There was a time not so long ago, when the CN Tower loomed alone above Toronto’s skyline. Today the tower is still far and away the tallest structure in Toronto, but it no longer stands out as loner.
The past couple of decades have seen roughly 1000 condo buildings constructed throughout the GTA, transforming neighbourhoods and in the case one neighbourhood — CityPlace — creating a master planned community from scratch.
CityPlace drew plenty of groans when first proposed. After all, St. James Town was envisioned as something similar back in the 1950s, only to fail and be branded as an undesirable area; in recent years the neighbourhood has begun to recover its image, but there’s still a lot of work to be done to change opinions. However, in the case of CityPlace, the plan was a stirring success story, one which will likely have a huge impact on Toronto’s future.
New High Density Neighbourhoods Are a Great Opportunity for Investors
You need only look to the cluster of condos west of downtown Toronto to see this trend at work. Mimico is found in Etobicoke just a 10 minute drive away from the downtown core via the Gairdner Expressway—over the past decade a high-rise community has taken shape in the area, drawing in businesses and raising property values.
Buildings like Ocean Club Waterfront Condominiums have seen their price per square foot rise by over $200 per square foot in just 4 years; the same is true for Waterscape Condos, which has enjoyed an increase of $270 PSF over a 5 years period.
It’s not just Mimico that has seen rapid growth thanks to high-rise condo developments: Yonge and Eglinton condos such as The Madison have also seen values rise quickly. Price per square foot at The Madison has increased by roughly $250 PSF in 3 years. In fact, even older condos in the neighbourhood have benefitted — Eglinton Place is 18 years old and saw its price per square foot rise by $230 PSF in that same time.
High Density Living is Key for Toronto’s Affordability Problem.
Toronto’s affordability problems have been well documented. Many Torontonians simply cannot afford to purchase a home at this time and the cost of rent has climbed considerably. As of this year, the average price for a 1 bedroom condo crested above $2300 a month, a price that leaves many young professionals living paycheck to paycheck. For low income families, things are much bleaker.
A lack of units has created a very competitive market with developers being seemingly incapable of building units fast enough. But that might change. This past week Toronto’s city council unveiled their Toronto HousingTO 2020-2030, which could see as many of 40,000 affordable units approved in the next 10 years. Estimates suggest that this could positively impact over 340,000 households.
In order to achieve this, government officials will need to lighten residential zoning restrictions for commercial buildings and condos in low density neighbourhoods. The suburban sprawl that surrounds large cities like Toronto is part of the problem. A lack of available land combined with stiff restrictions has created a situation where building large developments is almost impossible in some areas.
This effect has been referred to as the “Yellowbelt” as coined by Gil Meslin, an urban planner. In essence, this yellowbelt has led to large sections of land that are no-go zones for large developments. This map illustrates the problem; huge stretches of Etobicoke, North York, East York, and Scarborough, don’t allow developments over 10 meters, and many only allow detached housing.
In order for Toronto tackle its affordable housing issues, the city will need to open up the neighbourhoods in its amalgamated communities and invite developers to build large developments. Granted, some local residents won’t be happy about that, but it’s absolutely essential for affordable housing.
