ULI Toronto’s Executive Director and the Ontario Director of the Pembina Institute discuss what homebuyers apparently want versus what they are getting.
By Richard Joy
Eighty one per cent of Greater Toronto Area (GTA) homebuyers want walkable, transit-friendly neighbourhoods to live in, according to a report released by the Pembina Institute and RBC this fall. And yet a significant percentage will settle for car-dependent communities. Shouldn’t we be changing this paradox? I took a walk along Roncesvalles Avenue in Toronto’s west end with the report’s author and Ontario Director of the Pembina Institute, Cherise Burda, to better understand this significant disconnect.
Obviously, as the report makes clear, affordability trumps location preference in the real estate market place. Makes sense. Home buying families are often “driving to qualify” for a mortgage, landing in car dependent suburbs where homes are more affordable. But their transportation costs, which Pembina calculates to be upward of $200,000 per car over a 25-year period, are not factored in the sticker price of the house. The result, Burda says, is that it can be more expensive to live in these suburban communities, with the added irony that this is not what most homebuyers actually want.
To further this important analysis of modern home economics, RBC has engaged Pembina in yet another analysis that will spell out in precise detail the monthly costs comparisons of comparable home purchases in different neighbourhoods across the region. This report is expected later this year and is sure to give future homebuyers some pause for thought. Nonetheless, the reality of land supply economics is that our car-oriented suburban communities will continue to have a stranglehold on the real estate market outside of the city core unless we more aggressively expand the transit-oriented land supply in our region. This means intensification.
I grew up near St. Clair Avenue and Yonge Street, a neighbourhood that experienced significant intensification over the past half century. It was once a quiet and stable neighbourhood that real estate developers targeted for its coveted transit convenience. Massive intensification ensued and now the neighbourhood is still a quiet and stable neighbourhood – only with better shopping and parkland amenities.
The same development story has played out along Yonge at Eglinton and Sheppard Avenues. Each residential intensification, vigorously opposed by its established residents, resulted in more liveable communities than before. But the Yonge Street subway spine’s few examples of responsible residential intensification stand as exceptions to the rule in the Toronto region. The tragic history of our massive capital investments into transit infrastructure is massive under-development.
My walk with Cherise ended at the intersection of Bloor and Dundas Streets. Standing in front of the now-defunct Giraffe Condominiums high-rise project across the street from two equally tall public housing apartment buildings, on top of a subway station, and the soon-to-be-opened Union-Pearson Express station, she observed that such examples are missed opportunities to create affordable transit-oriented market housing in our city. Indeed, the Bloor-Danforth subway corridor is a land use crime scene.
Looking forward, the Province and the regional municipalities are again on the brink of making massive transit infrastructure investments, most notably the electrification of the GO train network. If history repeats we could again squander these critical opportunities to fully leverage these capital investments of public dollars by not ensuring that development follows (or better yet, leads). Clearly this is something we cannot afford to do.
We need a more modern approach to achieving the land use outcomes we seek. We need to do this because of what we have long known: that transit-oriented communities are the environmentally responsible, economically sound and operationally efficient approach to land use. And now, as the Pembina report makes clear, we know we need to do this because this is what future homebuyers really want.