Toronto's booming condo market will play savior for a growing class of young adults seeking to rent property longer than ever before, according to Canada's national housing agency.
A report released by the Canada Mortgage and Housing Corporation suggests the Greater Toronto Area will soon be hit by the largest group of prospective renters, as those aged 25 to 34 move into the market.
But unlike generations before them, that group of cohorts is expected to overrun the rental market as they chose to put off purchasing homes of their own.
With rental units only attributing for 10 per cent of new apartments being built, the CMHC says the market will need to rely on condominium buyers to put their property up for rent.
"The rising supply of condos also plays a critical role in satisfying rising demand for rental accommodations," according to the report.
"About one quarter of newly completed condos are added to the rental pool, which has been expanding as condo completions are on track to hit a new record this year."
The condo rental supply is expected to continue growing as more complexes are built and investors actively put their units up for rent.
While home construction is expected to drop by 10 per cent next year – from the 29,000 built this year to 25,000 in 2012 – construction of multi-family dwelligns such as condominiums will remain strong. Some 18,000 condo units are projected to be built in 2012.
The CMHC says at this time next year, the rental vacancy rate will be two per cent, only a slight change from today's 1.9 per cent vacancy rate.
The average cost of a two-bedroom rental apartment in the Greater Toronto Area will increase to $1,165, from $1,134 today.
