development-led evictions

Development-led evictions add to housing woes

New CMHC report looks at what's driving Toronto tenants out of their homes
Tuesday, October 5, 2021

The landscape of rental housing has changed in recent years, with notable sources citing a marked rise in development-led evictions. Commonly referred to as “renovictions”, this type of displacement occurs when a property owner or landlord applies to evict a tenant due to the desire to make changes to the unit, building, or land. Research in this area has been sparse, and as such, CMHC recently embarked on a study to delve more deeply into the issue.

“Formal, development-led eviction applications in Canada’s largest municipality, the City of Toronto, increased in prevalence between 2010-2020,” observed report authors Christopher Zakher and Jordan Nanowski from CMHC’s Housing Market Insights team. “This phenomenon, which relates directly to the potential loss of rental housing for certain households—and, in the context of a supply-constrained rental market such as Toronto’s, the potential loss of limited affordable rental housing options—has largely gone unexplored. For this reason, we sought to uncover key trends underpinning it over the previous decade.”

Process & background

Using eviction applications as a proxy, the report provides insight into the prevalence of development-led evictions in Canada’s largest municipality and puts these findings in context with the loss of rental housing it may cause for specific households in need of affordable options. Essentially, the study set out to answer the following three questions:

  1. What has been the prevalence of formal, development-led eviction applications in the City of Toronto over time?
  2. Was the assumed work that inspired these formal eviction applications warranted?
  3. Primarily, who was submitting these applications— existing or new rental property owners?

Key findings

When compared to the size of the primary rental market stock, the prevalence of formal, development-led eviction applications between 2010-2020 was low. Nevertheless, these eviction applications did increase markedly over this period.

Applications were overwhelmingly concentrated in the Former City of Toronto and appeared four times higher for rental units in the secondary rental market versus the primary rental market.

Over the previous decade, formal, development-led eviction applications increased simultaneously with the widening gap between average asking (i.e., vacant unit) and average market (i.e., occupied unit) rents in the city’s primary rental market.

Rental units in older structures in the city’s primary rental market tended to be the subject of formal, development-led eviction applications. As well, city locales with a larger share of rental housing identified as requiring major repairs saw a greater number of applications.

Finally, in the primary rental market, it was relatively common to see formal, development-led eviction applications submitted following the sale of a rental property to a new owner.

Ongoing implications

First and foremost, given the scarcity of affordable rental housing, tenants who are being evicted for the purpose of renovation are then faced with the greater challenge of finding a comparable new home. According to the report authors, this may explain why there has been greater disagreement on the part of tenants with N13 eviction notices in recent years. (Recall that these eviction applications are submitted to the LTB when a tenant disagrees with the N13 notice of eviction or does not move out of their rental unit upon receipt of the notice). Addressing the lack of rental supply would seem to be the most obvious solution to resolve this over the long-term.

The second implication, which comes in the form of a question, is how do we balance the need between adequate rental housing and affordable rental housing in the short-term? In other words, is it possible to address the inadequate housing in which nearly one in 10 of the city’s renter households find themselves in without evicting them into a more expensive, oftentimes, unaffordable rental market?

Thirdly, the report identified a plethora of data gaps when it comes to development-led evictions. Most notably, the report authors stated they were not able to acsertain how many formal, development-led eviction applications led to a single eviction, nor could they gauge the totality of development-led eviction activity taking place (i.e. they were unable to quantify the number of evictions taking place informally).

As the rental housing landscape changes and the prevalence of development-led evictions continues to rise, one obvious implication is that there are few measures currently in place to address the fallout associated with the lack of affordable housing.

Additional CMHC findings related to evictions

Between October 2019 and March 2020, CMHC conducted in-depth, semi-structured interviews with both professional housing stakeholders and tenants who’d lived through an eviction. This analysis revealed that:

  • development-related and ‘no-fault’ evictions are occurring with more frequency;
  • there has been a shift from evictions driven by tenant-factors to those driven by landlord-factors;
  • the changing scale of evictions, with mass evictions involving entire buildings at once, were reported in Winnipeg, Vancouver, New Westminster, Kitchener–Waterloo, Hamilton, Toronto, and Halifax.

To find out more about the changing topography of the rental housing landscape, and specifically, what’s driving residential evictions, visit:  www.cmhc.ca.

 

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