Canada

Toronto and Vancouver Real Estate Is Flooded With Amateur Landlords

Ontario and British Columbia real estate is filled with investors, and most are landlords. New Statistics Canada (Stat Can) numbers show the number of multiple-property owners in 2018. The highest concentration of these owners is, not surprisingly, in Toronto and Vancouver.

Multiple-Property Ownership

The Stat Can study focused on multiple-property owners, excluding non-residents of Canada. The study focused on Ontario, B.C., and Nova Scotia primarily. Most of the owners are small landlords, with a smaller number of people flipping. The median age of multiple-property owners is 56 in Ontario, and 57 in British Columbia. That places their age similar to the median of typical homeowners, within a couple of years.

Ontario Has Over 835,000 People That Own Multiple-Properties

The number of multiple-property owners in Ontario is mindblowing. There were 835,175 multiple property owners in 2018. Toronto has 359,475 of these owners, representing 43% of the total in Ontario. In a distant second is Ottawa, with 55,770 owners – 6.9% of the province’s total. Multiple-property investment is an extremely large segment of Toronto’s housing market.

Ontario Multiple-Property Owners

The number of property owners in Ontario regions, that own at least two-properties.

Source: Statistics Canada, Better Dwelling.

The majority of Ontario’s multiple-property owners own just a second property. A whopping 76. property owners in 2018. Toronto has 359,475 of these owners, representing 43% of the total in Ontario. In a distant second is Ottawa, with 55,770 owners – 6.9% of the province’s total. . This indicates the majority of these owners are likely small landlords.

Canadian Multiple-Property Owners

The percent of multiple-property owners, by number of properties held.

Source: Statistics Canada, Better Dwelling.

Over 268,600 People In British Columbia Own More Than One Home

Multiple-property owners in British Columbia is also very high, considering the population. There were over 268,600 multiple-property owners located in B.C. in 2018. Vancouver contains 143,910 of these owners, about 53.6% of the total. In a distant second is Victoria, with 21,030 of these owners, representing just 7.8% of the total. It’s a massive part of Vancouver’s market, in contrast to other regions in the province.

B.C. Multiple-Property Owners

The number of property owners in B.C. regions, that own at least two-properties.

Source: Statistics Canada, Better Dwelling.

The number of properties held by multiple-owners is similar to Toronto. About 76.7% of multiple-property owners have a second property, including their occupied home. Those with 3 properties represent 15.9% of multiple-owners. Only 7.4% of multiple-property owners had four or more properties in 2018. Once again, the takeaway is the vast majority of these owners are small investors.

The number of small landlords shouldn’t surprise many. Canada’s addiction to cheap financing makes condo development more favorable. Its unfortunate Stat Can didn’t provide the year these properties were acquired. This would have yielded more interesting insights, especially for those with two properties.

Increasingly investors have been piling into the market, and driving prices higher. In Toronto, they’re even willing to lose money on rent, for the privilege of being a landlord. This introduces a massive pricing inefficiency. Knowing when it began, could help analysts understand how these issues are born.

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15 Comments

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  • Mitch 3 months ago

    Median age is Boomers. So… clearly Millennials aren’t working hard enough, because Boomers… are predatory landlords, and they vote for governments that will basically take our tax dollars and give it to them as further incentive?

    • Ian 3 months ago

      This is why younger cities like Hamilton are thriving, while Toronto has turned into a broken record, trying to tell everyone it’s cool while everything shuts down, and empty storefronts start to litter the streets.

      I was in Toronto last month, and man that place is depressing.

      • ChrisMCP 3 months ago

        Ahahahaaahahahahahhahahaha

        Keep on saying that to yourself, maybe it will work eventually

  • Kevin N 3 months ago

    This is the kind of information the industry needs. It’s the only way to get a handle on what has driven the real estate market up to such insane levels. It’s disturbing to think that these people are also willing to just break even or lose money hoping that the resale just keeps going up endlessly. This is a highly leveraged situation that will be very sensitive to shifts in market demand.

  • Jonathan Mutch 3 months ago

    This is pretty much the global industry standard. I’m not sure why you would think this is revelatory or somehow a consequence of the Canadian mortgage environment?

  • Mike 3 months ago

    When your in the back of a cab.You should not be listening to your driver bragging about how many homes he owns.Wonder why we have a housing shortage?

    • Cal 3 months ago

      We aren’t having enough babies to sustain the population without immigrants. We would have a housing glut without immigration. Maybe we would be bulldozing houses to deal with the “oversupply”. Or maybe they would be cheap enough to afford having children (if that’s the reason).

  • Joseph 3 months ago

    Nice pic of Hamilton at the top. Thanks for representing.

  • Neil 3 months ago

    Can you compare those numbers to the total number of privately owned properties? For instance if Ontario has 835,000 Multiple-Property owners, is that 15% of the total ownership in the province? If you get to the point where 25% of the market owns 2 or more properties, then you get a situation where less than half of the population owns and you start sliding towards serfdom where most people are renters.

  • Mtl_matt 3 months ago

    Been harping about this for years. Easier to blame foreigners than to recognize that greed and borrowed money is the biggest driver of this insane bubble.

  • Joseph 3 months ago

    From the mortgagesandbox website:

    “Most economists are forecasting that the Bank Rate will remain unchanged until after the federal election in Canada. Only 3 months ago, the same economists thought rates would stay flat until mid-2020! What changed? Reading between the lines, Mortgage Sandbox believes the economists predicted flat rates because they were uncertain where the economy was going. In other words, they figured it was a 50/50 chance between the economy doing better or hitting a recession.

    Now they’re starting to predict rate drops. Some even predict 2 rate drops by March 2020! The Bank Rate set by the Bank of Canada Rates is raised when the economy is doing well but if there is a recession then low rates are used to stimulate the economy. Since the economic forecasters are expecting rates to begin dropping it implies they are factoring in an economic slowdown. That may be helpful for moderating red-hot real estate markets in Central and Eastern Canada but it’s bad news for home sellers in Western Canada who are already struggling with weak demand.”

    What stands out most in that commentary is, “The Bank Rate set by the Bank of Canada Rates is raised when the economy is doing well but if there is a recession then low rates are used to stimulate the economy.”

    If our economy was doing well for the last 4 years, as we’re made to believe, then why the heck haven’t the rates been increased?

    To me, that is the crux of the whole situation we’re in. NOW that the economy is going down trying times, how can the rates be raised? It’s counter-intuitive to all that’s supposed to happen. Raise rates in a strong economy, lower rates in a depressed economy.

    What I feel might happen here is unprecedented (to my knowledge); rates will eventually get raised even though the economy will be depressed.

    I’m not a bear or a bull; I’m a realist. And the fact that the rates have continued on a downward trajectory over the last few years should be concerning for everyone. Even for someone like me, without any formal economic education, it’s logical to correlate what should have happened over the last few years, yet hasn’t.

    As I read in another article from June 2019,

    I think we’re approaching this point in the very near future in Canada.

    • Joseph 3 months ago

      The end piece about the other article to my comment – “In that 10-year period where the U.S. was on a diet, getting healthy, Canada was binge eating junk food, which is debt,” Mylonas said, adding a medical analogy. “Eventually you go to the doctor and the doctor says, ‘sorry, you gotta cut the junk food.’ That’s painful.”

  • Ed 3 months ago

    Small landlords are targets for professional tenants. Landlords should know the RTA , LTB, OBC, and OHRC , but they don’t. It’s far too much to know when u have a single property.

    Rules need to be changed to be able to evict bad tenants

  • Martin 3 months ago

    I fail to understand why people think the housing prices are anything but simple supply and demand. Last study I read they estimated 150,000 people a year move to Toronto. No more land to build on so prices go up. If you can’t afford to live downtown move out until you can afford it. Otherwise rent! How many people in New York City own property ?

    • NYC Resident 3 months ago

      Prices in New York City are cheaper for condo apartments, despite more strict controls and higher land values.

      If you can get a condo for half the price in NYC as Toronto, when NYC is building 1/10 the supply, it’s not supply and demand. It’s idiocy. Ditching Toronto for NYC was one of the best moves I’ve made career and housing wise.

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