Publications, opinions, and speeches
The economics of rooming houses
Published on 17/02/2021
Over the past decade, the policy discourse on rooming houses, also known as multi-tenant houses, has focused on regulatory issues. Should rooming houses be legalized across the City? Should the houses be restricted to specific zones or to certain sizes? Should they be licensed? How will standards be enforced?
Missing from this discussion has been a shared understanding of the economics of creating and operating rooming houses, without which all regulatory questions are moot. To fill this gap, Maytree provided funding to investigate the economic viability of rooming houses to inform the City of Toronto’s rooming house policies. The research included:
- Identifying the costs of operating a quality rooming house, drawing on analysis of 79 houses (549 rooms) owned by non-profit providers, supplemented by information from five inner suburban landlords renting a total of 42 rooms;
- Identifying the costs of converting a single-family home to a legal rooming house for a variety of typologies;
- Comparing the rents typically charged by rooming house operators and the alternatives in other rental and student housing; and
- Identifying the public costs of displacing tenants should a rooming house close.
The purpose of this small study is not to provide a comprehensive analysis of rooming house economics but rather to illustrate, by way of example, the considerations that must be addressed in any rooming house policy.