Some people might think that rising house prices in the suburbs of places like Toronto will put an end to their attraction, but not real estate expert Norma Walton.
According to a recent article on the CBC, house prices in suburbs such as Richmond Hill and Vaughan have been rising far faster than homes in the city’s core, while prices of homes in general have grown to the point of unaffordability for many people. Both Vancouver and Toronto have seen double-digit increases, even up to 23.5 % in some areas.
Those price increases have helped to drive new trends in the real estate market. Norma Walton knows a lot about these trends through her work as a real estate investor and cofounder of the real estate companies of Penny Lane Properties and Rocket Property Ltd., as well as asset manager of Blue Parrot Properties.
Walton believes that many people will adapt to new conditions in the real estate market. In her view, the high cost of living in Toronto itself will continue to prompt existing homeowners “to convert their significant equity in their Toronto homes into the purchase of a mortgage-free house in a smaller city along with putting some cash in the bank.”
Meanwhile, new buyers who are unable to afford the high city prices will buy homes in less expensive areas, but remain close to the city for employment, in her view. Although many areas of Canada are becoming increasingly urbanized, high housing prices might encourage younger people to move to more affordable locations, especially as they marry and have children of their own.
While some people still prefer the convenience of living within easy walking or cycling distance of the city, the trend toward suburban living is taking hold, even among millennials, according to an article from the Toronto Star. Suburban communities like Ajax and Durham are now becoming the affordable destination for people who have been priced out of the markets in larger centres.
Even with rising prices in suburban areas and major cities, interest in home ownership should continue for some time to come. Many new and existing homeowners still seem to agree with Norma Walton’s assessment of real estate as “a stellar investment, superior in my view to all others.”
Many millennials and other potential homeowners have been dealing with the competing interests of comfort and space versus convenience and short commute times. In Toronto, according to recent statistics, some of them have been willing to pay large amounts of rent, even up to $1800 per month, for the chance to live close to work and the amenities of life in a large city. This works well for younger single people and those newly married.
As millenials marry, begin to settle down and begin to plan for children, the suburbs become an attractive option given the additional space, both indoors and out, for far less money. With extra space for the children and the chance for a stable home with the potential for an investment windfall in the future, homes in the suburbs are attractive options for many people.
Statistics from recent years show that this trend toward the suburbs is not an isolated phenomenon. In Vancouver, for example, car-dependent suburbs have grown at triple the rate of urban centres, a trend that is common to many Canadian cities.
If these trends continue, Norma Walton may well be right in her belief that suburban life is a healthy and growing feature both as a lifestyle choice and as an investment in Canadian cities.