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The real estate market in Canada borders on total lunacy. And I’m not interested.
Not that the idea of home ownership hasn’t ever entered my mind. Of course it has. As an early-30-something living in Toronto with a good job (as an audience growth editor at The Globe), I definitely have contemplated the thought.
But here’s the (distinctly middle class) problem: House prices have been on an upward swing across the country, in my mind, forever. And in Toronto, which seems permanently suspended at the extreme high end, the average selling price of a house in April was $1,090,992. Bidding wars continue to drive prices ever higher and well-salaried young people are moving farther away from downtown cores just to get into the market.
To buy a house in Toronto today requires detaching one’s brain from one’s body – a kind of new-age ritual that’s apparently the price of admission to the elite club of homeownership.
Lately, I’ve been contemplating what my path to home ownership might look like in this market: aggressively saving for another year to buy a tiny studio condo where the only doors are glass and the only walls are concrete (when did this “almost still in construction” aesthetic take over?). My monthly expenses would surge by several hundred dollars and if a single surprise expense arose, poof, there go my savings.
For the luxury of owning a place in Toronto, I’d have to scrimp on all the things that make living in a city (post-pandemic) worth it. And I’d be betting nearly my entire financial future on the hope that real estate prices continue on their fast track to the moon.
So I’m opting out.
This decision has been a relief, in a way, and has helped me let go of resentment I realized I was feeling in the background. As a single person from a middle-class family, I don’t have access to what many of my millennial peers seem to. Couples get an obvious financial advantage: two incomes, two savings accounts, two potential opportunities to tap into generational wealth. Being alone is a personal choice, but one that makes the possibility of ownership that much harder without other help. Parental assistance and access to generational wealth, meanwhile, make a huge difference in scraping together a down payment when home values are untethered from wage realities.
Of course, buying real estate isn’t out of reach for many women, including single people like me. But the reality is, home ownership is a not a realistic goal for many of us.
Renting is fine, and hardly the “financial coffin” some say it is. My current studio apartment – where I’ve lived for five years and where I will probably live until I die – is dirt-cheap by current Toronto standards.
For $1,200 a month, it’s a dream: a third-floor walk-up in the heart of Toronto, with no closets, one window and paper-thin walls (when I’m on Zoom calls, there are moments I’m not sure if I’m participating in my own or my neighbour’s). Still, with below-average rent, it feels like I won the lottery. It’s allowed me to crawl out of some really dumb credit-card debt and start to save aggressively. And after years of a succession of terrible roommates and basement suites, living alone, above ground, feels like an accomplishment and a relief.
Finding accessible, affordable housing shouldn’t feel like a miracle. And the fact that it does is evidence of a massive housing problem.
As Globe personal finance writer Rob Carrick has outlined, there are ways for the government to cool down the market, be it increasing down payments, scrapping the federal Home Buyers’ Plan to no longer allow first-time buyers to use funds from their registered retirement savings plan toward a purchase, or narrowing the capital gains tax exemption. Call me a pessimist, but I don’t foresee any of this happening any time soon and certainly not in a way that creates equity in housing for many Canadians, as home owners or renters.
It’s unlikely I’ll change my mind and leap into this lunatic market. But if I did, it would be because more and better housing options become available. To truly be an equitable, world-class city, Toronto needs more density, more “missing-middle” housing, more co-operative units and a focus on housing for all kinds of family models – including families of one.
I’ll take a shipping-container home or a tiny house, do #vanlife (okay, I can’t drive, so let’s call this Plan C), or rent forever and invest. All these feel like sane options compared to trying to play Canada’s real estate game.
What else we’re thinking about:
After getting stabbed with a tiny (almost totally painless!) needle last week, some part of my sad pandemic brain found the energy to look ahead with optimism to a “one-dose summer.” I was delighted by Dodai Stewart’s case in The New York Times for a national one-week vacation. “One solid week,” she writes. “No one works. NOTHING happens. No work. No work emails, no schoolwork, no one working in the restaurants or making robocalls. Full nation vacation! Important: For this one week, there would be no internet.”
No internet and no work for a week? Literally a dream.
When it’s safe to do so, send Canadians to the mountains, to frolic in parks, cavort in the ravines, finally see that really big nickel in Sudbury, Ont.! There’s a long list of Toronto parks where I have not yet napped. Make me King of Canada, and this will be my number one priority.
And for those who need more incentive, research shows that people who actually relax are more productive in the long run. Restart the economy by doing absolutely nothing? Now that’s sound economic policy I can get behind.
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