Every realtor knows the mantra “location, location, location”, and every homebuyer for that matter. But location, of course, is a relative word. After all, being located next to a prison or a landfill won’t do much for your home’s resale value. But there are a select few things that people will always pay more to live by, including efficient public transport. With real estate prices in Toronto climbing alongside the costs of owning a motor vehicle, it’s easy to see why homebuyers will fork over extra cash to be close to transit. Moreover, the aggravations that come with driving a car in the city - hard-to-find parking spots, steep parking rates, and headache-inducing traffic jams - have been pushing urbanites toward transit for years.
“The number one thing people will pay for is walkability to a subway station,” says John S. Andrew, director of the Queen’s Real Estate Roundtable at Queen’s University. “In Toronto you can draw concentric circles around subway stations, and you can see the further you move outward, the lower the property values are. For example, if you’re three blocks from Eglinton station, that’s like gold." (Check out this interactive map). But why is that?
The push to buy real estate close to transit is driven by some pretty big physical, psychological, and financial benefits. According to the Heart and Stroke Foundation, those who commute via transit are three times more likely to reach their recommended allotment of physical exercise per day than those who drive to work. If taking transit can help us be healthy, that's a pretty big incentive, right?
Then there's the mental benefits to consider; avoiding traffic jams, steep parking costs, and road rage, as well as having more time to do the things you want, can have a huge positive impact on your mental state and the quality of your daily life. We wrote about this in our blog, What Are The Real Costs Of Commuting? Add to that the knowledge that you are helping to lower our carbon footprint - that feels pretty good, doesn't it?
Financially speaking, the benefits are more straight forward. While Toronto is facing another small fare hike (to $3.25 per ride), the cost of running an automobile over long distances is substantially more expensive, and could effectively erode growth of your net worth over a period of time. Not to mention the skyrocketing cost of gas!
Interestingly, the push to be close to transit doesn't apply to residential real estate alone. Commercial real estate company Avison Young looked at buildings sold in Toronto’s downtown core from 2012 to 2015 and compared their sale price, slotting them into two categories: commercial buildings less than 500 metres from a subway station and commercial buildings outside that range. The result? Avison Young found that the towers closer to the subway station sold, on average, for $475 per square foot - a full 30 per cent - more than buildings further away. Read the full article here.
This reinforces the link between residential and commercial real estate and their influence on one another. The demand to be close to transit routes starts with workers, specifically millennials, who want to be near transit because they often don’t have cars. The companies who employ those millennials then seek office space near transit, which drives higher rents and ultimately a higher valuation for the properties.
So, what are the options for those who opt to travel by public transit in Toronto? In essence, what are people paying extra hundreds of thousands of dollars to have convenient access to?
The TTC is the primary mode of transit in Toronto, and comprises 4 subway lines, 11 streetcar routes and more than 140 bus routes. They also offer specialty services like Wheel Trans for those who are differently-abled, as well as the Blue Night Network for those traveling overnight. There are even transfer opportunities between several TTC services and the GO Transit commuter rail services. For full schedules, maps and fares, visit the Toronto Transit Commission website.
Image courtesy of the Toronto Transit Commission
A division of Metrolinx, GO Transit serves the Greater Toronto and Hamilton Area, with routes extending to communities across the Greater Golden Horseshoe, including 7 train lines. It is a favorite of those who commute from outlying bedroom communities like Ajax or Oakville. On average, 271,000 passengers ride GO transit daily to get to work or school, to go home, or to attend leisure activities. For full schedules and fares, visit the GO Transit website.
Image courtesy of GO Transit
The Union-Pearson Express
The newest addition to transit in the GTA, the UP Express connects the country's two busiest transportation hubs, Toronto Pearson International Airport and Union Station in downtown Toronto. We wrote about this in our post called The Union Pearson Express As A Toronto Staple. Happily, passengers can now avoid a frustrating, time-consuming and traffic-congested trip by car; UP trains depart Union and Pearson every 15 minutes, and the trip is only 25 minutes! For schedule and fare information, visit the UP Express website.
Image courtesy of the UP Express
“The feature that adds the most value to the home is nearness to rapid transit,” says Melanie Reuter, director of research at the Real Estate Investment Network. “That’s been backed up by research throughout North America."
Whether you're heading to the airport or just heading to work, proximity to the TTC is extremely important to Toronto homebuyers. Properties within walking distance of a subway station are generally more valuable than those on bus or streetcar lines, but the difference is becoming smaller as more and more Torontonians choose transit over driving a car, and available properties become more scarce.
Would you like to live near public transit?
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