Photo: Pablo Cabezos/Flickr
Toronto has been dubbed “New York North,” in part for its cosmopolitan hustle and bustle.
A lobby group representing homebuilders across the Greater Toronto Area has another comparison in mind, though, and for considerably less glamourous reasons.
The Building Industry and Land Development Association (BILD) is cautioning that crumbling affordability puts Toronto on a course to becoming a housing market like London or Silicon Valley’s Palo Alto, two super-expensive markets where homeownership is out of reach for many.
“(The GTA) is a growing region and people want to live here but the lack of housing, especially low-rise homes, keeps pushing prices higher,” writes BILD in a blog post titled “Lack of housing supply and eroding affordability challenge the GTA.”
“Like London and Palo Alto the demand for housing is greatly outstripping the supply of housing that is available,” it continues. And the similarities don’t end there, according to BILD.
Many of the causes for the GTA’s skyrocketing home prices — where dwellings (including condos) cost an average of $755,755 in September, up 20.4 per cent year-over-year — are like those pushing residential real estate values to stratospheric levels in the other two markets, the group says.
“Complicated and restrictive government policies, already lengthy yet still worsening approval processes, a shortage of shovel-ready and approved land on which to build, escalating land prices and the growing issue of NIMBYism are impeding our ability to build homes and communities,” says BILD.
“We don’t want to be a London or a Palo Alto. In the GTA, we need to work together to address the growing challenge of inadequate housing supply so that we can better meet the region’s housing needs and offer consumers choice,” BILD writes in the blog post, published this week.
In Palo Alto, the median home price for currently listed dwellings is $2,496,500, in US dollars (about $3,328,833 in Canadian funds) according to Zillow. On average in August homes in London cost 580,930 pounds, or about $942,036 Canadian dollars, reports Bloomberg.
Kate Downing, a member of the Palo Alto Transportation and Planning Commission, recently made headlines for quitting the job because owning a home and putting down roots there was too expensive.
“After many years of trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here,” Downing wrote in her widely circulated resignation letter.
She is a lawyer and her husband is a software engineer.