The cost of rent in downtown Toronto is now cheaper than elsewhere in the GTA

Last year was an understandably strange one for Toronto real estate, with home prices continuing to skyrocket despite the pandemic while rent prices did the exact opposite.

The two markets saw vastly different trends in 2020, with high demand and competition leading to bonkers sales volumes in the housing market, and a glut of former Airbnbs coming onto the long-term rental market and lowering average prices — so much so that it's actually more expensive to be a tenant in other parts of the GTA than it is in Toronto proper right now.

The average rent price over time in Central Toronto vs. Toronto vs. the GTA, from Realosophy.

As new data from Toronto real estate company Realosophy shows, the average cost of renting a home in Central Toronto dropped to $2,132 in December. This is compared with a slightly higher $2,152 for Toronto as a whole and $2,227 for the GTA.

This put Central Toronto rents down more than 18 per cent from the same time in 2019 —  a more substantial drop than the GTA, where rents fell 9.75 per cent year-over-year.

Experts from the firm also looked at what they call a "price-to-rent ratio" in both areas, which compare how expensive homes are compared to rent. For Toronto, this number was 32, and in the GTA, it was 30, indicating a greater disparity between the buying and renting markets.

The change in average rent price over time in Central Toronto vs. Toronto vs. the GTA, from Realosophy.

Factors contributing to this pattern aside from the flailing condo market in Toronto include people vacating the city and heading to surrounding suburbs amid work-from-home orders and lockdown closures.

There is also the fact that online learning has meant no international students moving into the city last fall, on top of low immigration rates during the health crisis.

It's definitely somethin new for the region, in which prices have always been higher in the downtown core, as they tend to be around any major city. 

As Realosophy President John Pasalis said in a tweet on Saturday, he "never thought [he] would see this."