Small-Scale Investors Hold Significant Share of Ontario and B.C. Housing Stock

A recent Statistics Canada report finds that individual small-scale investors owned about 10 per cent of the housing stock in Ontario and British Columbia in 2022. The analysis, conducted by the Canadian Housing Statistics Program (CHSP), measures ownership by assessed property value rather than by the number of properties. In Ontario, small-scale individual investors, defined as those with up to five properties, held 8.9 per cent of the market’s assessed value. Medium-sized individual investors, with more than five properties, owned an additional 1.3 per cent. In British Columbia, small-scale investors accounted for 9.6 per cent, and medium-scale investors 1.9 per cent of the assessed housing stock value.

Institutional and corporate ownership comprised a smaller share in these provinces. In Ontario, businesses owned 3.2 per cent and institutional investors, which include pension funds, family offices, and real estate investment trusts (REITs), held 4.9 per cent of the assessed housing value. In British Columbia, businesses owned 4.5 per cent and institutional investors held 4.3 per cent. These proportions differ from provinces such as Nova Scotia and Manitoba, where institutional investors’ shares were 9.5 per cent and 6 per cent respectively.

Across the broader housing market, investors—encompassing individual, business, and institutional categories—held 22 per cent of Ontario’s housing inventory and 25 per cent in B.C. In Nova Scotia and Prince Edward Island, the investor share was higher, at nearly 30 per cent and 27 per cent, respectively.

The report also examines investor ownership within rental housing. In Ontario, small-scale individual investors held 52.6 per cent of the assessed value of rental properties, compared to 23.6 per cent for institutional investors. In B.C., small-scale individual investors owned 49.4 per cent of the rental housing stock, with large investors accounting for 20.3 per cent. In cities like Vancouver and Victoria, institutional investors represented more than a fifth of the rental housing market. In London, Ontario, institutional investors’ share of rental stock was highest at 46.5 per cent.

The prevalence of small-scale investors in Ontario and B.C. rental stock is attributed to the high number of condominiums in those provinces. Joanie Fontaine, an economist at Statistics Canada and the report’s author, stated that the secondary rental market, particularly the condo segment, has grown since the 1990s, facilitating participation by small-scale investors. “The secondary rental market (the condo segment) has increased as the share of the rental market since the ‘90s. And this increase could be related to the increase of the presence of small-scale investors, because it’s easier for them to buy condo,” Fontaine said.

From 2011 to 2021, condominiums constituted almost 40 per cent of housing units built in Ontario, while purpose-built rental units made up only 10.6 per cent. This construction pattern has contributed to the prominence of small-scale investors in Ontario’s rental sector. In contrast, institutional investors own a relatively small proportion in Ontario—0.4 per cent, or four out of every 1,000 houses, according to the CHSP data.

The dynamics of investor ownership shifted during the pandemic, as investors increased their activity in the housing market amid historically low interest rates and rising rents. Near the peak of the real estate surge in 2021, investors accounted for one-fifth of all home purchases, a trend that raised concerns about impacts on home prices. At that time, however, comprehensive data on investor types and market share were not available.

The CHSP, established after the 2016 Toronto and Vancouver real estate boom, aims to provide greater insight into the housing market by utilizing tax filings and land registry data, among other sources. The current report does not include data for Alberta, Quebec, Saskatchewan, Newfoundland and Labrador, or the territories.

Institutional investors in Ontario and B.C. are generally more involved in purpose-built rental buildings and medium- to large-sized apartment complexes, rather than small units or detached homes. Nemoy Lewis, assistant professor at Toronto Metropolitan University’s School of Urban and Regional Planning, observed that institutional investors focus on acquiring housing stock at scale for portfolio growth, stating, “Having hundreds and thousands of units under portfolios is important to them.”

In recent years, as the condominium market in the Greater Toronto Area experienced oversupply, there has been an emerging trend of private funds and larger investors bulk-buying unsold condo inventory at discounted rates. Some developers have also shifted unsold condo projects to purpose-built rental developments, a move supported by funding from pension funds and large investors.

The report indicates that rental pricing competition in Toronto remains robust, with institutional investors not dominating the market. However, Nemoy Lewis cautioned that aggregate statistics may obscure variations at the neighbourhood level, where institutional investor concentration can influence rental costs. He cited research in areas such as North Rexdale and northwest Toronto’s Weston and Finch neighbourhoods, where localized impacts differ from city-wide trends. Lewis advised, “I would be careful in terms of saying competition is healthy because it hides the unequal experiences that tenants have, especially if you operate at such an aggregate level.”

According to data from Rentals.ca, rents in Toronto have declined steadily for 28 months but remain three per cent higher than four years ago. The Statistics Canada report’s focus on the Toronto Census Metropolitan Area (CMA)—which includes surrounding regions such as Peel, York, Halton, Durham, Simcoe County, and Dufferin County—may mask specific urban trends, according to Lewis.

The findings have contributed to ongoing debates about housing affordability. Ricardo Tranjan, Ontario research director at the Canadian Centre for Policy Alternatives, suggested that the report challenges the narrative that increasing housing supply alone will resolve affordability issues. “Much of the housing debate in general is still based on the fantasy that house prices and rents are so high because we don’t have enough housing for everyone,” Tranjan said. “Whereas studies like this show that it’s not only families that are chasing housing, it’s investors of all sizes.”

The CHSP’s ongoing work, initiated in response to earlier real estate booms, continues to inform policymakers and stakeholders about the evolving nature of housing ownership, investor activity, and the broader implications for rental markets and affordability.