Rents for studio condos are dropping fast, so they might not be the best investment for you right now. Over the past year, rent prices for studios have fallen more than any other condo size, while larger condos have kept their value steady. Why? The number of studio condos on the market has surged — 28% in Toronto from 2016 to 2021 — while larger condos have barely increased, leading studio owners to lower prices to attract renters. Plus, older millennials, who make up almost half of the first-time homebuyers in Canada, are finding value in buying larger condos. They can rent them out at higher prices and still have the option to live in them eventually. So, while a studio condo might seem like a steal, waiting and saving for a two- or three-bedroom unit could be a smarter move for better returns down the road.