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Statistics Canada’s recent data highlights the significant role of investors in Canada’s rental market, particularly in the condominium sector. Between 2016 and 2022, an increasing number of condos are investor-owned, with 38.9% of all condos in the Toronto Census Metropolitan Area (CMA) owned by investors in 2022, and that figure rising to 56.3% for units built during that period. These investor-owned condos are essential in providing rental options amid a shortage of purpose-built rental properties, with approximately 40% of Toronto's condos being investor-owned and likely available for rent.

The data suggests that most investor-owned condos are occupied, contradicting narratives that investors are preventing first-time homebuyers from entering the market. The City of Toronto reported only 11,000 vacant homes, indicating that a substantial number of these investor-owned units serve as rental accommodations. While there is a trend of shrinking condo sizes—partly attributed to investor preferences—factors such as rising construction costs, soaring land values, and demographic shifts play a significant role in this change. The average size of condos in the Toronto CMA has decreased from 947 square feet in the 1990s to 640 square feet for those built since 2016.

Investors are crucial for funding the construction of smaller units due to the affordability constraints faced by renters. High interest rates and construction costs have led to a reduction in housing starts, emphasizing the need for investor participation in the market. Without these investors, the supply of condos could diminish significantly, further limiting rental options for individuals and families. The dynamics of the housing market reflect broader economic trends, illustrating how investor activity shapes the availability and affordability of housing in urban areas.

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