Is Toronto Expensive to Live In? A Deep Dive into Toronto’s Living Costs

Is Toronto Expensive to Live In? A Deep Dive into Toronto’s Living Costs

Toronto is one of the most expensive cities in Canada, with housing prices and daily expenses rising every year. If you’re a renter or newcomer, understanding the true cost of living is essential for making informed decisions. In this guide, we’ll break down current rental prices, housing costs, and what salary you need to live comfortably in Toronto in 2025.

Why Is the Cost of Living in Toronto So High?

Toronto’s high cost of living is primarily driven by demand outpacing supply in both the rental and housing markets. With a growing population, increased migration, and limited availability of affordable housing, prices have remained high despite market fluctuations. Inflation and supply chain issues have also contributed to rising costs for essentials like food, transportation, and utilities, making it more expensive to live comfortably in the city.

For most renters, housing accounts for approximately 35-50% of their monthly income, making it the largest single expense for many residents.

Housing Costs: Renting vs. Buying in Toronto

For many newcomers and renters, affordability is a major concern. While renting offers flexibility, homeownership comes with long-term financial commitments. Let’s explore both options.

Renting in Toronto

Renting is a popular option for those who aren’t ready to commit to homeownership, but affordability remains a challenge. While rental prices have seen some adjustments, the lack of availability in affordable housing continues to push demand for high-priced rentals.

As of March 2025, average rental prices in Toronto are as follows:

• One-Bedroom Apartment: $2,262 per month
• Two-Bedroom Apartment: $2,762 per month
• Single-Family Homes: Rent varies significantly, with many listings exceeding $3,467 per month in central areas.

While renting provides flexibility, finding an affordable unit in a desirable location requires careful planning. Many renters explore shared accommodations or look for rentals in nearby cities to reduce costs. Researching rental trends, comparing different neighborhoods, and considering commute times can help in securing a suitable home within budget.

Buying a Home in Toronto

For those considering homeownership, property prices remain high. According to market data from March 2025, average home prices in Toronto are as follows:

• One-Bedroom Condo: $750,000 – $900,000
• Two-Bedroom Condo: $950,000 – $1.2 million
• Single-Family Homes: Prices vary widely, but many exceed $1.2 million in core areas, with some listings surpassing $2 million in premium neighborhoods.

Homeownership costs go beyond mortgage payments, with property taxes, maintenance fees, and insurance adding to the financial burden. With mortgage rates fluctuating, many prospective buyers are weighing the costs of renting versus buying.

Transportation Costs: Public Transit, Car Ownership & Car Share Services

After securing housing, transportation is the next major expense. Depending on your commute and lifestyle, your costs can vary significantly.

Public Transit (TTC)

• Monthly Pass: $156
• Single Fare: $3.35

While public transit is an affordable option, many commuters cite concerns about service reliability, crowding, and accessibility.

Car Ownership in Toronto

Owning a car in Toronto is a significant expense, particularly with high insurance rates and fluctuating gas prices.

• Gas Prices: $1.50 – $1.80 per liter
• Car Insurance: $200 – $300 per month (varies by location and driver history)
• Car Purchase Example – 2025 Hyundai Tucson:
  • Starting Price: $34,699
  • Financing Option: $529 per month (2.99% APR for 72 months)

• Parking: Can cost $200 – $400 per month in downtown areas

Car Share & Ride Share Services

Many residents opt for car-sharing services such as Zipcar and Communauto or ride-sharing options like Uber and Lyft. Costs vary based on distance and usage, but on average:

• Zipcar/Communauto: $10 – $15 per hour or $70 – $120 per day
• Uber/Lyft: $15 – $40 per ride, depending on distance and time of day

Car-sharing provides flexibility for those who don’t want long-term financial commitments, while ride-sharing is useful for occasional trips without the need for parking.

Grocery & Dining Costs in Toronto

Grocery prices in Toronto have risen steadily in recent years, making it crucial for residents to plan their food expenses wisely.

The cost of groceries varies significantly depending on individual dietary needs, shopping habits, and where purchases are made. Bulk buying, shopping at discount grocery stores, and meal planning can help reduce costs.

• Groceries for One Person: Typically ranges from $300 to $500 per month, depending on diet and shopping preferences.
• Groceries for a Family of Four: Can vary between $900 and $1,200 per month, though larger families may spend more based on consumption and food choices.

Dining out remains a luxury for many, with prices fluctuating based on the type of restaurant and meal choice:

• Casual Meal for One: $20 – $25, usually for a quick meal or fast food.
• Three-Course Meal for Two: $80 – $120, at a mid-range restaurant.
• Coffee: $2.50 – $4.50 per cup, depending on the café and drink selection.

With restaurant prices continuing to climb, many residents opt to cook at home more frequently to keep their food expenses under control.

What Salary Do You Need to Live Comfortably in Toronto?

Your required salary depends on lifestyle choices, housing preferences, and financial goals. While some residents manage on minimum wage, others require a higher salary to maintain their desired standard of living.

• Single Person Renting a One-Bedroom: $70,000 – $85,000 per year
• Couple Renting a Two-Bedroom: $120,000 – $140,000 combined
• Family Owning a Home: $180,000+ combined

While these salary estimates provide a guideline, actual expenses will depend on factors such as debt, lifestyle, and whether you share costs with a partner or roommate.

To explore wage estimates for various job positions across Canada, visit the Government of Canada Job Bank for up-to-date salary insights.

How Much Do You Need to Earn to Afford Rent in Toronto?

A common financial guideline suggests rent should not exceed 30-35% of your gross monthly income. However, in Toronto, many renters allocate 40-50% or more of their income toward housing expenses.

Here’s an estimated breakdown of recommended income levels based on Toronto’s rental prices:

• For a one-bedroom apartment ($2,262 /month): A recommended gross income would be $68,000 per year.
• For a two-bedroom apartment ($2,762/month): A recommended gross income would be $82,000 per year.

These figures are general estimates and may vary based on additional expenses, personal spending habits, and whether costs are shared with roommates or a partner.

So, You Are Renting?

Estimated Costs for Renting in Toronto

Note: These are only general examples, and they can vary depending on personal habits and lifestyle. While the table’s intent is to provide an overall idea, you should always do personal research based on your own needs and lifestyle.