As I move into my 26th year as a realtor - trading in property across the central core from The Beach west to The Kingsway, and from Harbourfront north to Hogg’s Hollow - I've witnessed an enormous change in the 42 city neighbourhoods which encompass my business. I've experienced this change both historically - through my undergraduate research and graduate thesis - and through my experience in the real estate trenches. 'Shelter' in Toronto continues to change and evolve, which is part of what makes my career so fascinating and of interest to me.
My expertise as a realtor is rooted in the ten years I invested learning about housing at York University including a Canadian Social History Degree that focused on the migration patterns of the city's cultural groups, with an emphasis on how they influenced Toronto's housing market from 1850 to 1970; an Urban Studies Major where my thesis - funded by the Ministry of Municipal Affairs - focused on Gentrification in South Riverdale in the 1980s; and my 1993 Graduate Degree in Environmental Studies that researched the development of Adaptive Re-use Conversions into loft condominium living, which included a fascinating psychographic analysis of its residents.
Here's a brief overview of my insights and observations as a realtor, as they relate to the history of Toronto real estate. In particular, I'm interested in diasporic settlement patterns, gentrification, and the evolution and lifecycle of neighbourhoods!
Toronto: The City Of Neighbourhoods
Toronto has long consisted of multiple micro real estate markets, each oscillating symbiotically. Predominantly based on income, class, and ethnicity, Toronto's neighbourhoods were originally formed by many waves of immigration - from the 1850s onwards through post-WWII - which effectively reshaped the urban landscape. For example, while the Anglophones migrated up Yonge Street from Rosedale to Lawrence Park and northwards, the Jewish community - which had its roots in Kensington Market - moved up Bathurst Street to Forest Hill and beyond, while the Italians went northwest from College Street to St. Clair Avenue and up to Woodbridge - each over a succession of generations. The Asian communities have settled - not in trajectories - but in nodes, like Chinatown on Spadina Avenue, Gerrard and Broadview, and more recently (and in significantly larger numbers) to Richmond Hill and Markham. The Portuguese moved northwest, while the Eastern Europeans - who bought the dwellings in Roncesvalles Village from the Scots a century ago - scattered as they assimilated, though their cultural imprint remains strong in Bloor West Village. As each cultural group became established, and then expanded in size and affluence, so have their locations and types of shelter! With stability came wealth, and suddenly there were also pockets of the city emerging that were carved out specifically by based on affordability and financial status. That said, for decades, social groupings remained the standard for geographic delineations.
At one time, where one lived in Toronto was highly dependent, not only on one's cultural affiliation but also one's social standing; the location and type of shelter you inhabited were pre-determined by fairly strict societal norms. Single people rented rooms as lodgers or lived in their place of birth in multi-generational households until they married and bought their first house. Houses were (nearly) the only dwelling type for ownership available until the 1980s. In Toronto - our beloved "City of Neighbourhoods" - most of what was constructed south of St. Clair Avenue during the late 1800s thru 1920s was built of the simplest pedigree. Brick and frame constructed two-storey row homes, two and a half storey semis, and detached working-class cottages dot most of our inner-city streets. With the exception of The Annex, Rosedale, Riverdale/Playter Estates and pockets of the central west end - like Palmerston, Dufferin Grove, Beaconsfield Village and Parkdale - the majority of our housing wasn’t constructed for the affluent, but for the working and merchant classes immigrating to the city. And in the early suburbs - fanning the central core - the housing stock continued to be built for different levels of affluence. There were also instances where, as in this piece written by John Lorinc, 'Restrictive Contracts And Bigotry Lingered In Toronto Real Estate' attempts were unsuccessful to segregate cultures.
Toronto Real Estate Through the Years
Through the better part of the 1900s, Toronto's housing stock remained much the same (albeit often divided into multi-units), while the cultural makeup of the neighbourhoods shifted. As new immigrants fanned throughout the city, the social fabric of the inner city changed while the existing housing stock and its fairly cheap property values did not. In pockets where the housing stock became obsolete and decrepit, the 1950s and 1960s solution to this visual blight was "blockbusting" through political initiatives. Huge swaths of downtown's perceived ‘ghettos’ - particularly Regent and Moss Park on the east and Alexandra Park on the west, amongst others - were torn down and replaced by social housing. This was intended as a means to provide better shelter for a large subset of the population and arguably better quality of life. For an example of what I mean, here's my in-depth look at one social housing initiative in particular: The History And Revitalization Of Toronto’s Regent Park Neighbourhood.
It was the mid-twentieth century that Toronto saw a huge change in its urban landscape. Swelling under massive population growth, parts of the city began to reform, and higher population density gave birth to new housing types. Not only was this massive growth a major proponent in the creation of social housing, but it also incited the ascension of the high-rise rental market in the 1950s through 1970s; this new housing frontier quickly became home to a generation of swinging singles of every culture, challenging the conception of domestic arrangements and forever changing traditional domestic household structures. As a generation postponed marriage and child-rearing, a demographic shift in housing occurred; singles began renting in complexes specifically catering to them, instead of remaining in the family home until marriage. This is when the ‘bright lights, big city’ love affair (think Mary Tyler Moore in her 70s sitcom) of downtown living began. I document an example of this trend succeeding and then failing in my post, A Mini-History on St. James Town. This boom took place both within the downtown core - as you can see in the mid and high-rises in The Annex, Yonge/St. Clair, Bathurst/Eglinton, High Park and across East York - but it also exploded in the suburbs. Many of these towers today are in a state of decay, which has prompted new initiatives like this post on my Student Mentorship site Houseporn.ca called The Tower Renewal Project In Toronto Led By ERA Architects.
I'll talk more to the movement to increased density in 'The Arrival Of The Condo', but in the meantime, let me address the evolution of gentrification in Toronto.
How Gentrification Gained Momentum
There have been an array of explanations for the rise of gentrification since its substantial impact in the 1970s. These include a growing rejection of the suburbs for its architectural homogeneity and cultural sterility, as well as the time and congestion associated with highway commuting. The changing household structure of fewer children and two-income wage earners - including the growth of a gay subculture and non-traditional living arrangements - also contributed to making traditional suburbia less desirable. And last but not least, the growth of white-collar service activities in a financial epicentre (read: Financial District & Bay Street), and dispersion of manufacturing enterprises, which, up until that point, had largely defined the downtown and waterfront communities.
Beginning in the 1970s, urban neighbourhoods like Cabbagetown - encompassing North America's largest collection of Victorian architecture in the shadow of St James Town's highrises - began to transition. However, the change was not guided by ethnic composition, but by economic status. White-painters (originally called such because they painted the interiors and exteriors of houses white) and other middle-class buyers began moving into poorer neighbourhoods, purchasing the real estate for cheap and then upgrading the housing stock. In addition to necessary mechanical and building component upgrades, these early adopters deconverted many multi-family dwellings and rooming houses back into single-family homes, restoring their original architectural features and parlaying them into profit. As their popularity grew, the influx of the middle class began to follow over the next 4 decades, claiming the inner city as their own. This was the inception of gentrification, as we know it.
Gentrification has sometimes gotten a bad rap, as a movement of wealth into a neighbourhood that displaces poor, long-term residents. This isn't necessarily the case as is outlined in this article from the Economist: "In Praise of Gentrification". . Gentrification isn't just about the wealthy having the opportunity to snap up real estate at a lower price; it is about the current residents benefitting from the social and financial improvements that come as a by-product; current homeowners would see their property values rise. According to the study referenced in the article, contrary to popular belief, most people are not displaced when gentrification unfolds. In fact, many more stay in place compared to poorer neighbourhoods that don't experience gentrification. There is also the benefit of increased social services, policing and amenities, which enrich lifestyle. The argument of course is that gentrification does little to help with affordability in high-priced cities because it evolves the "affordable" into the "unaffordable". While this argument could be applied to Toronto, there is no question that gentrification is a fundamental fabric in the history of Toronto neighbourhoods.
I know much of this history from my own contribution to housing research in the late 80s, when I wrote an Urban Studies Thesis funded by The Ministry Of Municipal Affairs called "Gentrification: Yuppie Porn In South Riverdale". My thesis explored both gentrification and my early fascination with housing as a symbol of self. As part of my research, I wanted to explore the connections, if any, between a dwelling's occupants and its facade. By assessing the housing stock according to their exterior impressions in a manner relevant to the times, I classified the houses as being in either original condition, upgraded condition, renovated or, if deemed a total sparkly showcase, bestowed my own personal "Yuppie Porn" classification. "Yuppie Porn" houses, which were relatively rare in South Riverdale in the 80s but have become an increasingly common staple in a neighbourhood (and city) of tired one-hundred-plus years old buildings, are those which have undergone a substantial professionally-executed quality restoration/renovation. Typically the building components are all-new while as many original character details of the dwelling have been respectfully restored. Think chemically cleaned brick exteriors, architecturally-appropriate windows, wrought iron fencing, smart lighting, custom landscaping and stylish house numbers of the finest calibre. After cataloguing the housing stock according to this and other criteria I delivered direct mail surveys to the residents requesting details on their age, ethnicity, education, income, occupation and household structures.
The results were a fascinating indication of current and future housing trends. My research analysis quantified the original and upgraded housing stock as being principally occupied by long-time Anglo working-class residents and Asians immigrants. Those houses which had varying degrees of renovations tended to be owned by more recent residents, who had made the purchase based on affordability, and a willingness to complete the all-apparent do-it-yourself renovations. Conversely, the Yuppie Porn houses were, without exception, occupied by highly-educated high-earning professional couples with no children, who had neither the time nor inclination to renovate. These upwardly-mobile, income-rich and cash-poor Yuppies were leveraging themselves onto the property ladder to their max; they were acquiring the properties that were the most luxurious, in need of the least work, and as close to the financial core as possible (within their own limitations of affordability). The one compromise this subset of property owners were willing to make was choosing a location which, although convenient to work, was marginalized by the dilapidated properties that surrounded their new castle and, in some cases, proximity to the remaining toxic, noxious industries to the south. For more insights on South Riverdale - and the east side of downtown - here's my popular post called Why Toronto’s East Side Real Estate Has Historically Been Cheaper.
Incidentally, South Riverdale was the location of my own first purchase back in 1986 when my partner and I bought a barely habitable cat-sprayed cockroach-infested symphony-in-pink two bedroom semi for $87,000 (I'm pictured on the front porch above!) It was a definite contender for being the cheapest house in the entire city and, as a full-time university student slash waiter, was one of the few properties available within our shoestring budget. Yup, at the tender age of 21 I gave myself up for the overwhelming satisfaction of homeownership by purchasing the only house we could afford that didn't contain tainted urea-formaldehyde insulation. Elated and aspirational with desire from the point of purchase until closing, on moving day my mood dramatically changed at the horrifying realization of what we had done. Walking into a crappy decrepit property with absolutely zero redeeming features and an extensive list of must-dos (including the vomit-inducing stench of cat urine), despite my brave face and stiff upper lip, within the hour of getting the keys I was already distraught. By the next morning, having awoken to a lashing thunderstorm which had ripped off a section of the poorly patched roof leaving raindrops and tears pouring in the kitchen, I succumbed to the daunting realization we had bitten off more than we could chew. Whatever momentary pride I might have fleetingly held under the sanctity of homeownership, within 72 hours I had to concede defeat by wailing to my partner how I simply could not live there. Three weeks later, with a lot of sweat equity and a $3000 cash advance on the newly-acquired Visa that accompanied our entree into the exclusive perks of homeownership (here, have some more debt!), we sold our $87,000 house for $121,000. This misadventure would signal the beginning of my climb up, down and laterally along a property ladder which, over a span of twenty-five years has crisscrossed seven Toronto neighbourhoods, both Canadian coasts, and currently totals 19 personal residences (here's my latest project in The Tales From Tennis Crescent). Despite the tears, frustration, and the occasional "Why the hell do I do this?" proclamations, I cherish how putting my own personal stamp on 'Home' satiates and honours my creative expression. After 24 years since losing my real estate virginity to my first home on DeGrassi Street, perhaps one might say I had A Nose For Leslieville?
The rebirth and rejuvenation of our urban landscape is an interesting phenomenon that, with careful analysis, can be predicted; there are several clues as to which Toronto neighbourhood will rejuvenate next (you can start by seeing how closely your potential property purchase aligns with these 7 Factors For A Winning Location). However, while gentrification narratives have historically focused on the displacement of the poor, as we've moved into a global economy where money has no borders, gentrification is no longer about the middle class displacing the working class; it's now about new levels of affluence putting down stakes amidst the existing occupants of any location. I explored this phenomenon on my site Houseporn.ca in an article about Forest Hill, a wealthy midtown neighbourhood which was once predominantly Jewish. Today, houses are being purchased for $4mil and being torn down, only to see monster houses going up in their place and selling for $15mil to foreign residents from Asia and Russia. For a fascinating insight into the culture wars of shelter, A $15 Million Mansion In Toronto’s Tony Forest Hill shares how even the old-monied Toronto elite are having their status usurped by the arrival of massive monster homes; in this twist of events, canyons of grey stucco now overshadow even the largest vintage manses, and render the old-money yards, pools, and cabanas devoid of sunlight. That's right - even Toronto's rich are being marginalized by the Super Rich in this day and age! What's important to note, however, is that when an established centrally-located neighbourhood is seeing original houses being torn down and new ones being constructed in their place for price tags which are two or three times higher in cost, the new precedent-setting values create a ripple effect in all the surrounding neighbourhoods and beyond, setting a new bar on how expensive (and how big) future new build properties can be. In fact, this is exactly what is happening in the original City of Toronto.
The Arrival Of The Condo
Another contributing factor to the rejuvenation of inner-city housing stock has been a necessity, as most of our shelter has surpassed its life expectancy. Most of the homes are at least one-hundred-plus years old, and enormous investments of capital have been required simply to bring them up to building code. Throughout my career working largely in the inner city, the properties with the lowest acquisition price almost always require a substantial amount of improvements, particularly as insurers are resistant to properties containing components like old knob-and-tube wiring and insulbrick siding. As a result, both financial institutions and insurance firms often require buyers to upgrade the homes in question, which in turn pushes costs up beyond the affordability index of many. Consequently, most first-time buyers simply cannot afford city houses retrofitted to building code. Fortunately, the arrival (and acceptance) of the condominium - which has been the entry-level alternative for downtown living since the 1980s - has played a significant role in housing affordability for singles and couples.
This housing type coincided with the boom of multi-ethnic first-generation Canadians - often higher-educated professional singles and childless couples - who were renting in the city core, and decided to stay. Unlike American cities, which more often experienced the flight of the middle class to the suburbs, Toronto always retained a diverse population of all types of urban dwellers (Thanks, Jane Jacobs!). As singles and childless couples, the baby boomers sought affordable downtown housing, and the condominium emerged as a viable ownership option - particularly for first-time buyers. Given its reputation as a less-desirable form of shelter prior to the 70s and 80s, it's amazing that, in 40-ish years, the condominium has become the dominant housing type in Toronto's downtown core. Isn't it incredible to consider that, within the span of my career, the urban fabric of Toronto has changed so dramatically?!
(If you love architecture, here's my blog on how the facades of condos have changed since the 1980s in The Face Of Toronto Condo Living. Also, to see how much condos have boomed, here's an article from April 2017 in The Globe & Mail which shares "Toronto's Five Decades Of Condo Growth, Mapped").
Shooting up amidst a fabric of low-density houses and mid- to high-density rental apartments, the condo high-rise and stacked townhouse began offering an affordable equity building urban alternative to those delaying (or dismissing) the need for a conventional family property. Today, the ongoing densification of Toronto is largely owed to these modern housing types that offer alternatives to singles and couples; they've created the opportunity for a larger population to enjoy vibrant urban lifestyles, and have contributed to the all-around success of a city touted for its unique livability. Concurrently, in the original vintage downtown housing stock, family life continues to foster a new generation of Torontonians, making this city one of the globe’s most socially and demographically well-integrated urban centres. Interestingly, given the high cost of housing, over the past 8 years, there's been another generational shift in high-rise living; the condo is now being embraced by young families raising children, as I explored in Dear Urbaneer: Should We Raise Our Kid In A Condo?. If you're in any way engaged in the Toronto condominium market, here's an excerpt from my recent Toronto real estate forecast, called Here’s What’s Happening With The Toronto Condominium Market.
The Densification Of Toronto Neighbourhoods
While most of the city's urban neighbourhoods today reflect the incomes and demographics of its residents, when I first started selling real estate in Toronto, it was still largely cultural heritage that defined the flavour of our downtown residential fabric. In fact, the distinct residential differentiation of ethnic ownership in the city's freehold housing stock lasted well into the 1990s, until the ageing original immigrant residents (or their children) eventually sold their family homesteads to new buyers; these new owners were often younger professional first-generation Canadian singles, couples, and families. I'm still seeing some of this today, but it's not as common as it once was. As a shelter fanatic, I do miss those decades when I would show prospective buyers homes owned by different cultures. The furnishings, photos, and knick-knacks were rich with personal history, the decor was culturally specific, and the gardens, cantinas, and kitchens filled with distinct aromas. (The two snaps below - of an estate sale that sold just last week near Trinity Bellwoods Park will give you an idea of what I mean!) Sadly, a lot of this tradition and uniqueness is evaporating due to the homogeneity of today's busy, affluent, 'order-in', 'on-trend', 'big-box-store', 'on-line' living that we see furnishing real estate listings today, regardless of whether they're staged or not.
Nearly two decades ago, in an interview for a Global television newscast, I was asked what the city’s hottest neighbourhoods were. My response became the television commercial for the segment. “In the 70s it was Cabbagetown, in the 80s it was Riverdale, in the 90s it was College Street, and for the new millennium it’s Roncesvalles Village!” Since then, as urban densification and intensification reshape the city, so too has gentrification progressed through the fringe neighbourhoods which have already been transformed through rebirth. The Junction, Wallace Emerson, and Brockton Village are rapidly emerging, while The Danforth is about to see its Main Street crossing become a canyon of much-needed condominium mid-rises. Click here to read the History On The Intensification Of The Danforth In Toronto.
St. Clair West - where shop owners were economically slaughtered by the ongoing construction of the LRT, leaving a trail of out of vacant commercial sites ripe for redevelopment - is undergoing a reinvention, a process which will only intensify - along with Eglinton Avenue - when the Crosstown LRT is up and running. If you're looking to make a savvy long term investment, you'll want to read my post on The Eglinton Crosstown LRT.
If you're on the hunt for an affordable house, those which will offer the highest returns are situated on or near major arteries, with immediate access to public transportation, shops, and new or proposed condominiums. The success of an urban neighbourhood today needs condominiums in proximity, as they provide a large diverse population keen to support local amenities. So, to buy in a neighbourhood that will see more condominiums built, pretty much assures your property will increase in value, both because the existing local amenities will be used, improved, and coveted, and because all those condo residents looking out their windows at your house will, for the most part, wish they owned it! And, if you're a condo buyer, the most desirable condos (with a solid investment upside) are those in village neighbourhoods where there is a limited supply of condos (both currently and on the horizon). In other words, the less there is of a similar product to what you buy, the more valuable your property will become. Incidentally, this applies to specific architectural features and finishes too, like high ceilings, an intelligent space plan, lofty styling, a protected view, or a generous terrace.
The Market Of Multiple Buyer Profiles
For a century, the strength or weakness of the city's real estate market was dependent on its local industrial economies. Basically, the ability of Torontonians to afford housing was based on income and wages that were defined by the general prosperity of the area. This determined whether a neighbourhood was healthy or in decline, with limited impact by external forces. I know I'm over-simplifying this, but, the fact is, in places which remain highly dependent on limited economies, the real estate market is more vulnerable to booms and busts. Although Toronto has long been a major driver of Canada's economic engine (with resource economies driving other regions of Canada), I believe the city has now reached a tipping point where there are significantly more target markets of Buyers competing for real estate. In this new millennium, we have a greater spread in affluence, including the biggest transference of wealth from one generation to another, an exploding 'post-industrial' global economy which includes a new 'creative class', an easy flow of international capital, and all of it married with the speed of the internet and its instant access to information. All of this inevitably spurns faster sales, and fuels the social Fear Of Missing Out. Here's my still-true piece called Why Is The Toronto Real Estate Market So Hot?
Today, each of Toronto's multiple real estate markets continues to oscillate in their own push/pull dynamic, at times losing ground to competing markets which can afford more than another segment of buyers. For example, a down-scaling couple nearing retirement may outbid a young family by offering a higher sum for the same downtown 2bed condo, or an end-user may pay more to secure a multi-unit dwelling for their multi-generational family than an investor seeking a certain cap rate. Sadly, it's not unusual to see the glass ceiling play a role as well; a male first-time buyer often snaps up a brick and beam loft because his income qualifies him for a higher purchase price than a single woman in the same profession whose income for the same position is less than her male counterpart. Similarly, privilege is a factor, like when a young trust fund kid can outbid the professional tech import, simply because the Bank Of Mom And Dad is gifting a pre-inheritance. And this is all compounded by the fact that the Toronto market is attracting foreign investment, such that there's a lot more capital flowing into our housing market, to the point that it is changing the capacity for the local market to compete regardless of government interventions. There are a lot of factors which have contributed to the escalation in values which, although tempered somewhat by the government interventions and mortgage stress tests, are still present. I cover this in my post called 7 Reasons Why Toronto Real Estate Prices Have Skyrocketed Over The Past Decade.
So where does that leave us? The Toronto real estate market has evolved into a complex fabric of competing forces battling for shelter which are subject to countless mitigating trends and influences. As the city grows under a global spotlight - fueling multiple micro markets - what's clear is there remains a lack of supply of all types of housing, but in particularly affordable housing (which I believe requires government initiatives through policy as the free market will not). As a realtor who operates within the central core of the city amongst 42 neighbourhoods, while the market may be influenced in our near future by the availability of credit, interest rates, and inflation until the lack of supply - in particular freehold housing - is addressed the Toronto real estate market will remain a solid long term investment. For more insights on Toronto real estate, here's my Urbaneer Summer 2018 Toronto Real Estate Forecast in Part One and Part Two!
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Thanks for reading!
With a multi-disciplinary education in housing and decades of experience in Toronto real estate development and resale markets, I have a unique perspective on Toronto’s housing market. May my team and I be of assistance? Please know we’re here to help without pressure or hassle!
~ Steve & The Urbaneer Team
Steven Fudge, Sales Representative
& The Innovative Urbaneer Team
Bosley Real Estate Ltd., Brokerage - (416) 322-8000
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