Midtown tenants struggle to compete in an unforgiving rental market
Low vacancy rate and rise in average monthly rent a concern for residents
Self-proclaimed YIMBY Chris Spoke is calling for more development and purpose-built rentals at Yonge and Lawrence
Tessa Williams, a 24-year-old freelance illustrator from Toronto, went apartment hunting in the Yonge Street and Eglinton Avenue area earlier this year. She was willing to pay as much as $2,000 a month, but despite her decent credit score, letter of recommendation and first and last months’ rent, the large pool of applicants competing for a one-bedroom unit in the area made it impossible to lock a place down.
“I had enough money for an apartment, but I don’t think my application was competitive enough,” said Williams.
She was turned down on multiple offers and was forced to settle on an apartment in the Dufferin Street and Dundas Street West area.
Williams is not alone in her frustration. A report presented at the City of Toronto’s Tenant Issues Committee in February states the average monthly rent of all units in Toronto has climbed to $1,829, based on analysis of available rental listings in September 2017. The vacancy rate for purpose-built rentals was shown to be down to one per cent, the lowest it has been in 16 years.
Chris Spoke, co-founder of Housing Matters — a “yes in my backyard” (YIMBY) pro-development group representing tenants across the city — argued Toronto needs more social housing as well as affordable market housing for those traditionally considered middle-class. He suggested supporting purpose-built rentals as part of the solution.
“We have a lot of new people moving to the city, and we’re not building enough new stock to keep up with it. The bargaining power shifts totally in favour of landlords who are then able to hike rents. As a tenant, you take what you can get because there is a lineup of people who will take it if you don’t,” said Spoke.
According to both Williams and Spoke, offering more than first and last months’ rent or attending open houses for rental units with a year’s worth of post-dated cheques and letter of employment are common tactics tenants are taking to get an edge on the competition.
As a result of the current climate, Housing Matters has supported several controversial development proposals in midtown, including the two towers for 18 Brownlow Ave., the four- to five-storey building at 41 Chatsworth Dr. and the 13-storey building at 2908 Yonge St. Spoke also supports the eight-storey building proposed for 321 Davenport Rd., the same development Margaret Atwood opposed publicly, which in turn branded her a NIMBY (“not in my backyard”) among critics.
“If these projects [high-end rentals and condos] don’t get approved and don’t move forward, those people then start bidding on the existing stock of more affordable housing,” he said.
Councillor Joe Mihevc, of Ward 21, St. Paul’s, argued supply is only part of the problem and is calling for more provincial legislation that increases rent control.
“Of course we need more supply out there, but increasing the supply alone is not the solution,” he said. “A good healthy vacancy rate is three per cent, and after that it’s a renter’s market not a landlord’s market. Once you hit three per cent, developers stop building rentals [because profit margins decline].”
Although the Province of Ontario’s new inclusionary zoning plan demands up to 10 per cent of units in each condo development be sold as affordable housing, a report by City of Toronto Planning staff notes the plan “fails to provide the opportunity to create much needed affordable rental housing.”
Linda McCarthy, who sold her home in Leaside and now rents an apartment in Lytton Park, had hoped the inclusionary zoning plan would offer relief to renters but argued it doesn’t go far enough.
“That’s a disaster for us,” she said. “I’m a senior citizen, and I’m on a pension, and it’s going to get to a point where I’m not going to be able to afford to stay here anymore.”
City council agreed with the report’s recommendation and on Feb. 1 requested that the province amend the plan to provide opportunities to create new affordable purpose-built rental housing.