Between sky-high rent prices and declining mortgage rates, it seems like the age-old question of renting versus buying is on every prospective homebuyer's mind, yet there never seems to be a clear winner, especially when you account for inflation and location.

A new Zoocasa report aims to answer this broadly debated conundrum by examining which Toronto neighbourhoods are more affordable to buy in or rent in. 

Using data from the Toronto Regional Real Estate Board (TRREB), the real estate listing firm calculated the average rent for apartments in the city, and then compared this to the average cost of condo apartments across the same neighbourhoods to determine which was more budget-friendly. 

Average rent prices for Q3 2023 and condo prices for February 2024 were used.

Which Toronto neighbourhoods are more affordable for renting versus buying in 2024. Photo: Zoocasa.

According to the report, only nine out of 35 Toronto neighbourhoods have average monthly mortgage payments lower than average rent, making renting the most affordable option in 77 per cent of neighbourhoods. 

In the prestigious York Mills—Bridle Path-Hoggs Hollow neighbourhood, renting is substantially more affordable, with the average mortgage payment being $6,273 and the average rent being $3,642 — a difference of $2,631 per month.

Other neighbourhoods where it's more budget-friendly to rent instead of buy include Mount Pleasant, Mimico, Willowdale East, Scarborough Village, Stonegate and Queensway, and Birchcliff.

On the other side of the spectrum, the report found that Black Creek and York University Heights offer the most budget-friendly average mortgage payment at $2,281, which is approximately $400 lower than the average rent in the area.

In 17 per cent of the neighbourhoods analyzed, the price difference between the average mortgage and rent payments is within the $100 mark. In High Park-Swansea, Roncesvalles and Parkdale, the difference between buying and renting is only $10 a month, and only $23 a month in Yorkville, Annex, and Summerhill. 

The most significant price difference in favour of buying-over-renting was found in the Willowridge-Martingrove-Richview neighbourhood, where the average mortgage payment is $549 less than the average rent.