'Dramatic resurgence' in Toronto rental market leaves apartment hunters scrambling

On paper, Kendra Chaplin is an ideal tenant: a registered massage therapist with a good credit score and strong rental history. But when she recently started looking for a new place, she hit a wall. 

"I thought that I was in a position where I would be fine," Chaplin told CBC News. "I didn't expect to be rejected." 

After less than a year at her current Liberty Village apartment, her landlord told her to leave so they could move into the unit. So she toured a 482-square-foot, one-bedroom unit in a nearby building that was renting for $2,115 a month.

But when she went to apply, she says she was told she would need to make at least $76,000 a year for her application to be considered, even with a good credit score and proven employment. She was also told she would need a guarantor who made at least $100,000 a year on the lease agreement. 

"I was shocked, obviously. I don't make that much money, and I was just really surprised. I hadn't heard of that before," said Chaplin, who says her income falls just below that benchmark. 

She is far from alone in her experience. After a lull last year due to the pandemic, Toronto's rental market has officially bounced back as demand has increased while available inventory is down compared to this time last year. The resulting competitive atmosphere means that many would-be renters are encountering unusual — and sometimes legally dubious — requirements from landlords.

According to the Ontario Human Rights Commission, applying rent-to-income ratios is illegal in this province unless the landlord is providing subsidized housing. 

In an email statement to CBC News, the property management company BentallGreenOak denies it applies a rent-to-income standard and said a junior leasing agent "unfortunately misspoke." 

However, CBC News reviewed emails in which an agent states Chaplin was "under" the qualifying income. Chaplin withdrew her rental application and is still searching for a new home.

Landlords are picky because they can be

The Toronto Regional Real Estate Board (TRREB) reported a 15 per cent increase in apartments rented from last year in their third-quarter report, released on Oct. 29. 

"We've actually seen market conditions tighten up again," said TRREB chief market analyst, Jason Mercer. "Whereas rental transactions on a year to year basis were up … in comparison to last year, the number of properties actually available was down by a third." 

The TRREB report suggests this is a trend that will continue for at least the next few years, stating, "We have seen a dramatic resurgence in rental demand this year. This demand will be augmented in 2022 and 2023 by record levels of immigration. Unfortunately, the supply of rentals is not keeping pace."

Shawn Zigelstein, a broker with Royal LePage Your Community Realty, said this low inventory of rental units allows landlords to be picky. 

"They're going to look for A-plus tenants with credit that is absolutely perfect. They're going to look for great jobs and … fantastic references, as well as income coming in on a regular basis," he said. 

But Zigelstein has also seen some more unusual requests from landlords. 

"I had one landlord ask us if they could go to the tenant's place of work and talk to their manager," he said. 

And he has heard of landlords wanting to tour a tenant's current home to evaluate how they live. 

This power dynamic is likely to continue until more rental inventory becomes available, said Zigelstein.

CBC News reviewed an email exchange between Chaplin and a leasing agent in the building she toured in which she was asked to show how much money she had in her bank account.

"I didn't have as much as he wanted. He wanted $7,000 at least," she said. 

Rental requirements can be discriminatory 

Dania Majid, a lawyer at the Advocacy Centre for Tenants Ontario, said some of these rental requirements are concerning and some may even be discriminatory in practice. 

Her advice for prospective renters is to know their rights and what landlords are allowed to ask.

"Some landlords actually do not know the law," Majid said. "You might want to identify to the landlord, 'This is the information I'm comfortable providing, and this is what the law requires.'" 

But doing so may be risky when a person is up against a dozen or so other potential tenants, she said. 

Majid said government intervention is needed to re-establish balance in the rental market. 

"We really do need the province to step in and help create more affordable housing," she said. "We need policies that help increase the housing supply for tenants, especially those in the lower income brackets." 

As for Chaplin, she's also worried about what this all means for the average renter — if someone with her employment, credit score and rental history is facing such difficulties. 

"I left feeling like an idiot for even thinking that I could have walked in there," she said. 

"I can't imagine the challenges that other people are facing."