GTA woes: Transit top concern for residents; housing costs threaten to push millennials out
Nearly half of those 18 – 34 considering leaving due to high housing prices.
September 4, 2015 – The Economist may have recently named Toronto one of the world’s most liveable cities, but a new survey from the Angus Reid Institute shows people living in the GTA are increasingly preoccupied by – and worried about – living, working, and getting around in the region.
A significant majority of the region say they don’t believe that the next generation will own a home; while close to two-in-five say they’re considering cutting their losses and moving away to avoid skyrocketing housing costs.
- Transit tops the list of most important issues, with 54 per cent
of GTA residents naming it in their top two.
- Among those who commute in the region, almost six-in-ten (58%) spend more than half an hour each way going to school or work—these commuters also report a higher level of transportation pain.
- Almost half (48%) of those 18-34 years of age are frustrated with their commute, but say that they cannot afford to live any closer to their place of study or employment.
- Six-in-ten GTA residents (61%) say high housing costs are hurting the Greater Toronto Area, almost four times as many as say they’re beneficial for the region (16%).
- More than eight-in-ten (84%) GTA residents are worried that the next generation won’t be able to afford a home in the area.
- A majority (57%) of GTA residents say government should be more involved in the housing market, and 60 per cent say its goal in doing so should be to help first-time buyers, rather than to protect values for current owners.
Transit: the top issue
Transportation has been a mainstay in Toronto news in recent years, provoking considerable debate at the provincial and municipal government levels. During the 2014 municipal election, each mayoral candidate in the City of Toronto put forward their own vision to tackle congestion on roadways and inadequacies in public transit. Ontario Premier Kathleen Wynne also made investment in transportation a priority during the last provincial campaign—promising more than 29 billion in spending on transit alone.
Asked what they consider the most important issues facing the Greater Toronto Area, more than half (54%) of GTA residents surveyed selected transportation issues, putting it at the top of the list. The economy and jobs was cited as a critical regional issue by four-in-ten (40%), with housing prices and affordability placing a strong third, selected by 36 per cent of GTA residents surveyed.
Housing is of greatest concern to younger GTA residents (aged 18 to 34). This group is far more likely than older residents to name it as a pressing priority—indeed, they put it in the same league as transportation (46% of this age group chooses housing; 49% transportation).
A look at commuting in the GTA
It’s no wonder people are concerned about transportation. The average delay on a 30 minute commute in the GTA is estimated to be about 23 minutes per day. In fact, congestion in Toronto rates in the bottom-third of 147 comparably sized cities around the globe.
This ARI poll asked GTA residents how much time they spend commuting, on average. Among those who commute (29% do not), nearly three-in-five (58%) report doing so for 30 minutes or more. This includes 12 per cent of all commuters who spend an hour or more travelling to work or school each day:
Car people vs. others
Broadly speaking, the data suggest that there are two kinds of commuters in the GTA: young people living inside the city who largely rely on public transit and have incomes below $50,000 annually; and older, higher income earners who commute by car.
Commuters in the GTA overwhelming rely on their cars, with 41 per cent saying that they use their car “every day” compared with only 15 per cent who same the same about public transit.
Younger people—most of whom are either just starting their careers or completing their studies in the GTA—tend to have the lengthiest commutes. They tend to live farther away from their destinations, and unlike wealthier and older groups, they are less likely to drive their own vehicles. Half (50%) of those aged 35 to 54 and 43 per cent of those over 55 drive a vehicle to get around, compared to just over one-quarter (27%) of 18-34 year olds.
Household income also plays a role. Roughly two-thirds of those with household incomes of $50,000 or higher rely primarily on a vehicle for transportation. This number drops to one-third for those earning less than $50,000.
Satisfaction getting around?
In general, GTA residents are satisfied with their own personal experiences of getting around, but they see the transportation experiences of others in the region as painful.
Survey respondents were asked to rate how easy it is to get around on a 5 point scale, with 5 being “very good – easy to get around” and 1 being “very poor – painful to get around.”
Close to half (48%) say their own personal experience getting around is easy – a 4 or a 5 on the scale. Respondents are also largely satisfied with transportation generally within their own cities and towns in the GTA (41% choose a 4 or a 5 on the scale for this).
When asked about the ease of getting around the region as a whole, however, nearly half (46%) see the experience as painful, choosing a 1 or a 2 on the scale. This is more than twice as many as choose a 4 or a 5 (21%):
Satisfaction with transportation and where one lives in the GTA
The connection to satisfaction becomes clearer still when we look at commute time by where one lives. The following graph illustrates satisfaction with one’s personal transportation based on where in the GTA region one lives:
The majority (55%) of those who neither live nor work in Toronto rate their ability to get around as “good,” or “very good.” Similarly, close to half (47%) of those who live and work inside the city of Toronto rate the ease in getting around as “good” or “very good”.
By contrast, satisfaction drops to roughly four-in-ten (42%) of those who live inside the city, but work outside. This is closely followed by those who work in Toronto but live outside it, who are the least likely to rate their personal transportation experience as good (39%).
Life on and off the subway line
Within the city boundary, roughly half (52%) of the population lives on a subway line. This poll finds most Torontonians who live on the subway line (54%) find it easy to get around, and this number drops a full 15 points among those not living on the subway line:
Why not just live closer?
This raises an important question: If it’s so hard to get around, why not just live closer to where you need to be? When asked whether they agree or disagree with the statement “I’m frustrated with how long it takes me to get to school or work but I can’t afford to live any closer,” 35 per cent of those surveyed in the GTA agree.
The picture becomes fuller still when we factor in where people live and work. Fully two-thirds (66%) of those who travel into Toronto from outside it say they are frustrated with how long their commute takes, but can’t afford to live closer. Likewise, 62 per cent of those who commute to work outside the city from inside agree with this statement.
But a majority (65%) of those who live and work outside the city do not share this opinion:
I want a better lifestyle or more space
Still, many of those surveyed say they made the choice to live where they lived based on an altogether different calculus—one that had less to do with length of commute or affordability, and more to do with space and or lifestyle.
In fact, 76 per cent of respondents agree with the statement “I choose to live in my community or city because I prefer the lifestyle here,” and this varies only modestly for residents of Toronto (73%) and folks living elsewhere in the GTA (79%).
As well, 73 per cent of those living outside the city agree with the statement “I don’t live in Toronto because I have access to more space for the same or a lower price in my community or city.”
Housing in the GTA
Looking at housing in the GTA, we get a better picture of what’s underlying some of these choices.
Housing prices in the Greater Toronto Area have been rising steadily since the housing bubble burst in 1989 and recovered in the mid 1990’s. A detached house in the 416 area code now sells for an average price of more than $1 million. Prices in the surrounding 905 area code are less outrageous, but have still seen a jump to about $650,000 on average.
Benefit and Pain of High Housing Prices
When asked whether current housing prices are benefitting or hurting the GTA as a whole:
- Fully six-in-ten (61%) GTA residents surveyed say high prices are hurting the GTA, with one in four (25%) saying they’re hurting the region a lot
- Almost half (47%) say housing prices are hurting the community or city where they live (14% say a lot)
- At the personal level, asked what impact these housing prices are having on them (and their households), just over one-third (35%) say they are being hurt
- By contrast, fewer than one-in-five (17%) say high prices benefit the GTA somewhat or a lot, while one-in-four (25%) say their communities benefit
- One-quarter (24%) say that they personally benefit (either somewhat or a lot) from high housing prices
There are stark differences on this question depending on whether one owns or rents their home. Specifically, fully 57 per cent of non-owners maintain they themselves are hurt by high prices. This view is shared by a much smaller number of home owners (35%), who are more likely to say they are benefitting from the high prices.
Indeed, almost eight-in-ten owners (79%) agree with the statement “I basically ‘hit the jackpot’ by getting into the market at the right time.”
This doesn’t mean all home owners in the GTA are carefree when it comes to the housing market, however. A majority (54%) report having mortgages on their homes. Roughly one-in-six of homeowners (16%) report that their mortgage either “makes things tight” and curbs their lifestyle (13%), or makes it “a real struggle to make ends meet” (3%).
By another measure, exactly half of GTA home owners (50%) find it difficult. This group agrees with the statement, “We have had to make real sacrifices to be able to buy in the Greater Toronto Area.”
Are the prices just too high?
Talking about pricing more generally, there are again differences between the outlook of those who own and those who rent. Only 15 per cent of homeowners believe that the price of their own home price is unreasonably high, but, that number jumps dramatically when they are asked to evaluate homes prices in their community (32%) and in the GTA as a whole (63%). Understandably, a full four-in-ten (42%) non-owners say they would like to buy a home now, but can’t afford it.
Non-owners feel priced out
Those who don’t own their homes are acutely aware of the problem of high housing prices in the region. While roughly one-fifth of this group (22%) is not interested in buying a home, maybe ever, most would like to buy at some point. This includes:
- 32 per cent who would like to buy a home eventually, but not yet
- 42 per cent who would like to buy a home now, but can’t afford it
Widespread concern over housing
It’s not only non-owners who are concerned about housing prices. Rather, the concern appears to be generalized over the population, regardless of one’s personal status in the real estate market. Consider these responses:
- When asked about the future, an overwhelming 84 per cent of those surveyed agree with the statements “It is unrealistic for young people to expect to own a house and a yard in the GTA,” and “I’m worried the next generation won’t be able to afford to own a home in my community.”
- Fully nine-in-ten (90%) GTA residents agree that “the idea of holding a mortgage on a million dollar home is terrifying”, (67% strongly agree).
Raising the housing alarm
This new region-wide ARI survey has some potentially disturbing findings for those promoting the GTA’s continued success as a fast-growing North American metropolis. These include:
- Fully four-in-ten residents (39%) agree with the statement “I’m seriously thinking of leaving the GTA because of the cost of owning a home here.” The highest levels of agreement are found among younger people (those 18 to 34 years of age), and non-owners: 45 per cent of each group agrees.
- Similarly, fully two-in-three (65%) residents disagree with the statement “I don’t care about the prices of homes in the GTA – I don’t want to live anywhere else.”
What (or who) is to blame for high housing prices?
When presented with a list of potential causes for the high housing prices in Toronto region, the largest number of respondents opted for “people want to live in the GTA because it’s a desirable location”. This was followed by low interest rates.
Other more popular reasons include: foreign and high wealth investment in the real estate market; lack of government action on housing, as well as lack of land available for construction, and the lack of rental housing builds.
Turning to separate these results between owners and non-owners we find a not so subtle shift in ordering with home owners ranking low interest rates second at 55 per cent, and high wealth and foreign investment in the real estate market third and fourth respectively.
Non-owners place high wealth investment second (34%) and fewer select interest rates as being important (27%). Non-owners are also more likely to attribute “lack of government action on housing” as a cause (32%) compared to owners (13%).
What should be done about it?
More than half of GTA residents are dissatisfied with their government’s policy on housing, both at the provincial and municipal level. Overall, 56 per cent are dissatisfied with their city government on this file and 63 per cent say the same when looking at their provincial government’s performance.
With that in mind, the Angus Reid Institute asked where priorities should lie in addressing housing policy, more specifically, “suppose you were completely in charge” – whose interests should be given priority?
With this forced choice, a clear majority of 60 per cent said the government should give highest priority to “first time buyers wanting to get into the market”. The opposing 40 per cent would prefer priority be given to “current homeowners wanting to protect the value of their investment”.
Breaking the numbers down further by location we see that support for first time buyers’ interests is highest among those who live in the city (66%), and the number declines the further out you go, resting at 54 per cent among those who live and work outside of Toronto.
Likewise, support for making first time buyers the priority is split 50/50 among homeowners, but that number rises to 76 percent among non-owners.
Notably, support for first time buyers is also higher among young people; with 67 per cent of those 18 to 34 years old in support.
Shachi Kurl, Senior Vice President: 604.908.1693 email@example.com
Image Credit – Jamie McCaffrey