With the cost of rent increasing in an already competitive market, tenants face mounting hurdles to secure shelter that fits their needs and budgets.
According to Capital Current’s data analysis from Statistics Canada’s Consumer Price Index (CPI), rent prices in Ontario rose by 7.1 per cent in August 2024, compared to the same time last year. The increase for all items over the same period tracked lower at 2.1 per cent.
For Marly Johnson, 24, these rising costs are an ongoing concern. Johnson rents a two-bedroom apartment above a hair salon in Ottawa with a roommate to help manage her $1,900 monthly rent. She works two jobs, all while applying for grad school, to cover her living costs.
“If I were to move, I would have to pay more – a lot more – and that stresses me out,” Johnson says. “I want to do more with my life, but I can’t. I should probably just stay in this apartment here cause that’s what I can afford and do for myself right now. But it’s not what I want.”
“I feel stuck,” says Johnson.
Francis Cortellino, an economist with the Canada Mortgage and Housing Corporation (CMHC), says the big difference in rent increases between long-term and new tenants creates a major issue for renters trying to move.
Cortellino says that Ottawa renters who moved last year were paying nearly 16 per cent more than those who chose to stay in their unit. This is because Ontario’s rent increase guidelines caps rent increases for existing tenants at 2.5 per cent, while landlords can charge higher prices for new tenants.
Even as landlords leverage the tight rental landscape to impose maximum guideline increases, Cortellino says most renters opt to stay where they are regardless of new supply hitting the market.
“Although rental starts are increasing, the demand is so strong that the vacancy rates remain only at two per cent,” he says. “For tenants with lower income who want to move, it means that they don’t have a lot of options because those new rental units are more expensive. People can’t afford to go in those types of units.”
The lack of movement in the rental market has trickled down to renters, particularly students, trying to get into their first unit.
Hannah Semple, a third-year student at the University of Toronto, has tried to apply for residence for all three years but has been unable to get a spot for the last two years. Since the lottery-based system is a hail mary for students trying to find housing, she had to look for a place.
“Last year I lived with two people. We got a basement apartment, a half-hour commute from downtown, and it wasn’t the best,” Semple says. “It wasn’t up to code.”
“The ceilings are too low, the rooms aren’t legally big enough to be bedrooms, we had mice,” Semple says.
Before Semple stepped foot in her less-than-ideal unit, she says finding a place was more stressful than ever. “It was like a full-time job,” she says.
Ella Smith lives in Mississauga and has also been finding it difficult to get her foot in the market. She says she has seen more than 100 applicants online for a single rental listing.
"[Landlords] are going to go through their first 10 and find their person," Smith says. "I find it's a lot of speed now."
Smith says that the competition in the rental market has made transitioning from student residences difficult since her lack of renting background places her in a lower standing than other prospective renters.
“You don’t have a rent check account where they can check what kind of tenant you are,” Smith says. “They have no proof or trust in you, and you have to find where you can.”
Cortellino says that while the increase in rental starts is good news for the market, high mortgage rates and population growth will keep rental demand competitive. He says he expects the market to remain challenging for renters.
“As long as low vacancy rates remain stable, so will rent increases,” Cortellino says. The CMHC is in the process of completing its rental market survey and will publish the results at the end of the year.
For renters like Marly Johnson however, the future remains more unclear.
“I would not be able to afford a one-bedroom by myself unless I change jobs and make more money,” Johnson says. “At times I think, maybe I should just go back to my parents’ house. I would save so much money that way.”
