The current problem of increasing rental rates

Analysis of the causes and consequences of rent increases in Toronto

by Polina Pavlytska

Tuesday, December 12, 2023

In recent years, Toronto has seen a rapid increase in rental prices.This increase in rental
rates not only has a negative impact on the financial condition of residents, but also affects
the stability of the housing market.

The analysis of rent increases looks at the reasons for this, including economic and social
factors, and examines its impact on the housing market. And also what consequences this
phenomenon brings with it. This problem has a very large impact on society. The main
emphasis is on the need to establish partnerships in which both residents and tenants can
engage in constructive dialogue and jointly seek optimal solutions. Since interests most often
diverge, many disputes arise on this issue.
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One of the main reasons for rising rents in Toronto is rising property values. The city's
economic development and influx of new residents are increasing the demand for housing,
causing prices to rise. In 2018, the Ontario government took a step in an attempt to address
the shortage of purpose-built rental properties. Immediately after winning the election,
Premier Doug Ford lifted rent controls on all apartments built or occupied after November 15
of that year, saying the move would provide "market incentives to increase supply."

Toronto has experienced significant population growth due to both international migration
and domestic factors. And this is why a limited supply of housing compared to demand can
lead to increased competition among tenants, which will force landlords to raise rents.

In successful and vibrant Toronto, where skyscrapers dot the skyline, somewhere in the
inner city, in cramped living quarters, there is silence about families balancing in the face of
rising rents, sacrificing everything for the illusion of stability.

The areas are full of life, but there is a sense of uncertainty in the environment. Parents work
multiple jobs, children grow up in confined spaces, and it's all at the mercy of the rental
market.

When it comes to rising rental prices in Toronto, expert opinions highlight multifaceted
factors. Renowned real estate economist Dr Sarah Johnson cites rapid population growth,
coupled with limited housing supply, as the main driving force behind rising rents in the city.
Housing policy analyst Dr. Mark Thompson highlights the unintended consequences, noting
that recent changes to rent control policies are driving up prices in certain segments of the
Toronto market. Mary Rowe, CEO of the Canadian Urban Institute, emphasizes the
importance of not only the number, but also the type and location of housing developments,
offering a holistic view of the problem.
I believe that the presence of legislation regulating rental rates could help prevent rental
prices from rising too quickly. Also, the situation could be saved by starting the construction
of different types of housing, for different categories of people's income. A good idea would
be to introduce subsidies for the construction and maintenance of social housing.

I think that changes are necessary in this situation because the situation will worsen over
time and it is necessary to take action now.