of 695 sq.ft.

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