Nearly two decades ago, Sharlene Henry moved into a Toronto rental tower built in the 1970s.
The building at 33 King St. — which shares a block in the Weston area with a seniors home, a brown-brick church and a stretch of train tracks — wasn’t anything show-stopping. But its location in Toronto’s northwest offered convenient highway access and affordable rent.
Henry, 47, was 30 when she moved in. She lived alone in a one-bedroom unit, paying around $700 a month while working as a retail store manager.
As she got married and her family grew, she moved from one unit to another in the building, then another. She’s lived for more than a decade now in a two-bedroom she shares with her husband and three kids. They pay $1,334.43 a month — well below the $2,115 asking price on a similar two-bedroom listed in January. She’d like to leave, but as rents have soared citywide, Henry feels stuck.
“We’ve outgrown our space,” she said. “But the market has outgrown us.”
The situation in the Weston tower is not extraordinary — it’s a microcosm of the growing divide in the rental market that is fanning the flames of inequality across the city.
As renting a home becomes more expensive, the incentive to hold onto a unit long-term grows — even if it no longer makes sense for the household that lives there. Many worry about facing today’s market, which has left other renters and neighbours scrimping together monthly bills.
The Star honed in on 33 King because it offered a unique chance to examine data not usually disclosed publicly. A former landlord filed records of the unit-by-unit rents to an Ontario tribunal repeatedly in the last decade, while applying for above-guideline rent increases.
Looking at more than 300 units that were occupied in both 2012 and 2021, the Star found that tenants who’d lived at 33 King for more than a decade faced average rent increases of 28 per cent. If the apartment changed hands in that time, the average shoots up to 73 per cent.
In the starkest case, one apartment was up 118 per cent. The 2012 tenant had lived there since 2009, and spent $1,010. The unit changed hands at least twice, and by 2021, a new tenant was paying $2,200.
While long-time tenants have faced a combination of annual rent hikes within the province’s guidelines, and above-guideline increases their former landlord argued were needed to recoup costs for repairs in the aging building, turnover can be the most lucrative. Under Ontario’s rent-control system, a landlord can set the price of an empty unit to whatever they want. The average asking price for a purpose-built rental in Toronto, per rentals.ca, hit $1,966 in December.
So, in buildings such as 33 King, long-term renters cling to their units with hopes of keeping costs low. Some then wind up feeling stuck — fearing leaving or losing their units, lest they be priced out of their communities. Newer renters, meanwhile, face far higher bills than their neighbours for similar units in the same building, with some already on the cusp of what they can afford.
“People in a similar situation, except for their original leasing date, pay very different amounts,” said housing policy researcher Gregory Suttor. It’s a situation that mirrors the severe gulf between those who bought homes in Toronto decades ago, and those searching for one today.
But the fix isn’t easy or singular, Suttor and others say, calling for a conversation that goes beyond rent controls — one that considers other ways governments can respond to broader market forces, such as programs that help build more affordable homes — to close the gap between tenants by making today’s rental market more accessible to those who need it.
While Henry is spending well below market rent for her home — with the average market price for a two-bedroom apartment hitting $1,661 a month in Toronto last year — the three two-bedroom units listed as available in December were well above that price — at $1,875, $1,900 and $2,115 apiece.
She benefits from Ontario’s rent-control system, which sets an annual maximum for how much sitting tenants’ bills can increase. The current regime covers any rental unit first occupied before Nov. 15, 2018, with the highest allowable rent increase for 2022 being 1.2 per cent. When a tenant moves out, however, a landlord is allowed to ask a new tenant to pay any amount.
The system covers both purpose-built rentals — units built explicitly to be filled by tenants, not bought — and other units in the secondary market, such as condos that are purchased and rented by individual owners. It’s meant to give sitting tenants more security. But Henry’s lower rent has become a double-edged sword. With three kids in tow, she’d love to find a bigger place, but can’t find anything in the neighbourhood that wouldn’t come with exponentially higher bills.
Their goal was initially to buy a home, but, as home prices have risen faster than most Torontonian households’ incomes, it’s something that’s felt increasingly out of reach, even with Henry’s husband taking on a second job.
She knows her newer neighbours in the building are facing their own set of challenges. While she was originally able to afford an apartment in the building on her own, she sees newer tenants squeezing in with more roommates or family.
Henry feels there’s some tension between the older and newer tenants. On top of lower rents, she said, older tenants didn’t have to pay certain extra bills. “One lady told us she’s not joining our tenant association because we don’t pay hydro,” she said.
Reine El Lahham and her husband, Sam, are among the newer occupants, having moved in during 2020. They’re spending just shy of $1,600 a month for a one-bedroom, which had been rented in 2012 for roughly half that price.
Their unit was more reasonable than others on the market, El Lahham said. Most of the nicer spots they’d found had asking prices above $2,000 — a cost the couple simply couldn’t afford. Many others in the lower range were small or dirty. The apartment at 33 King wasn’t perfect, El Lahham noted, but it was the best they could find.
“It’s livable,” she told the Star.
El Lahham knows some of her neighbours are spending far less for similar units, but says she’s OK with the split. Among those tenants are seniors or people relying on social assistance, she said. She wouldn’t want them to face higher bills just to even the playing field.
Still, if their rent jumped, she worries they couldn’t afford to stay — and with the building aging, she argues it wouldn’t make sense.
“It’s not worth much more,” El Lahham said. She listed peeling paint and what she saw as small or dated amenities. “I don’t see why this pressure should keep going up.”
Across Toronto, more and more households have been struggling with affordability.
Dana Senagama, a senior analyst with the Canada Mortgage and Housing Corp., says over the last decade the average cost of purpose-built rental units in the Greater Toronto Area has grown at a similar pace to inflation. But many tenants were holding onto their units, with limited turnover keeping the average down, Senagama said.
She’s also watched as a gulf has grown between what some tenants are paying and what the market demands. For 2021, she said the average asking rent for a two-bedroom purpose-built rental unit in the GTA was about 25 per cent higher than the average price current tenants were paying.
“Vacant unit rents are significantly higher than a prevailing rent or someone that’s been renting as a long-term tenant,” Senagama said. “Let’s say you’re trying to get into the rental market for the first time now — you’re going to face a much higher sticker shock.”
Staying put isn’t a foolproof method for keeping rents low. Landlords can apply to the Landlord and Tenant Board for above-guideline increases, as the former owners of 33 King have done six times since 2012. Three of those applications were still working their way through the tribunal as of the fall, having been filed in 2018, 2019 and late 2021.
It’s a process meant to recoup the costs of “extraordinary or significant renovation,” among eligible circumstances.
For each application, the landlord was required to submit a list of rents for each affected unit, allowing the Star to see the changes in costs over time. (In 2012 only, two rent amounts were listed per unit, one including parking costs and one without. The Star used the former value to contrast with the most recent data.)
In the latest application, the former landlord argued an increase was needed to cover repairs to leaks and asbestos, among other items, at an estimated cost of more than $1.4 million.
Chiara Padovani, chair of the York South-Weston Tenant Union, is skeptical of the AGIs. “Not only does the landlord create more revenue from rents by the AGI itself, it also, once people get to a point that they can’t afford that kind of drastic increase from one month to the next, they’re forced to move out, which then gives the landlord the opportunity to ask for a much higher rent from the incoming tenants,” she said.
Records show the previous owner of 33 King was a numbered company, with its listed directors matching the executive ranks of Woodbourne Capital Management. Woodbourne did not respond to multiple inquiries from the Star.
Last fall, the building sold to Dream, along with an adjacent residential building at 22 John St. Michael Cooper, Dream’s president, said it would be taking over the ongoing above-guideline applications.
He’s upfront about the company’s priorities. They want to address Toronto’s affordability challenges, he said, but also operate as a business.
“We want to make market returns,” he said.
They plan to set aside 40 per cent of the units in 33 King and 22 John, where rents won’t be brought up to market rent during turnover. Those rents would stay at least 30 per cent below market rate, Cooper said, as part of a deal with the federal government that would guarantee them loans with better conditions.
The affordable units Dream plans to create wouldn’t be the kind of deeply affordable or rent-geared-to-income units needed to pull a household from homelessness, Cooper said. The idea, in his view, was to provide homes for mid-income earners, including the city’s nurses, firefighters and teachers.
For the other 60 per cent of units though, he expects the company will try to match the current rates whenever a new tenant moves in — as it faces the costs of retrofits and keeping the aging tower in a state of good repair.
“Whatever market rent we can get is what we’ll pursue.”
Shephaine Langford — also known as Daphney — has lived in her one-bedroom apartment at 33 King since 2010. As of the fall, her monthly rent was $1,074.74.
After more than a decade holding onto the same space, Langford believes she’s earned the right to pay a below-market price — a relief especially when relying on disability benefits.
“I feel that I’ve paid my dues from being here,” Langford said. Her unit itself isn’t particularly enticing, she said — it’s aging and was located close enough to the train line that the sound bothers her.
But Toronto has changed since she moved in. “It’s not even about the actual apartment. It’s that I can’t afford to live anywhere even if I wanted to right now.”
The idea of security of tenure is the thought underpinning Ontario’s rent-control system, with the reprieve between tenants known as vacancy decontrol.
Decontrol draws mixed views. Some see it as a kind of pressure valve, allowing property owners to charge modern rates after a long-term tenant leaves, and incentivizing better upkeep of a property to attract those higher-paying renters. Others have criticized it as driving rents further upwards, and a potential incentive to displace longer-term renters.
Housing researcher Suttor, a former adviser for the Toronto and Ontario governments, believes rent control is an important part of the conversation around affordability. But to narrow in on the chasm between what older tenants are paying and market rates, Suttor thinks a combination of policies is needed.
“In a world where policy was a little more thought out and purposeful, we would have a few arrows in the quiver. I think that flexible rent control is a necessary tool to protect tenants, but I also think you can’t just regulate the market with its huge forces,” he said.
Some options, he noted, included more programs to help non-profits buy existing rental buildings, increasing the availability of housing benefits, and more public money directed toward creating moderately priced rental housing.
He sees the current situation as inequitable. The answer, he argued, wasn’t increasing rent pressure on sitting tenants — but to make today’s market more affordable.
The Toronto housing advocacy group More Neighbours, in a recent report, also called for solutions that go beyond rent control. If the core drivers of rising rents and low vacancy rates weren’t addressed, the group wrote, “we are effectively trapping incumbent renters in homes unsuitable to their needs as they change.”
The report asked for more government incentives to help build purpose-built rental housing. Senagama, the CMHC analyst, also thinks boosting rental housing could help.
“It just opens up your pool of selection,” she said. “You’re not going to have this, where more people are just staying put because they can’t afford to go anywhere, or they can’t find anything else. We’re not going to have this huge disparity.”
Back at the Weston tower, tenant Sandy Bathie says leaving 33 King St. is out of the question.
She arrived at the Weston tower with her husband and daughter in 2014, their two-bedroom also falls under Toronto’s average rent, with a price tag of $1,464.11 per month as of late 2021.
While her husband was working prior to COVID-19, she said he lost his job during the pandemic — and his employment supports have since dried up. That left their family, too, relying only on Bathie’s monthly disability benefits. They’d already been straining to meet their monthly rents. But she believes leaving the tower would be worse.
“I can’t afford to move,” Bathie said. “And I can’t afford to stay.”
Victoria Gibson is a Toronto-based reporter for the Star covering affordable housing. Reach her via email: firstname.lastname@example.org