Toronto's High Rent Costs Still Draw Newcomers Despite Rising Living Expenses

Arriving in Toronto just over a year ago, I've been watching the city's changes closely. It’s no secret that Toronto and Vancouver continue to attract the majority of new arrivals, even as the cost of living soars. According to the latest data from Statistics Canada, nearly 40% of recent immigrants settle in these two metropolitan areas, a figure that hasn't changed significantly in the past five years.

What’s changed, however, is the financial burden this choice entails. A digital bank, bunq, recently released a Working Abroad Index, which examined 75 cities that attract digital nomads. In this comparison, Toronto and Vancouver stand out as relatively cheaper in most categories, but rent consumes a whopping 68% of a Toronto resident's monthly expenses, and 71% in Vancouver, compared to 58-62% in cities like Berlin and Paris.

For expats and digital nomads like me, this means a full-time job just to cover rent. A minimum-wage worker in Toronto needs to work 145 hours a month, close to full-time, to afford a one-bedroom apartment. In Vancouver, the number is even higher at 150 hours.

These figures aren’t just numbers; they reflect a significant challenge for newcomers. Between 2011 and 2021, immigrant renter households grew more than twice as fast as owner households, making rent a dominant cost for new arrivals. This has led to a retention issue, with Toronto’s immigrant population dropping by eight percentage points compared to a decade earlier. Vancouver, while still attracting more, saw a four-point drop in retention.

Despite the high rent, Toronto and Vancouver continue to draw in new residents. The good news? As immigration numbers cool, the rental market is seeing some relief. However, the affordability crisis is far from over, and it affects both new and long-term residents.