More Canadians than ever are driving to work, proof that efforts to promote mass transit and densification have not succeeded in killing the dream of a house in the suburbs.
As Statistics Canada reported on Monday, the number of Canadians commuting to work by car increased by 3 per cent between 2011 and 2016. Public transit use was flat, while the number of people driving to work alone rose. Fully 80 per cent of Canadians got to work by car in 2016, either as drivers (74 per cent) or as passengers (6 per cent).
What this indicates, more than anything, is that policy-makers seem to have systematically underestimated how much ordinary people are willing to sacrifice for the space of a detached single-family house, preferably with a big yard for their kids, while having a little left over to spend on travel or to sock away in a retirement savings account.
If it means having to endure longer commutes to work in their cars, so be it.
Finance Minister Bill Morneau needs to consider the evidence as he weighs demands from the real estate industry to ease mortgage rules for first-time buyers in his March 19 budget. The real estate industry may be complaining about a slowdown in the condo market, but is stoking condo sales really the smartest move in 2019, after years of trying to guide the country’s most overheated real estate markets to a soft landing?
Extending the amortization period on insured mortgages, easing the stress test introduced last year or increasing the $750 tax credit for first-time buyers might encourage more millennials to purchase a condo, the only type of property within financial reach. But since most millennials ultimately aspire to purchase a single-family home, it’s worthwhile asking whether Canada needs any more condos right now.
“In terms of housing preferences – including tenure, types and location – millennials are not that different from the generations that preceded them,” according to a 2018 study by the Centre for Urban Research and Land Development at Ryerson University. “The bulk are expected to want home ownership and ground-related (singles, semis and townhouses) housing with a back yard.”
Given the overconstruction of condos, the study estimated that the Greater Toronto and Hamilton Area could be short an additional 70,000 ground-related housing units from millennial demand alone over the next decade. Thus, if policy-makers are really concerned about housing affordability for millennials, they need to encourage the construction of more single-family homes in existing suburbs and inner suburbs.
With so much emphasis on densification in recent years, policy-makers may have unwittingly encouraged urban sprawl by forcing more Canadians to look further to the exurbs to realize their dream of a owning a detached, single-family home with a yard.
Indeed, the fastest-growing municipalities in Canada between 2011 and 2016 were largely exurban communities, where a single-family home could be purchased for much less than a similar property closer to the core. This trend was particularly striking in Greater Montreal, as off-island communities drew more young families.
In the decade to 2016, the population of “auto suburbs” off the Island of Montreal surged by more than 20 per cent, while the on-island population grew by 4.7 per cent. Immigration accounted for almost all net population growth on the island.
Data released last week by the Quebec statistics agency showed the exodus from the island accelerated in 2018. Montreal suffered a net loss of almost 24,000 residents to other regions of the province last year, the largest drop since 2010. Almost all those who left the city moved to the suburbs or exurbs around Montreal.
Those who left told a similar story to local reporters. While living close to the core was great in their early 20s, they began to sour on it as soon as they started a family. Finding an affordable house on the island that met their needs was near impossible.
A Léger Marketing poll also released last week showed that two-thirds of millennials considering property ownership within the next five years would prefer to buy a single-family home. And most expect they will have to look to the suburbs to find one.
Attempts by urban planners and policy-makers to condition Canadians into accepting condo living as a permanent state in life have not stopped millennials from dreaming the suburban dream. After all, Mr. Morneau, that 500-square-foot box in the sky gets tired after a while.