PROVINCIAL PROFILES
GREATER TORONTO AREA
CHANGING TRENDS SHIFT CONDO DEVELOPERS TO NEW APARTMENT CONSTRUCTION IN THE GTA
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ith a population over five million, the Greater Toronto Area is the largest urban centre in Canada and one of the largest in North America. It continues to experience strong economic growth and an influx of immigration. Two distinct apartment markets exist within the GTA. The mature centres such as the cities of Toronto, Mississauga, Brampton, Hamilton and Oshawa have large apartment universes, with most stock built prior to the imposition of rent control in the 1970s. Outside of these centres, in the newer suburbs which comprise half of the GTA’s population, very little apartment construction has taken place. In the mature centres, which have larger and older apartment universes, all indications are that the marketplace is starved for new stock. The condominium boom taking place throughout the GTA shows that the area’s demographics strongly favour high-rise housing over single-family home ownership. The heated housing market has made rental accommodations more attractive, and created a shadow-rental market within condominium developments. In these established urban centres, new stock comes in at the top of the market. The population of the GTA is expected to increase by over two million over the next twenty years and, in response, every municipality within the GTA has enacted official plans that
BRAMPTON AND OAKVILLE: A TALE OF TWO CITIES
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nlike every other centre in the Greater Toronto Area, the City of Brampton has seen continual new construction through the rentcontrol period, and retains the largest stock of apartments built in the eighties and the nineties in Ontario. By contrast, Oakville has seen no new construction over the same period. This difference has had a tremendous effect on the demographics of both cities, but both approaches bode well for new construction in both centres. The availability of new apartment stock has helped Brampton’s market to mature, giving it a variety of apartment styles to serve its growing and
CITY City of Toronto Greater Toronto Area Oshawa Markham Barrie Mississauga Brampton Oakville Hamilton Niagara Falls Burlington
call for significant intensification. In the newer suburbs, this has produced a heated apartment marketplace where any new construction is easily absorbed by latent demand. Vacancies in the GTA are among the lowest in the nation, and rents are rising rapidly. Traditional single-family suburbs like Markham, Vaughan, Burlington, Oakville and Milton are among the best places to invest in the apartment industry in Canada, since with so little rental apartment stock available, the majority of future investment has to come in the form of new construction. Student housing is another sub-sector which has seen new construction in the GTA. McMaster University in Hamilton, the University of Ontario Institute of Technology in Oshawa, as well as the Universities of Toronto, York and Ryerson and other campuses across the GTA are seeing growth in student enrolments and a corresponding rise in demand for high-end student housing. New off-campus student residences are being built, and are being sold for some of the highest per unit rates in the country. The Greater Toronto Area has one of the largest apartment markets in Canada and the largest opportunity for new construction. Competition is already heating up for the best lands for new development, but the market is large enough and diverse enough that new construction is not only a good investment, but long overdue.
UNIVERSE 256,547 132,400 8,228 1,598 3,300 26,671 9,912 4,419 31,517 3,094 8,306
increasingly upwardly mobile population. As its population continues to grow, so too will demand, and new construction will be added to the market in the years to come. Oakville has some of the most favourable demographics in Canada for high-quality rental housing, but so far no developers have stepped forward to meet this demand. These demographics, future growth, and the decision of Oakville city council to pursue a policy of urban intensification should ensure that new apartment construction finally comes to Oakville, if the right developers seize this opportunity.
NEW % POP'N Median After-‐Tax UNEMPLOYMENT UNITS GROWTH Household 2011 Units Per Average (Est) % NEW Pop'n SINCE 2006 EMPLOYED RATE 2010 RATE 2011 100 Ppl Income Vacancies Rents 6,200 2.42% 2,720,000 8.7% 1,403,260 9.9% 8.4% 9.43 $60,678 1.7% $1,103 3,600 2.72% 4,529,800 13.9% 3,210,190 9.1% 8.5% 2.92 $64,097 1.8% $1,095 153 1.86% 361,240 9.3% 91,150 6.0% 5.5% 2.28 $61,291 2.1% $894 66 4.13% 300,000 14.7% 418,990 9.5% 8.5% 0.53 $73,366 1.7% $1,080 94 2.85% 190,900 7.8% 127,738 6.4% 6.3% 1.73 $58,132 2.0% $993 30 0.11% 734,000 9.8% 178,200 8.5% 7.6% 3.63 $66,507 1.8% $1,099 1,228 12.39% 504,900 16.4% 182,000 10.7% 8.1% 1.96 $64,566 2.0% $1,081 68 1.54% 181,100 9.4% 104,300 10.1% 8.9% 2.44 $76,733 0.9% $1,204 750 2.38% 533,751 1.0% 211,500 8.7% 6.7% 5.90 $55,923 4.2% $747 70 2.26% 85,000 3.4% 44,405 9.1% 6.8% 3.64 $52,475 3.8% $804 950 11.44% 170,000 3.4% 113,753 6.4% 6.3% 4.89 $66,617 1.3% $1,087
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