Newcomers Pay a Premium to Secure Housing Amidst Toronto Rental Crisis
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Andrea Carranza and her husband faced significant challenges finding housing when they arrived in Toronto last summer. After applying for at least a dozen condo units, they were rejected by every landlord due to their status as newcomers without credit scores, references, or jobs. For two months, they lived on a couch in a cramped apartment shared with other couples, while struggling to find a place of their own. In desperation, they turned to Kijiji and eventually paid $28,300 in advance to secure a one-bedroom apartment, depleting their life savings in the process.
This trend of paying large sums of money up front is becoming more common among newcomers, who often feel this is their only option to secure housing. Real estate agents frequently suggest offering up to 12 months’ rent to overcome the hurdle of lacking local credit histories or job references. Despite this practice not being illegal, it creates a risky environment where tenants can be exploited. The Ontario Residential Tenancies Act only permits landlords to ask for the first month's rent and a deposit equivalent to one month’s rent, but many tenants end up paying more to secure a rental.
The situation is exacerbated by a tight housing market and a backlog at the Landlord and Tenant Board, which delays the resolution of disputes and refunds. Real estate agents and landlords may prefer dealing with tenants who offer more money upfront, which puts newcomers and other renters at a disadvantage. The Ontario Ministry of Municipal Affairs and Housing suggests increasing housing supply as a solution, but in the meantime, newcomers are often advised to have extra funds ready to navigate the competitive rental market.
Read the full article on: CBC
