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Toronto Rental Cost (& AirBnB) Issues

We need to distinguish between what is the real estate free market and what is subsidized housing.

Supply and demand will always determine pricing, and having the government try to make private landlords into quasi social workers is simply pawning off their responsibilities. They don't have the guts to raise the revenue to build the proper government subsidized housing for those who need it and are trying to get the private market to do it for them by forcing below market rents on them. The result is the rental market is a mess and so is affordable/subsidized housing.
Plus allowing these massive condo developments of which the majority become rental - small units with big rents. But of course more units = more money for the city which is what the city wants
Plus allowing these massive condo developments of which the majority become rental - small units with big rents. But of course more units = more money for the city which is what the city wants

Well actually, the City would make more from commercial multi-res rental buildings. But the gov't has made that business unattractive, which is why purpose-built commercial residential rental buildings have for the most part, not been built in decades.

Condos do not make for a stable, reliable rental housing stock. And they are also almost never professional landlords. Condo buildings that mix owners with short term renters makes for a tenuous environment. This problem is just going to get worse as individually owned condo units make up a larger a larger portion of the rental housing stock.
Program by the Planning department to streamline development of rental properties:
jennifer keesmaat‏@jen_keesmaat said:
Toronto's program to incentivize affordable rental housing: activating public land, streamlining approvals Of Toronto/Affordable Housing Office/Shared Content/pdf/OpenDoorGuidelines F.pdf

Another note on supply:
jennifer keesmaat‏@jen_keesmaat said:
Toronto has more than a 3 year supply of units that could commence construction in the next 1 to 3 years, *already approved.* #MythBusting
I wonder if these purpose built rental buildings will give potential condo investors pause for concern. As more and more rental buildings go up, provides competition for the condo units.

I don't think so. It is good to see that there will be more rental buildings getting built. It's about time.
Not sure what they're thinking. This is only going to exacerbate the current rental unit shortage. They should be starting with an extra property tax on vacant units.
Not sure what they're thinking. This is only going to exacerbate the current rental unit shortage.

Of course it will. But that was intended as a political jab only.

It isn't that difficult to figure out:

The landlord business is market's part of the free market.
People that can't afford to pay market prices for a free market rental should then be subsidized. And subsidizing is the job of gov't...not the free market. Trying to make free market landlords quasi social workers will just end up with everyone suffering...throwing the baby out with the bath water.
They should be starting with an extra property tax on vacant units.

Over 3 or 4 years old. Shorter than that and landlords won't want to risk new construction as markets can change quite a bit between when construction begins and when occupancy happens.

Or, if they do start, they'll sit on a building that's partially finished but not ready for occupancy until the market improves enough they know they can fill 95% of the units.
Ontario housing minister vows to boost rent control after CBC Toronto tenancy series

Minister Chris Ballard says he's 'absolutely' open to revisiting so-called 1991 loophole

It all sounds like early campaigning to me.

What does "revisiting" mean? Could mean visit...and change nothing. he he

If they decide to apply the same controls as they do to pre 1991 rental units, then it is not going to create more supply by making it less attractive as a business. That's not solving anything.

Also, the vast majority of rental units in the post 1991 inventory are not purpose-built rental buildings, but individually owned condos which can be sold at any time and tenants evicted or owners can move in and tenants evicted. They also tend to be units with high turnover rates, rather than long term tenants like in the old rental buildings (which have lots of tenants paying below market rates because of the two-tiered system). So it will not have the same desired effect as the pre 1991 units.

With a 1% vacancy rate, obviously, the post 1991 condo rental market isn't overpriced. What to do with those that won't/can't pay these prices? Subsidize them by providing gov't housing or gov't cheques to supplement their housing. But it's more politically valuable to get the free market to do their jobs for them.
Precarious housing means thousands may live on brink of homelessness
136K renter households pay more than 50% of income on rent, utilities

Ontario needs a rental rethink, but should tread carefully

OPINION: The minister of housing says he’s looking at changes to Ontario’s rent control law — something the province sorely needs — but shouldn’t be tempted into election-season overreaction
Don't let the headlines take your eye off the ball.....Toronto doesn't have a housing crisis (the housing market is very healthy)...Toronto has a social assistance crisis. Whose job is it to manage that...private landlords? Nope.

Also, individuals have to take some responsibility and act a little less entitled. If you can't afford to live in the city, what are you doing here? I'd love to live in Monaco, but rather than ask the private property owners to subsidize my lifestyle, I simply decide to not move there.
Rent asunder: Landlords using evictions, hikes to circumvent rent control, Toronto tenants say
A growing number of tenants say their landlords are forcing them out to charge higher rent, according to data from Ontario’s rental-dispute board. Jeff Gray and Tom Cardoso investigate


A Globe and Mail analysis of data from Ontario’s Landlord and Tenant Board, which adjudicates disputes, found that the number of applications for evictions such as Ms. Golkar’s has shot up 23 per cent since 2013 as tenants’ advocates say some landlords try to take advantage of the city’s competitive housing market.

The data also show a large increase in the number of landlord-tenant disputes over “above-guideline” increases, which are allowed for rent-controlled apartments after landlords do renovations or upgrades.

Disputes over evictions for simply failing to pay the rent have actually declined.

The numbers starkly illustrate the pressures created in a record-tight rental market that’s being made even tighter, observers say, as many Torontonians give up on buying a home of their own and choose to rent because of skyrocketing real estate prices.

Vacancy in Toronto is low, at just 1.6 per cent, and about 45 per cent of households are renters. The province’s rent-control regime, which is supposed to keep rent increases for current tenants at the rate of inflation, applies only to buildings constructed before November, 1991, after amendments made in the late 1990s by then Ontario premier Mike Harris that were meant to spur more rental construction. Even in rent-controlled buildings, once tenants leave, rent can be set at a much higher rate for new occupants.

Exactly how many tenants in rent-controlled apartments face eviction by landlords using false pretenses is impossible to measure. Even the Landlord and Tenant Board numbers are not broken down to show precisely how many disputes of this kind make it before the board.

The majority of applications the board receives in any given year are regarding the eviction of a tenant for non-payment of rent. In 2016, 72 per cent of all landlord applications were for this category.

But the number of hearings over evictions in the board’s “other” category – which includes evictions based on a landlord’s intent to occupy the place but also encompasses evictions for tenants who have damaged property, caused “serious problems” or overcrowded their units – has shot up in Toronto since 2012. There were just 1,740 such cases filed with the board that year. Four years later, in 2016, that number had risen to 3,054.

Disputes over above-guideline rent hikes also shot upward during the same five years, from just 91 in Toronto in 2012 to 198 last year. In both cases, the data present just a sliver of what is happening in the marketplace, as many such disputes never make it before the board.

Meanwhile, non-payment-of-rent applications have decreased over the same period.

Several renters who responded to a Globe online survey about their experiences in Toronto’s tight market also complained that they suspected their landlords had faked an intention to move in to try to get rid of them.

Geordie Dent, executive director of the Federation of Metro Tenants’ Associations, said his organization has actually seen a decline in calls from tenants concerned about being evicted over not paying the rent, reflecting the strengthening of the economy since the financial crisis nearly 10 years ago. But he said calls about landlords threatening to sell or to move in and evict tenants have been rising.

“What we are seeing from our call volume is landlords wanting to cash in on the hot rental market,” Mr. Dent said. “You’re seeing more and more landlords saying, ‘Oh yeah I need to move into the place.’ And it’s totally bogus.”

It is even worse in buildings not subject to rent control, where tenants are unprotected from what in some cases are double-digit increases. In the city’s rental-condominium market, most of which are post-1991 buildings not subject to rent control, rents shot up 11.7 per cent in the fourth quarter of 2016 over the same period a year earlier, according to a report by consulting firm Urbanation Inc., while the number of listings sank.

Some condo renters face even steeper hikes. Heather MacDonald, 26, who works in advertising, was forced to leave a 400-square-foot $1,400-a-month Liberty Village condo after a new landlord demanded another $300 in rent: A 21-per-cent hike. She found a bigger rent-controlled apartment nearby.

“My concern is that there’s a lot of landlords and property developers who are able to do this to single parents and new immigrants who aren’t able to luck out like I did,” Ms. MacDonald said. “It was a very trying situation to all of a sudden be uprooted.”

The Ontario government has said it may announce changes to rent controls as part of a review of the current regulations, but has not revealed what reforms are being considered. A private member’s bill from NDP MPP Peter Tabuns recently called for the exemption of post-1991 buildings from rent control to be scrapped. The Liberal government has also floated loosening some rules on landlords, such as making it easier to toss out tenants with troublesome pets, in an effort to get more homeowners to rent out parts of their houses and increase supply.

John Plumadore, president of the Brentwood Towers Tenants’ Association, a rental complex popular with seniors near Yonge Street and Davisville Avenue, says the building’s landlord has for years routinely asked residents for above-guideline rent increases, after doing work on the underground parking garage and elsewhere.

Some seniors on fixed incomes have been driven out by the increases, he said. And the new younger professionals that are moving in are paying much higher rents.

Mr. Plumadore, who is chairman of the Federation of Metro Tenants’ Associations, argues that improvements to the buildings, which increase their value, should be paid for by their owners, not the tenants.

Most of the time, he said, his landlord, a company called O’Shanter, lowers a demand for a rent increase after a mediation session with the tenants’ association. But residents can still end up seeing a 3-per-cent hike in the typical year, he said. (He adds that, despite this, he considers O’Shanter a good landlord over all.)

“The seniors say, we want to pay our way, but we don’t want to be gouged,” said Mr. Plumadore, a retired senior Scouts Canada official who has lived in Brentwood Towers for a decade. “The [increases] are killing us, because those of us who have lived here a long time, we like our building, we like our neighbourhood.”

Jonathan Krehm, a co-owner of O’Shanter, which has owned Brentwood Towers for more than 30 years, argues the increases are justified as landlords seek to repair aging buildings.

He said landlords are now being forced by safety authorities to install expensive new elevators across the city, for example, and should be entitled to recover those costs. Water and electricity bills have shot up in recent years, he said, and are grounds for allowable above-guideline increases. (He said any landlord who lies about intending to move into a unit has “no excuse for acting illegally or dishonestly.”)

But Mr. Krehm warned that more increases are coming to his tenants this year: He plans to seek “extraordinary” rent hikes to recover the costs of the city’s new landlord licensing fee, which is expected to cost $10.60 a unit.

“The biggest villain here is the City of Toronto, who discriminates against rental housing” by taxing it at about three times the rate charged to condos or single family homes, Mr. Krehm said. “If people were really concerned about the cost of rental housing for people who couldn’t afford it, they’d make the tax system equitable.”