Toronto Multifamily Market Report
Demographic Tailwinds Support Positive Outlook,
Despite Elevated Levels of New Supply
Healthy population growth aids performance. Toronto’s multifamily sector experienced a historic year in 2022. The metro’s vacancy rate fell 300 basis points to 1.6 per cent, helping annual rent growth surpass 6.0 per cent. This robust performance was a byproduct of record immigration, as well as a growing number of individuals finding themselves priced out of Toronto’s housing market. Looking forward, this healthy demand is likely to continue throughout 2023. Canada expects to welcome 465,000 new permanent residents this year, a 4.5 per cent increase when compared to last year’s historic level. Typically 40.0 per cent of new residents arrive in Toronto, further supporting ongoing apartment demand as new immigrants tend to rent before entering the ownership market. Additionally, with university enrollments surging — especially for international students — Toronto’s post-secondary institutions are struggling to accommodate. This results in higher demand for rentals. Consequently, vacancy is expected to continue to trend down, which should support further rent growth.