For the first time last year, more than half ofwith a mortgage were losing money on their rental properties in the Greater Toronto Area even as rents soared to new highs, says a report by CIBC and research firm Urbanation Inc.
The losses were substantial. In 2020, such investors were making on average $63 a month. By 2022, they were losing $223 a month and early data suggests by the first quarter of this year that loss increased to $400 a month. About 11 per cent of this group were losing $1,000 a month or more, the report said.
“While the rental market recovered and rents reached new highs in 2022, that growth was more than offset by as interest rates soared, resulting in the average investor of newly completed condos experiencing negative cash flow for the first time,” said the report.Article content Most condo investors, 72 per cent, buy new because the time it takes between the presale and completion, usually about five years, should be enough for rents to rise to cover ownership costs.
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