The market for Toronto condos is slowing down in some areas, but it’s still highly active in others. Just this week, a downtown listing at Theatre Park had around 40 offers and sold for $200k over asking. Another unit at the East Yorker near the Danforth sold overnight at asking price. Whether up or down, hot or cold, the Toronto condo market is a complex world that needs more than a quick fix.
The temptation these days is to jump to bold conclusions about the various problems and difficulties facing the Toronto condo market. But singular solutions often overlook the complexity of the issue.
Single solutions to Toronto condo market are not the way
A recent report from the Canadian Centre for Economic Analysis (CANCEA) sought to uncover the leading correlations behind housing affordability pressures in the GTA. The ‘big-data’ report found three main areas of concern:
1) a lack of housing options, particularly townhouse, duplex, and triplex buildings
2) a lack of housing productivity, in terms of over-housing and low density
3) and a trend of ‘forced’ housing lifestyles as residents are priced out of preferred options
Finally, the report concluded that the solution to the problem is more construction in various housing options and designs—600,000 new units are needed within the next decade.
The report openly recognizes the complexity of the issue, and yet still came down to a single solution—build more. Although CANCEA is a fully independent research firm, it’s interesting that the report was conducted on behalf of several construction firms: Residential Construction Council of Ontario, Residential and Civil Construction Alliance of Ontario, Ontario Association of Architects, and the Ontario Construction Secretariat.
Regardless of any “funny-business” going on behind the scenes, the comprehensive CANCEA report is yet another example of the single solution approach. Similarly, the Ryerson Report that was released in March boiled the complexity down to a single issue—foreign speculation. While the study of demand factors behind Toronto’s housing affordability problem was highly insightful, the final conclusion came in the form of a single solution—the need for government action to tame demand.
Toronto condo market affordability is not a two-sided issue
It’s frustrating to watch two comprehensive research reports clash in the classic argument of supply versus demand because it’s never that simple. Real estate is not a two-sided issue that can be flipped like a coin. If anything, real estate is the edge of the coin. The only bottom line truth in real estate is that people want and should be able to find an affordable home.
Toronto’s Chief City Planner, Jennifer Keesmat, is approaching housing in an intelligent way that aims to consider both supply and demand. In an interview with CBC, Keesmat explained a new focus on family-friendly vertical communities. Her approach recognizes both the growing demand for family-friendly condo design and amenities, such as stroller storage space and playrooms, as well as the spatial necessity for new vertical development within the city.
Looking to the future of the Toronto condo market
Keesmat cites the community-centered planning and housing developments in the St. Lawrence Market area that integrate family living amenities with the conveniences of condo living. Buildings such as Yorktown on the Park and St Lawrence on the Park are directly engaged with Market Lane Jr and Senior Public School and David Crombie Park, setting a realistic precedent for family-friendly, condo based neighbourhoods.
CityPlace stands as another example of forward-looking community planned condo development. Recognizing that many first-time buyers are turning into condo-dwelling families, the neighbourhood is set to redevelop two sites on Brunel Court and Fort York Boulevard to create a shared community centre that will include two public elementary schools and a day-care centre. Adding to the drive for community-focused development, the Ontario government has announced plans to reform the Ontario Municipal Board, effectively replacing it with a less powerful Local Planning Appeal Tribunal.
Over the years, the OMB has garnered a shady reputation for favouring the pockets of developers over the needs of local communities, but the new reforms intend to change that. In the past, if a developer met community opposition to the height or density of a proposed project, they could take the issue to the OMB and often have the city-council’s decision overturned. Reducing the OMB’s power should prevent this kind of circumvention.
Rather than stop new development projects from taking off, the OMB reform should help ensure that new developments meet the actual lifestyle needs and expectations of the communities in which they are built. It’s going to be exciting (and perhaps frustrating) to see how developers and city planners address the difficulties of Toronto real estate and work together to find comprehensive solutions.