This may be an unpopular opinion, but I’m going to put it out there - I think the Greater Toronto Area’s housing market is in pretty good shape right now.
Is there an affordability crisis? Yes. Are we still lacking supply? Yes. Do we still need more high-density housing near major transit nodes and the zoning to accommodate this type of development? Yes.
But, it’s not all doom and gloom.
The mortgage stress test debate is still raging on, but the Centre for Urban Research and Land Development recently weighed in and made a few great points. The stress test was introduced to prevent buyers from taking on too much debt and risk in an overheated market. It worked. The market cooled. And now, a year and a half later, sales activity is rebounding and hovering around the long-term average.
This is a good thing, but there are still members of the real estate industry fighting to have the stress test changed/loosened. Up to a few months ago, I was one of them. I thought the stress test did its job and it was time to readjust. CUR explains how the market is still at risk of overheating, even with the stress test in its current form, so loosening the policy would fuel demand - demand that is already too strong for our current housing supply.
I still do believe that there has to be leniency with the stress test in the future, but not until we figure out a way to build more housing in a quicker fashion. At this point in time, making it easier for more people to buy homes won’t help increase the supply...it would do the opposite.
Another thing that caught my eye recently is that Toronto currently has 120 construction cranes active - the most of any city in North America. Why does that matter? Each construction crane represents growth and jobs. If new mixed-use communities, residential developments, and infrastructure developments are being built, then the economy is doing well. The more people working, the more money gets spent, and more people who can afford housing.
I also heard about the all-female development team hosting a community consultation for a project called Reina Condos. I’ve been in the new home industry for a few decades now, and I think it’s fair to say it’s a male dominated world. I actually can’t believe it’s taken this long for a developer to take a female approach to condo design.
There are so many things that can be done to improve condo life for women (and everyone else); better lighting in parking garages, fewer zig-zagging corridors, more storage, more play areas for kids, more flexible spaces in general. I’m happy to see Urban Capital and Spotlight Developments taking this approach to the design of their new condo in Etobicoke.
So, we have sales activity balancing out with the long-term average, price growth calming, more construction than any other city on the continent, and innovative industry members making strides with intelligent condo design.
Let’s stop looking at the market in a negative light, stop working against each other, and start working together. The most urgent thing in my eyes is increasing housing supply and creating zoning that allows for higher density residential around major transit nodes. Let’s make it happen.