Unaffordability isn’t expected to abate in the Greater Toronto Area any time soon, but as more and more people are discovering, there are cheaper places to live slightly further afield.
The Greater Golden Horseshoe is slated for major growth, thanks to investment in regional transit infrastructure, an emergent economy, and the growing unlikelihood that homeownership is attainable in Canada’s largest metropolitan area.
“It’s with changes in the mortgage rules that it’s affected affordability,” said Altus Group’s Ray Wong, vice president of data operations, data solutions. “There were challenges before that in the GTA market to find affordable housing at a certain price, and with the new mortgage rules it’s made it that much more challenging. When you look at lower pricing outside the GTA, it makes sense that there’s more activity outside the GTA market.”
Wong added that the B-20 rules have influeced activity in the Greater Golden Horseshoe through the first half of this year.
“Over the last couple of years, it’s really picked up because of the increasing residential prices in the GTA,” he said. “With the changes to the mortgage rules, it’s just created a little more activity, especially in the first half of 2018.”
Altus released a report called Technology, Transit and Transitioning Millennials, determining that Kitchener-Waterloo and Hamilton are on the radar of a growing number of millennials.
“There’s another driver bringing people outside of the GTA,” said Kruti Desai, Altus’s manager of national research insight. “What you can buy within the $500,000 threshold in Barrie and Kitchener—it’s almost double or triple the square footage of what you can buy in Toronto, so you’re getting more bang for your buck.”
Flexible working arrangements among millennials also reflect the interest shown in the GGH. Many erstwhile GTA residents who made the move have a large presence in the tech sector and are allowed to work from home with greater frequency, or simply opt for co-op spaces—which Wong says are sprouting in Burlington, Hamilton and Kitchener.
“The demand for office space in downtown Toronto and the number of tech and financial services has expanded,” he said. “What we find is people working in those jobs look at the Hamilton and Cambridge markets as a way to afford housing and still have close proximity to Toronto. At the same time, Kitchener and Waterloo, where universities and a number of tech start-ups are, show positive growth in condo apartments and new office space to meet the number of expansions and start-ups in that region.”
Metrolinx plans to spend $43bln on expanding the regional transit network over the next decade, and that should amplify the trend of people living and raising families in far-flung satellites all the while working in downtown Toronto.
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