EMPIRE UPDATE RE: COVID-19View Updates
Toronto continues to grow. The GTA’s steady growth in population, property value, and density shows no signs of abating in the coming years. In fact, Ontario’s Ministry of Finance projects the GTA as the province’s fastest growing region, with a population increase of 3 million (or 45.8%) by 2041, including a significant contribution from steady international migration.
The province is looking at implementing policies to manage the forthcoming population growth in order to maximize efficiency, usability, and quality of life across the GTA. Chief among the government’s aims is limiting suburban sprawl, a controversial initiative that will decrease the construction of single-family homes on the sparsely-settled outskirts of the region. If implemented, however, these policies could mean significant benefits for property owners and investors whose interests lie within Toronto proper.
As builders are limited in their options in the suburbs, we’ll see more intensification in already built-up areas. Higher real estate prices, particularly for multi-unit buildings, will follow. Owners and investors holding property in dense, built-up areas will be in a favourable position as demand is limited in the region’s outskirts and tenants or buyers start to look within the city for housing options.
A 2013 report by researchers at the University of Ottawa found that “large houses and big yards are less important to GTA residents than walkable, mixed-use neighbourhoods, short commutes to work, and easy access to frequent rapid transit.” And as governments around the world work to respond to climate change, the cost of fuel is likely to rise as new regulations on carbon set in. This means suburban commuters may choose to move closer to their places of work (into condos located in more densely built-up areas) to save on skyrocketing transportation costs.
It looks like high-profile politicians, including Mississauga Mayor Bonnie Crombie and Ontario Finance Minister Charles Sousa, are looking to encourage greater density, thereby stimulating an already-hot real estate market in the region’s built-up areas. Increasing density often results in the construction of new public transit, bike paths, and walkways, thereby making already-dense neighbourhoods more livable, more accessible, and more coveted by new tenants and buyers.
While there is concern that these kinds of policies could impede the supply of affordable housing in the GTA’s outskirts, it’s also highly likely that these types of regulations will contribute to what real estate policy professional Tom Curtis calls “the Manhattanization of the downtown core… and skyrocketing rents and property values,” an undeniable boom to property investors and owner-landlords within the city.
The GTA is set to debate and analyze proposed new policies until at least September 2016 before any formalized legislation is tabled. Researching and acting on urban property investments before legislation is introduced is key, as realty prices may jump as a reflection of newly-implemented policies.