The multifamily market in the Greater Toronto Area (GTA) experienced positive developments in Q2 2023 with increased transaction volume and strong rental market growth. Although the market holds a promising long-term outlook, prices remain lower compared to this time last year.
- Transaction volume increased by 10% compared to this time last year, reaching a peak of 22 transactions, indicating a slight resurgence in the market.
- The average price per suite in the GTA during Q2 2023 was $325,589, closely aligning with the average price reported at the end of 2021, but representing a 9.6% decrease compared to the price per unit last year.
- The Government of Ontario announced a 2.5% annual rent increase guideline for 2024 mirroring the rent increase guideline established for the current year.
- Financing costs have seen a significant shift, with the Canada Mortgage Bond 5-year rate increasing from 2% in January 2022 to 4.18% currently, impacting cap rates significantly.
- Private buyers have emerged as the dominant force in the multifamily market, while institutional purchasers have become more selective in their investment choices.