As millennials age and demand for larger spaces, and baby boomers downgrade to detached homes, housing in Toronto will need more family-oriented housing units particularly in mid-rise and low-rise buildings, according to a recent study by the Ryerson City Building Institute.
In the past 10 years, GTA has experienced a decrease in the number of up-sizers in the rental market. These are tenants aged 35 to 44 who are looking for larger, family-friendly housing. According to the report Bedrooms in the Sky: Is Toronto Building the Right Condo Supply?, the trend will reverse in the next ten years as millennials age. From 2016 to 2026, tenants within the 35 to 44 age bracket is expected to increase by 207,000, driving higher demand for family-oriented units.
Meanwhile, the population of seniors or tenants aged 65 years and above is predicted to continue growing rapidly with an increase of 484,000 additional residents. As a result, the demand for single-family or detached homes will also rise.
AM640 real estate expert and Real Estate S.O.S. host Lou Berkovits agrees with the report. Talking to AM640 host Tasha Kheiriddin Nov. 7, he affirmed that the lack of family-friendly housing may indeed become an issue in the housing industry.
“There are a lot of people, not just a few thousand, but in fact hundred of thousands of people that need family-friendly condos and we don’t have them,” Berkovits said.
Moreover, the study also pointed out that the problem may not be just availability but affordability as well. In 2017, the price gap between an average detached home and an average condo apartment amounts to more than $600,000. With detached and semi-detached homes falling into a downward trend, the report says that prices will likely remain high with the price gap between condos and detached houses continuing to widen.
If current construction trends will fail to address the demands of GTA’s ageing demographics, family-friendly housing will become increasingly expensive for average-earning tenants.
Data for the study was collected by real estate developer Urbanation.