Industry groups urge government to prioritize purpose-built rentals to tackle housing deficit
A new report by the Building Industry and land Development Association (BILD) and the Federation of Rental-housing Providers of Ontario (FRPO) has warned of a concerning shortage of rental housing in the Greater Toronto Area (GTA). The report estimates that the deficit of rental housing supply in the GTA will double in the next 10 years to 177,000 units, putting pressure on the city’s housing market. The organizations are urging the government to implement policies that stimulate the development of purpose-built rental (PBR) housing to meet the growing demand.
Purpose-built rental units represent approximately a seventh of all the housing stock available in the GTA, but only slightly less than half of the number of units available for rent. The region’s stock of PBR housing is aging, and the new supply is coming to market at much lower levels than other forms of housing. Almost 90% of the GTA’s purpose-built rentals date from more than 40 years ago, between 1960 and 1979, with only about 23,590 purpose-built rental units built between 2000 and 2022.
The report highlights that building purpose-built rentals, especially in major cities in the GTA, is more expensive for developers than other forms of housing because of the higher capital investment required and longer wait for profitability. The report calls on all levels of government to prioritize new purpose-built rental housing and create a policy regime that stimulates PBR supply.
Tony Irwin, President & CEO of FRPO, said, “In order to tackle our housing crisis, we need to build much more purpose-built rental housing, faster. The majority of Ontario’s purpose-built rental housing stock was built before 1980, so new units are essential to provide more choice and take the pressure off aging units. We are calling on all levels of government to make new purpose-built rental housing a priority and to create a policy regime that recognizes the unique nature of this type development and stimulates the addition of PBR supply.”
Read the full report, “Purpose-Built Rental Housing in the Greater Toronto Area”