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Tag Archives: high density

Where Are All The Places To Grow?

Development regulations a hindrance to housing affordability and choice

Toronto Star

It’s hard not to notice all the condominiums cropping up across the GTA these days.

Condos accounted for 62% of new-home sales in the GTA last year, according to RealNet Canada, a Toronto-based national provider of real estate information services. And it seems that everywhere you look, there are construction cranes and new residential towers dotting the urban horizon. What isn’t as visible, however, is the lack of subdivisions being built and the dwindling availability of new low-rise houses.

A decade ago, 75% of all new homes sold in the region were single-family houses. Last year, low-rise housing comprised just 38% of new-home sales, largely the result of provincial policies aimed at protecting greenbelt lands and promoting intensification.

The GTA housing market has been reshaped fundamentally by provincial policies introduced in 2006 as part of the Growth Plan for the Greater Golden Horseshoe, a region in Southern Ontario whose boundaries extend south to Lake Erie and north to Georgian Bay. With the Greenbelt Plan, the province has aimed to protect 1.8 million acres of green space, and its Places to Grow plan has designated areas best suited for intensification.

Commenting on the dearth of low-rise houses, Paul Golini, chairman of BILD (Building Industry and Land Development Association), says,”People can’t see what doesn’t exist anymore.” BILD represents more than 1,375 member companies in the land development, home-building and professional renovation industries in the GTA. “The homes under construction today were sold to the homeowner a few years ago. The industry is worried about the balance in housing options and the affordability of new homes in the future,” says Golini.

The shift from low-density to high-density housing has been directed by provincial intensification policies encouraging a more sustainable approach to urban development. Homebuyers want to choose the type of home that suits their lifestyle through the various stages of life — and choice in the low-rise market is diminishing.

“There just hasn’t been the availability of land when it comes to low-rise product,” Golini explains. “Not only is the low-rise price index the highest it’s ever been — $609,369 [this past] August — it’s also driven the market toward high-rise. And if you’re a first-time buyer, that seems to be your only option.”

There has also been plenty of resistance to the intensification policy in the GTA at the municipal level, delaying approvals of condo projects and pitting developers against community groups opposed to the introduction of denser forms of housing in their neighbourhoods.

“Local interests are not always aligned with the province’s goals when it comes to growth and intensification,” Golini notes. “Not everyone is ready to accept this new form of living.”

The development industry has been operating in accordance with the provincial growth plan, says Golini. But six years in, it has become clear that the policies have had an adverse impact on homebuyers, he says, creating severe constraints on land availability and resulting in limited housing options and ever-increasing prices.

“Places to Grow was designed to put tension in the system to promote higher-density development, and that tension is there,” says BILD president and CEO Bryan Tuckey. “But you wonder if the balance has been shifted too far.”

With an estimated 100,000 people moving to the GTA each year, Tuckey notes that the industry recognizes that the lack of affordable housing options for new and first-time homebuyers is a serious issue in the GTA, and wants to be part of the solution. “Our industry plans and builds about 40,000 homes every year to meet the demand from first-time homebuyers, the aging demographic, immigration and the changing family formation.”

The challenge is getting political and community support to build them.

Many municipalities have outdated zoning bylaws that don’t conform to Places to Grow and don’t include intensification targets, says Tuckey, resulting in further delays, as rezoning is required before construction can begin on higher-density projects.

“I interact with many of the best developers in the city and they all feel that the approval process gets bogged down at the city level,”says Barbara Lawlor, president of Baker Real Estate, a leading brokerage firm in the GTA.

“We need to see more streamlining when it comes to the red tape and the layers of regulation,” Golini agrees, noting too that excessive development charges and parkland requirements create hindrances that contribute to higher home prices.

BILD is determined to ensure the 68,000 hectares of whitebelt lands — the area between the GTA and the greenbelt — are preserved for growth past 2031.

Though the whitebelt was intended to function as an urban reserve that would accommodate future growth in the region — whose population is projected to spike from 6.3 million to 8 million by 2031 — many municipalities have been restricting development of these lands.

“If the province was able to give a clear statement regarding the whitebelt and its long-term future,” says Tuckey, “it would go a long way to helping the implementation of Places to Grow in the GTA.”

Suburban Option – What did you buy and why?

Elaine Viterbo — 40, manager, North 44° restaurant

Where did you buy? Upper Unionville, a 1,700-home community at Kennedy Rd. and 16th Ave.

Tell us about your place. It’s a 2,300-sq.-ft. detached home on a 34-foot lot.

What appealed to you? For six years my husband and I have been living in a townhouse in Richmond Hill, but the pricing there for a detached home is ridiculous. We paid $720,000 for the home at Upper Unionville, so the price was appealing. So is the location — it’s easier to commute to work. Plus, it’s near my aunt’s house and she can take care of my two-year-old. And Unionville is a nice community that’s still growing.

Why a low-rise home, not a condo? My husband really likes having a backyard, even though you have to mow it, and there’s the maintenance of the home itself. But it’s also just the freedom; you don’t have to use an elevator. And we look at condos as a whole bunch of people living in one space.

Why did you buy new, not resale? I like the thought of being the first person using the bedroom and bathroom; being able to create something we want, not having to say, “We like the house except for this, but maybe we can renovate it to be that way”; being able to pick our own finishes — the builder had its own décor centre, so we chose the decor ourselves, and it suited our tastes; also, the smell of a new home (it’s like buying a new car).

When do you move in? August 2013. We visit the site weekly to see what stage it’s at. But it’s still just dirt at the moment.

City Centre Option – What did you buy and why?

David Porter — 39, condo-garden designer, Toronto Condo Garden

Where did you buy? River City, Phase One, King St. E. and River St. (the first residential project in the new West Don Lands precinct)

Tell us about your place. It’s a one-bedroom, 762-sq.-ft. corner unit on the 12th floor, with north- and west-facing views.

What appealed to you? The amazing and unobstructed view of downtown. The second reason was value — it was $437,000, including one parking spot and a locker. This worked out to $525 per square foot, compared to the downtown core, which is five minutes away by streetcar, where condos are going for about $700 per square foot. I thought it was a cool little pocket of the city.

Why a condo, not a low-rise home? I travel quite a bit and I like walking out the door and not worrying about it, so it fits my lifestyle. Although a backyard garden can be nice, I do love gardening on a balcony or a terrace. So easy to maintain and change up.

Why did you buy new, not resale? I’m not big into resale. That’s part of the fun of buying new construction — actually watching it, being able to pick all your finishes and then seeing it go from nothing into something.

When do you move in? Next summer. They’ve just topped off my building and I can see there are windows being installed, so they seem on schedule.

—————————————————————————————————–
Contact the Jeffrey Team for more information – 416-388-1960

Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.

—————————————————————————————————–


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  • Vertical development: A dense idea

    It turns out cram­ming more peo­ple into cities won’t help the envi­ron­ment or our health, and may even hurt the economy

    Tam­sin McMa­hon – Macleans

    Last month Toronto’s deputy mayor, Doug Holy­day, uttered what has become a cul­tural taboo in Canada’s largest city. Down­town Toronto, he said, is no place to raise a family.

    Holy­day, who lives down the street from his grand­chil­dren in the sub­ur­ban Toronto neigh­bour­hood of Eto­bi­coke, was against a city plan to force condo devel­op­ers to reserve 10% of their build­ings for three-bedroom “fam­ily friendly” units.

    I could just see now: ‘Where’s lit­tle Ginny?’ ” he said. “She’s down­stairs play­ing in the traf­fic on her way to the park.”

    His com­ments were swiftly denounced by Adam Vaughan, the down­town coun­cil­lor who had been push­ing for the family-friendly condo units and once proudly told a reporter he had never vis­ited the sub­urbs around Toronto. (“There’s Toronto and there’s the rest of Canada,” he said.)

    Holyday’s view was hardly orig­i­nal, but was so shock­ing because of how it flew in the face of what has become accepted wis­dom in cities across the coun­try: we need to rad­i­cally increase the num­ber of peo­ple liv­ing in the down­town core if we’re going to accom­mo­date pop­u­la­tion growth while end­ing urban sprawl.

    The doc­trine of urban inten­si­fi­ca­tion is already hav­ing a dra­matic effect on the condo-lined sky­lines of cities like Toronto and Van­cou­ver, but the debate has been play­ing out across the coun­try with com­mu­ni­ties as dis­parate as Miramichi, N.B., Saska­toon and Cal­gary all wring­ing their hands about how to stop the relent­less march to the suburbs.

    In July, Rev­el­stoke, B.C., passed a law requir­ing the city to cut green­house gas emis­sions by 15% by 2030, in part by encour­ag­ing high-density development.

    Saska­toon is plan­ning to turn a for­mer dog park in a low-density neigh­bour­hood of Sec­ond World War hous­ing into nine apart­ment build­ings. The city also has plans to rede­velop 97 hectares of indus­trial land in the north down­town into a mixed-use devel­op­ment that could house 6,000 peo­ple and five mil­lion square feet of retail and com­mer­cial space. Some argued the city didn’t go far enough, with coun­cil­lor Myles Heidt telling the Saska­toon Star-Phoenix the devel­op­ment should strive for “extra-high den­sity” capa­ble of hous­ing up to 30,000 peo­ple, or nearly 13% of the city’s cur­rent population.

    Miramichi’s new devel­op­ment plan calls for more multi-unit hous­ing. Cal­gary, con­sid­ered the epit­ome of the Cana­dian car-centric city, recently hired an urban plan­ner whose per­sonal motto is: “No place is worth vis­it­ing that doesn’t have a park­ing problem.”

    After decades of watch­ing North Amer­i­can cities gut­ted by res­i­dents flee­ing to the leafy sub­urbs, urban enthu­si­asts are now declar­ing an end to low-density development.

    In the eyes of many city plan­ners and polit­i­cal lead­ers, the sub­ur­ban ideal of the single-detached house on a quiet cul-de-sac, com­plete with a large yard and the req­ui­site lengthy com­mute, is a relic of a bygone and largely unsus­tain­able era. In its place, they are push­ing for “smart growth” com­mu­ni­ties fea­tur­ing high-density housing-usually in the form of apart­ment and condo complexes-in mixed-use neigh­bour­hoods where every­one walks, bikes or takes the bus. It’s the only way, we’re told, to han­dle our rapid pop­u­la­tion growth with­out destroy­ing the envi­ron­ment and clog­ging streets with traffic.

    Urban plan­ners have been hotly debat­ing how to cope with sprawl-or whether we even need to cope with it at all-for decades. But the smart-growth move­ment has picked up steam over the past decade as envi­ron­men­tal­ists con­cerned about global warm­ing pointed the fin­ger squarely at the sub­ur­ban com­muter for con­tribut­ing to cli­mate change.

    But a grow­ing body of crit­ics is argu­ing that far from rais­ing our qual­ity of liv­ing, green­ing our envi­ron­ment and mak­ing us all walk more and drive less, the kind of rad­i­cal inten­si­fi­ca­tion plans now in vogue with urban plan­ners are dam­ag­ing our economies, rais­ing our cost of liv­ing and fail­ing to get peo­ple out of their cars and onto pub­lic tran­sit. What we need, they say, is a much more thought­ful debate over how to live beyond the push to cram more peo­ple into ever-smaller spaces.

    The whole dia­logue on den­sity is too focused on num­bers rather than being focused on what den­sity can actu­ally offer,” says Pierre Fil­ion, an urban plan­ner at the Uni­ver­sity of Water­loo. “What is impor­tant is, what kind of envi­ron­ment are you going to cre­ate? This is as much, if not even more impor­tant than grow­ing density.”

    The con­cept of smart growth, with its belief in densely pop­u­lated mixed-use neigh­bour­hoods, has long been linked to the ideas of Jane Jacobs, the Amer­i­can urban plan­ner whose The Death and Life of Great Amer­i­can Cities called for a return to a live­able urban com­mu­nity. But Jacobs decried neigh­bour­hoods full of high-rise build­ings and wor­ried that den­sity, if left unchecked, could “begin to repress diver­sity instead of stim­u­late it.” Instead, urban plan­ning his­to­ri­ans point out that the modern-day smart-growth move­ment looks much more like the ideas of George Dantzig and Thomas Saaty, two Amer­i­can math­e­mati­cians who in 1973 devel­oped a series of com­puter mod­els for the ideal urban set­ting, which they termed the “com­pact city.”

    Effec­tive use of the ver­ti­cal dimen­sion,” they argued, could solve a host of prob­lems fac­ing the growth city, among them: “smog, traf­fic, time lost in com­mut­ing, acci­dents, slums, noise, pol­lu­tion, inac­ces­si­ble nature, unsafe walks and play areas, end­less chauf­feur­ing of chil­dren and ris­ing cost.”

    Our claim,” they wrote, “is that it is now cheaper to build land than to go out and rob nature.”

    Dantzig and Saaty’s belief that dras­ti­cally increas­ing the pop­u­la­tion den­sity of our cities was the only way to solve a host of envi­ron­men­tal prob­lems has become a cen­tral tenet of the modern-day smart-growth move­ment. Sup­port­ers argue that build­ing up our cities and sub­urbs will cut down on green­house gas emis­sions by short­en­ing our com­mutes and encour­ag­ing more of us to take pub­lic tran­sit to work or walk.

    It would be nice to think that sim­ply hav­ing more peo­ple live close together down­town would make peo­ple, par­tic­u­larly chil­dren, health­ier. Less time spent in cars, the think­ing goes, means more time walk­ing to nearby gro­cery stores, play­grounds and schools. But when researchers from the Uni­ver­sity of South­ern Cal­i­for­nia, North­east­ern Uni­ver­sity, and Berke­ley tracked the phys­i­cal activ­ity of chil­dren aged nine to 11 who had moved to smart-growth com­mu­ni­ties and com­pared them with chil­dren in tra­di­tional sub­urbs, they found lit­tle evi­dence of a great shift. Chil­dren in smart-growth com­mu­ni­ties tended to play more out­doors, usu­ally in their neigh­bour­hood, while chil­dren in the sub­urbs played more indoors, the study found. But it con­cluded that “increases in daily moderate-to-vigorous phys­i­cal activ­ity did not sig­nif­i­cantly dif­fer by group.” In other words, chil­dren who moved to smart-growth com­mu­ni­ties changed where they played, but not how much.

    Another study out of the Uni­ver­sity of South­ern Cal­i­for­nia exam­ined the core prin­ci­ples of smart growth to see whether any of them actu­ally had any influ­ence on rates of phys­i­cal activ­ity. The only ones that did, they found, were poli­cies pro­mot­ing more open space and those that advo­cated for “dis­tinc­tive com­mu­ni­ties with a strong sense of place,” nei­ther of which are par­tic­u­larly linked to density.

    Aside from fail­ing to make us any health­ier, there’s mount­ing evi­dence that smart growth doesn’t live up to the hype when it comes to improv­ing the phys­i­cal state of the envi­ron­ment, either.

    A 2009 study from the Geor­gia Insti­tute of Tech­nol­ogy and the Uni­ver­sity of Wisconsin-Madison mod­elled what smart-growth devel­op­ment would do to green­house gas emis­sions by 2050 and found that “aggres­sive” smart growth that included rad­i­cal inten­si­fi­ca­tion could reduce car­bon emis­sions by eight%. On the other hand, forc­ing every­one to drive hybrid vehi­cles, even if on lengthy com­mutes to the burbs, could cut emis­sions by 18%.

    Researchers found increas­ing pop­u­la­tion den­sity has not been suc­cess­ful at get­ting peo­ple out of their cars and onto pub­lic tran­sit. That’s because pop­u­la­tion den­sity has lit­tle to do with how peo­ple choose to get to work and almost no asso­ci­a­tion with lev­els of pub­lic tran­sit ridership.

    By the sim­ple mea­sure of res­i­dents per hectare, Los Ange­les is North America’s most densely pop­u­lated met­ro­pol­i­tan region, with 27.3 peo­ple per hectare, thanks to its com­pact sub­urbs all con­nected by a net­work of free­ways. Yet more than 90% of its pop­u­la­tion mainly trav­els by car and less than five% by pub­lic tran­sit. That com­pares to Edmon­ton, which houses just 10.1 peo­ple per hectare, but has nearly dou­ble the pro­por­tion of res­i­dents who take tran­sit. Even in Port­land, Ore., a city fre­quently touted by Cana­dian urban plan­ners as the gold stan­dard for smart growth because of its mas­sive invest­ments in light-rail tran­sit and down­town rede­vel­op­ment, 89.4% of res­i­dents still pre­fer to drive to work. In Cal­gary, it’s 76.6%.

    I don’t think den­sity has very much to do with the suc­cess of pub­lic tran­sit,” says Paul Mees, a trans­porta­tion plan­ning pro­fes­sor at Royal Mel­bourne Insti­tute of Tech­nol­ogy in Aus­tralia. “I think that’s the urban myth that is really hold­ing back progress.”

    That idea, that cities need to be jam-packed with peo­ple in order for tran­sit to be viable, first emerged in the 1950s as a way to advo­cate for more spend­ing on roads and high­ways, says Mees. A Chicago trans­porta­tion study at that time deter­mined the region would need 96.5 res­i­dents per hectare (more than three times the pop­u­la­tion den­sity of present-day Toronto) to sup­port pub­lic tran­sit to its sub­urbs, a cal­cu­la­tion that con­tin­ues to hold sway over city plan­ners today. Instead, Mees argues the actual den­sity needed to pro­vide sus­tain­able pub­lic tran­sit is prob­a­bly closer to one where most peo­ple live on lots of 647 sq. m with a well-defined urban bound­ary to keep houses from sprawl­ing ran­domly into the coun­try­side. In other words, tra­di­tional sub­ur­bia. “That seems to be almost all of Canada,” he says.

    While Toronto’s city coun­cil was engulfed in a debate over the need for more family-friendly, three-bedroom con­dos in the city’s down­town, the Toronto Real Estate Board released a report that said just 19 three-bedroom con­dos were sold in the down­town core in the sec­ond quar­ter of the year. The con­dos aver­aged around $800,000, hardly a family-friendly price tag.

    Real estate prices inevitably rise in tan­dem with pop­u­la­tion density-one of the main rea­sons, smart-growth crit­ics say, that poli­cies to stop sprawl by increas­ing den­sity in our cities and sub­urbs are des­tined to fail. The more peo­ple you try to cram into a city, the more expen­sive real estate gets, and the more peo­ple are inclined to flee to the sub­urbs for more afford­able hous­ing. In fact, a study released in May from Cam­bridge Uni­ver­sity in the U.K. found that dra­mat­i­cally increas­ing urban den­sity might reduce car use by a mere five%, but the envi­ron­men­tal gains from that reduc­tion would be dwarfed by the eco­nomic con­se­quences of mak­ing cities more expen­sive places to live and do busi­ness. “Any econ­o­mist will know when you restrict the sup­ply of a good that is in demand, you drive up the cost,” says Wen­dell Cox of the U.S. urban pol­icy con­sul­tancy Demographia and a vocal critic of the push for urban inten­si­fi­ca­tion. “If we can fig­ure out a way to do smart growth with­out rationing land, it might be a good idea.”

    It’s not only fam­i­lies who have been flee­ing to the sub­urbs as land prices in the city sky­rocket, jobs have also migrated, lead­ing to what’s been dubbed “job sprawl.”

    For instance, down­town Toronto is no longer the region’s largest employer, says Cox. More than 350,000 peo­ple work in the sprawl­ing area around Pear­son air­port, com­pared to 325,000 in down­town Toronto. Between 2001 and 2006, 94% of new jobs in the Toronto area were out­side of the cen­tral munic­i­pal­ity, he says, with rates of 70% in Mon­treal and 75% in Van­cou­ver. And as jobs have moved out of cities, down­town res­i­dents have fol­lowed them, lead­ing to the increas­ingly com­mon phe­nom­e­non of the “reverse com­mute,” where res­i­dents leave their homes in the city to drive to work in the sub­urbs. Nearly a third of the com­muter traf­fic in and out of Toronto as of 2006 involved city res­i­dents head­ing to jobs in the sub­urbs. Almost as many Toron­to­ni­ans com­muted to Vaughan, a sub­urb north of the city, as com­muted from Vaughan into the city. In Van­cou­ver in 2006, more than 40% of com­muter traf­fic was doing a reverse com­mute; in Mon­treal it was 23%.

    Lisa Anttila is one of those reverse com­muters. She lives in down­town Toronto, where she bikes to the gro­cery store and the doctor’s office. But she gets in the car to go to work at her family’s busi­ness man­u­fac­tur­ing stain­less steel prod­ucts in Markham, a sub­urb north of the city. Most days her work sched­ule is flex­i­ble enough that she can time the com­mute to avoid traf­fic, but that has become more dif­fi­cult in the six years she’s been doing the drive. “It used to be, ‘Don’t get on the road between 7:30 a.m. and 9:30 a.m.’ Now it’s like if you haven’t left by 7:30 then you’re pretty much wait­ing until after 10,” she says. “Iron­i­cally it seems like half the peo­ple who live [in Markham] come to Toronto to work and so they fill the jobs with peo­ple from Toronto.”

    At its worst, Anttila’s 18-km reverse com­mute can now take nearly 90 min­utes by car. Pub­lic tran­sit, she says, is not an option. “It takes me longer on pub­lic tran­sit than it does by bicy­cle,” she says.

    Smart-growth devel­op­ment is unlikely to reverse that trend. Researchers from East Car­olina Uni­ver­sity stud­ied what hap­pened to jobs in 350 U.S. met­ro­pol­i­tan regions between 2001 and 2006, com­par­ing those that had restric­tions on sprawl with those that didn’t.

    Eight of the 11 cities with anti-sprawl laws had “job sprawl” rates that were worse than the aver­age. Bend, Ore., a city that under­went mas­sive mixed-use rede­vel­op­ment before being slammed by the finan­cial melt­down, fared four times worse than the national aver­age. Mean­while, some low-density cities in Texas, Ten­nessee and South Car­olina had actu­ally man­aged to attract more jobs than they lost to the suburbs.

    The fact that more den­sity can’t deliver a bet­ter com­mute to work and can even make con­ges­tion worse, is one of the biggest eco­nomic argu­ments against urban inten­si­fi­ca­tion, Cox says. “The only rea­son peo­ple move to cities is to do bet­ter because the oppor­tu­ni­ties in cities are bet­ter,” he says. “If peo­ple don’t begin to real­ize what they’re doing to really nice cities, you could very well in the long run see growth pushed out of them.”

    Those munic­i­pal­i­ties that do embrace smart growth have been doing it at the expense of indus­trial devel­op­ment, pre­fer­ring to con­vert fac­tory zones into areas for hous­ing. And that is doing last­ing dam­age to the abil­ity of cities to cre­ate enough jobs for their fast-growing pop­u­la­tions, says Nancey Green Leigh, a brown­field rede­vel­op­ment expert with Geor­gia Tech Uni­ver­sity. She stud­ied the indus­trial devel­op­ment poli­cies of 14 major U.S. cities and 10 smart-growth regions and found smart-growth plan­ning either ignored the needs of indus­try or saw it as a blight on the urban land­scape. Man­u­fac­tur­ing jobs were van­ish­ing from North Amer­i­can cities long before the advent of smart growth. But Green Leigh says the push for urban inten­si­fi­ca­tion has aggra­vated that trend. Once old indus­trial land gets con­verted to con­do­mini­ums, it’s never long before new condo dwellers begin to demand that any remain­ing man­u­fac­tur­ers and fac­to­ries be given the boot.

    The loss of indus­trial land to con­dos, offices and retail com­plexes has become a prob­lem in B.C.’s Lower Main­land, where the port author­ity has run up against stiff oppo­si­tion to its plans to buy prop­er­ties for future indus­trial uses. Port Metro Van­cou­ver has recently pur­chased 142 hectares of land in the Lower Main­land to safe­guard for indus­trial use. But, CEO Robin Sil­vester says, provin­cial esti­mates point to the need for as many as 809 hectares of indus­trial land if the region is to stay eco­nom­i­cally com­pet­i­tive and avoid becom­ing a res­i­den­tial oasis for the wealthy and retired. And that has put the port on a col­li­sion course with those who believe the areas should be reserved for more urban liv­ing. “We need to have a bet­ter qual­ity of dis­cus­sion around the prob­lem that’s emerg­ing,” Sil­vester says. “Oth­er­wise we run the risk of becom­ing like com­mu­ni­ties in parts of Florida where a lot of peo­ple go to live, but where there’s no eco­nomic activ­ity tak­ing place.”

    Van­cou­ver is per­haps Canada’s stark­est exam­ple of what hap­pens to real estate when a city becomes a place where every­one wants to live. But urban plan­ners across the coun­try are sin­gu­larly focused on end­ing sprawl. The irony is that the cur­rent obses­sion with smart growth may just become one more thing that pushes us, our fam­i­lies and our jobs, even far­ther into the burbs.

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    Con­tact the Jef­frey Team for more infor­ma­tion – 416−388−1960

    Lau­rin & Natalie Jef­frey are Toronto Real­tors with Cen­tury 21 Regal Realty.
    They did not write these arti­cles, they just repro­duce them here for peo­ple
    who are inter­ested in Toronto real estate. They do not work for any builders.

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  • The ‘Manhattanization’ of Toronto will change family-housing dreams

    Prithi Yelaja – CBC News

    The housing dreams of families wanting to live in central Toronto will undergo a sea change in the coming decade as the supply of detached homes dwindles and the remaining ones soar in price, real estate experts say.

    The pressure is already mounting with single-family homes being snatched up in fierce bidding wars for tens of thousands of dollars — and in a few cases for $200,000 or more — over asking, often with no conditions attached to the offers to purchase.

    Comment: Which is where all the upward pressure on price is coming from. Not from condos. Not from foreign investors.

    Along with a shrinking stock, prices for single detached homes and townhomes are projected to go up 30% to 50% in the next decade, while condo prices are expected to rise only moderately or stay flat as the oversupply in that market continues to grow.

    That scenario effectively eclipses ordinary families out of the market, making condo living the default housing option for those who want to remain in the core.

    It’s a phenomenon real estate mogul Brad Lamb refers to as the “Manhattanization” of Toronto.

    “In New York City, even if you’re an investment banker making $1 million a year, you still can’t afford to buy a house in Manhattan, so you’re buying a condo,” says Lamb.

    It’s the same phenomenon, he says, that you see in other big cities of the world, such as Hong Kong, Tokyo, London and Paris.

    “If you want to live in central Toronto, you’re going to have to live in a condo. Families will be forced to buy into high-density living. It’s the natural evolution of a city,” says Lamb who develops condo projects in Toronto, Ottawa and Calgary.

    Shift in expectations

    For families, the transition to condo life will require a change in mindset and shift in expectations to vertical living in a smaller space, says Ben Myers, editor and vice-president at Urbanation, a real estate newsletter.

    It’s a mindset that new Canadians coming here from cities like Hong Kong, Singapore and Mumbai are used to and have no problems with, he adds.

    “It’s more the Canadian mindset where you have to have a piece of property, fenced in with a yard and a garage.”

    Culturally and economically, Torontonians haven’t arrived at the Manhattan scenario — yet, says John Pasalis, president of Realosophy Real Estate Brokerage.

    “You can’t buy a house in New York City or Hong Kong. It’s so expensive, it’s just not an option, but in Toronto we do still have affordable houses.”

    Buyers can get a freehold house for around $500,000 if they’re prepared to go farther east on Danforth Avenue or farther west along Bloor Street and lower their expectations in terms of finishes, according to Pasalis.

    “We’re at least a decade away before families truly cannot afford houses in Toronto and have to start considering condos as an option,” he says.

    Size going to be an issue

    With Toronto building more highrises than anywhere else in North America, local buyers might think they have plenty of options in terms of buying condos.

    About 53,000 new condo units are due to be completed in Toronto over the next 18 months alone.

    However, even when families do adjust their expectations and mindsets to embrace condo living, they will come up against a wall over a lack of larger units roomy enough to accommodate a growing family of any size, experts say.

    Of the 6,005 condos ready for occupancy this year in the former city of Toronto, 63% are studios, one-bedrooms or one-bedrooms plus den. The average size is 822 square feet, according to a report by Urbanation

    Meanwhile, of 9,090 condos slated for completion in 2014, 67% are studios, one-bedroom units, or one-bedroom plus dens. The average size of all these units is only 695 square feet.

    The reason for this is that, typically, developers have to sell 60% to 80% of their units before they can secure bank financing to start construction, so they’re building what sells now — small units for singles and young couples who want to be urban dwellers.

    There’s just no demand for three-bedroom condos downtown. Those units sit on the market a long time,” says Pasalis.

    Adds Myers, “the developers in the downtown market are catering their product to investors, who are interested in smaller units that are easier to rent or flip. The larger the unit, the longer it takes to rent out or sell.”

    A looming glut in ‘micro’ units

    But today’s trend may well lead to a glut of “micro” units and a looming housing crunch for families who will eventually want to live in condos.

    Toronto city Coun. Adam Vaughan, for one, is worried about what he calls the “explosion” of single occupancy units in the downtown core.

    “Family housing has to be in all parts of Toronto not just in the suburbs,” he says. “If all we do is build this type of housing, we’ll just delay sprawl for another generation and create a simplistic monoculture downtown.”

    Vaughan is pushing developers to build more family housing in his downtown ward with some success — more than 600 units of housing with three or more bedrooms have been constructed or approved in the last four years.

    “I appreciate that developers are nervous about building what they can sell,” he says, “but we can’t allow market forces to do city planning.”

    The city does offer incentives to developers by approving additional height and density for their projects in exchange for their building larger family-friendly units, as well as condos with knockout panels, which can be combined to make larger suites in the future, and units designed for disabled residents.

    “Diversity keeps the downtown core vibrant. Diversity is accommodating different family configurations and different economic price points,” says Vaughan.

    For his part, Lamb agreed to build 30 three-bedroom units in his 300-unit 32-storey King Charlotte project at King Street east and Spadina in order to get it approved.

    Tough sell

    But so far, only seven of the 1,000-square-foot three-bedroom condos, priced at under $600,000, have sold.

    “They’re a tough sell,” says Lamb. “We’ve had to offer all kinds of incentives. It’s just not what people want right now. It’s a shame.”

    Acceptance of condo life has gone through several phases, says Lamb who has been selling them since 1988.

    When he started, Lamb recalls that people “turned their noses up at condos,” seeing them as an inferior housing option.

    Then, through the condo boom of 2000 to 2012, builders enticed young buyers and investors with tiny “super highly-stylized Prada shoe apartments,” by selling a hip, downtown lifestyle.

    Twenty years ago, studio condos — units without bedrooms — were typically 600 square feet. Today they’re more likely to be half that size at 300 square feet.

    Lamb predicts the next wave of condo building will reverse the trend to pint-sized units.

    “As the city matures, and there is no room for single family homes and the price gap between them and condos grows, that gap will be filled with larger, more luxurious condo units that resemble small homes.”

    Toronto’s condo boom

    Toronto has 132 highrise buildings, defined as between 12 to 40 floors, under construction, according to a German research company that tracks data on multi-storey buildings.

    Mexico City is second with 88 and New York City is third with 86. Rounding out the top five are Chicago, which is building 17 high-rises and Miami with 16.

    With 1, 875 completed high rises and skyscrapers, Toronto is second only to New York City, which has more than 4,000, and ranks just ahead of Mexico City and Chicago.

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    Contact the Jeffrey Team for more information – 416-388-1960

    Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
    They did not write these articles, they just reproduce them here for people
    who are interested in Toronto real estate. They do not work for any builders.

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