Welcome to the Angular Plane, a blog that explores housing issues in the Greater Toronto Area.
The GTA is experiencing one of the world’s worst housing crises, making it impossible for any young person to afford a home without inherited wealth.
Over the last two decades, housing prices in the Toronto area have simply spiralled out of control. In January 2000, the average condo cost $145,232 while the average detached house would set you back $251,741, according to Listing.ca. Adjusted to inflation, that’s $225,692 and $391,208, respectively. Today, the average condo costs $720,143 while the average detached house can go for $1,377,482.
Rents have also jumped in the same period. In October 2000, the average one-bedroom rental in the Toronto area was $830 a month, according to the CMHC. Today, a one-bedroom apartment costs $1,439.
All sorts of different explanations have been offered as to why housing has become so expensive. Those of the right have blamed high immigration rates as well as rock bottom interest rates set by the Bank of Canada that have persisted since the 2008 financial crisis and continued with COVID-19. Those on the right have said that it’s all the fault of greedy developers only choosing to build “luxury housing” as well as (foreign) real estate speculators that hoard homes empty.
Many of these explanations have little to no merit and will be discussed in future blog posts. But there is one overarching root cause that can’t be ignored: we’ve simply stopped building enough housing.
It may seem like we’re building a lot of housing as everywhere you look, you’ll see condos under construction. But since January 2000, the Toronto area has seen an average of 38,254 housing starts, according to figures from Statistics Canada and the CMHC. That means each year, construction starts for 38,254 new units of housing.
However, between 2001 and 2016, The population of the Toronto area increased from 4,682,897 to 5,928,040. That’s an average of over 83,000 net new people per year.
How are we supposed to house 83,000 new people if we’re only building less than half of that amount?
For the next two months, this blog will examine the roadblocks that stand in the way of new housing supply that could go a long way when it comes to alleviating this crisis and offer commentary on housing-related news.
Thanks for reading and stay tuned for more content on the Angular Plane.
Photo credit: Martin Cathrae/Flickr/CC BY-SA 2.0
