February 07, 2023
Real Estate News
RYPM
As Ontario struggles with a significant undersupply of
housing, investors are holding onto a marked share of condominium apartments
across the province.
According to newly-released data from Statistics Canada
(StatCan), investors, including landlords, short-term rental owners,
businesses, and developers, accounted for 41.9% of the condos owned in Ontario
in 2020. In the City of Toronto, investors made up 36.2% of condo owners.
Businesses owned 74,485 condo apartments for investment
purposes, or 13.4% of the property type, in Ontario. However, at 22.4%, the
majority of condos used as an investment were owned by in-province investors,
like landlords. Non-resident investors accounted for 5.6% of condo owners.
The StatCan report looked at the proportion of investors
among homeowners in five provinces, which, in addition to Ontario, included
British Columbia, Manitoba, New Brunswick, and Nova Scotia. Of all the homeowners
in Ontario, 20.2% were investors. The figure was highest in Nova Scotia, at
31.5%.
Across all five provinces, 918,695 houses were used as an
investment, of which 584,615 were in Ontario alone. As with condos, in-province
investors accounted for the highest proportion of owners, at 10.9%, while
out-of-province investors made up just 0.3% of owners. The latter figure is
likely due to higher real estate prices, StatCan noted.
Properties located outside CMAs were more likely to be used
as a secondary residence or a recreational property, like a cottage, when the
owners resided in the same province. Having a pied-à-terre in the city as a
secondary residence was less common, the report found.
In the Toronto CMA, which stretches east to Ajax, west to
Milton, and north to Georgina, investment properties – both condos and houses –
were concentrated in the downtown core.
While the proportion of investment properties in the CMA as
a whole was 16.3%, in the City of Toronto it was 21.7%. This amounts to 112,220
condo apartments and 52,935 houses being used as an investment in the city in
2020.
“When properties are owned by investors, they can contribute
to the rental housing supply — and therefore meet the population’s need for
rental housing,” the report noted. “But that can also limit the number of
properties available to buyers who intend to use it as a primary place of
residence.”
According to the latest census data, homeownership rates in
Ontario declined by 3% from 2011 to 2021, while renter households grew by
25.1%.
On a provincial level, Ontario had the second-highest rate
of unaffordable housing in 2021, at 24.2%. Toronto had the highest rate of
unaffordable housing of any CMA, at 30.5%
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