About Places to Grow
If you’ve ever looked around your city and found yourself wondering where all these condominium buildings under construction came from, you might be interested to know that a lot of it stems from Ontario’s Places to Grow Act legislated in 2005, which was followed closely by the Growth Plan for the Greater Golden Horseshoe in 2006.
This act is the Ontario Government’s plan to encourage growth and development in a way that fosters economic prosperity, protects the environment, and helps communities achieve a high quality of life. As part of this act, the government has developed regional growth plans that help guide government investments and policies.
One prominent reason this act was put into place was to help curb urban sprawl commonly seen throughout some suburban areas where neighbourhoods aren’t connected, pedestrian-friendly, or easily accessible by public transit. Since the GTA is currently one of the fastest growing communities in North America, many of the large lots and even larger homes aren’t always the best option for housing this new growth.
What does this mean for communities?
It means you’re likely to see a lot more vertical growth, which means more condominiums. Condominiums will be the most popular and affordable type of new housing built throughout the Greater Toronto Area. Not only that, it means you’re going to see a lot more master-planned communities where you can live, work, shop, and play in a vibrant, self-sufficient neighbourhood. This makes for healthier communities where residents are encouraged to walk, shop locally, and mingle with their neighbours. It also decreases gridlock and traffic congestion.
If we look back to 10 years ago, we were building 80% low-rise and 20% high-rise. Well now all that has changed because today we’re building 70% high-rise and 30% low-rise.
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The Growth Plan Act consists of 3 significant components that have really changed how the building and development industry builds today:
- 2 million acres of land are reserved and protected in an area called the Greenbelt. This means that the building and development industry has to operate in accordance with the provincial plan. Developers are restricted from building on these preserved lands until 2041.
- Design complete communities, The Growth Plan has identified and targeted “25 urban growth centres” as regional focal points for accommodating population and employment growth. They will prioritize intensification in high density areas to efficiently use the land and infrastructure, while also supporting transit viability. 40% of this new intensification will be done in the downtown core.
- Housing demand issues play a big part for many communities who are facing housing affordability concerns. Demand can be driven by sustained population growth, low rental vacancy rates, and other complex socio-economic factors. The Growth Plan addresses this challenge by encouraging a mix of housing types, particularly affordable and high density housing that can accommodate a range of household sizes in locations with good access to transit and other amenities. This will make condos more attainable - and more affordable.
What does this mean for you as an investor?
The shift from low-density to high-density housing has been directed by provincial intensification policies that encourage a more sustainable approach to urban development. Homebuyers want to choose the type of home that suits their lifestyle throughout the various stages of life - and choice in the low-rise market is diminishing. Prices for the low-rise market is the highest it’s ever been, and it’s driving the buyers towards the high-rise market. Condos seem to be the only option for the first time homebuyer.
This means condominiums are the way of the future and will be in high demand. With a growing population, and growing employment opportunities along with it, many families, professionals and students will be seeking places to rent, and they’ll likely turn towards condominium units situated in vibrant, mixed communities.
In some parts of the GTA, such as Markham, we’ve already seen conditions where a huge employment boom combined with a lack of rental housing has led to wait lists, even bidding wars, for condominium rentals.
Once you factor in the green space, walking paths, and lifestyle amenities that will be at your fingertips, these urban communities aren't just fantastic places to live, but great places to invest in for the future.
The Growth Plan comes with certain restrictions
The Growth Plan also comes with certain restrictions that are intended to preserve regions of the province that are designated as “greenbelt” areas. This means that not only are developers restricted to building in certain areas, they are also restricted to what kind of structures they can build. Anticipating exponential growth in population and employment opportunities in the GTA, these structures are encouraged to be mostly condominiums. With these vertical communities, the act focuses on:
- Revitalizing downtowns to become vibrant and convenient centres.
- Creating communities that offer more options for living, working, shopping, and playing.
- Providing housing to meet the needs of people and families at any age.
- Preventing sprawl and protecting greenspace.
- Reducing traffic congestion by improving access to a variety of transportation options.
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