Moving away ... and not coming back

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Search for affordable housing triggers exodus from Toronto

Meghan Bennett and her husband, Yonge Au, decided they were leaving Toronto after the birth of their son.

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Although they had an affordable, rent-controlled two-bedroom apartment in Toronto’s Cabbagetown neighbourhood, it was clear they needed more room.

“I work from home 65 per cent of the time, so our son’s room was also my office,” said Bennett, 38. “We knew that we would need to find space eventually as he gets older, and Toronto is just not realistic for buying a house,” Bennett added.

A sweetheart rent deal had helped the couple save for a down payment, but not enough for a house in the Greater Toronto Area, where the average price of a detached home was $1,445,879 as of February, according to the Toronto Regional Real Estate Board.

So, last September, they purchased a detached home in St. Thomas, outside of London. With their three-year-old in tow, Bennett and Au set about starting a new life in the southwestern Ontario city.

The couple’s experience is becoming increasingly common, according to a new report from the Missing Middle Initiative, a think tank operating out of the University of Ottawa — and that poses a threat to the GTA’s economy, experts warn.

Over the past year, 80,000 more people have left the GTA for other parts of Canada than have entered the region from elsewhere in the country, according to the report. Young families are leading the exodus from the region as they seek more affordable family-sized housing in other markets, a trend that began in 2015 amid a population boom.

“The amount of young families who are leaving the GTA now on a fairly sustained basis should be concerning,” said Justin Sherwood, senior vice president of communications for the Building Industry and Land Development Association, which jointly commissioned the report alongside the Ontario Home Builders’ Association.

“We’re literally seeing a generation of young families starting to leave the GTA, and that will have profound implications.” These implications, he said, include a flight of skilled workers and individuals who are in their prime earning and tax-paying years. “In a lot of cases, these are solidly middle-class people who are leaving,” he continued. “You end up… creating a society with the haves — the wealthy — and the have-nots.”

While cities such as London, Kitchener-Waterloo, and Hamilton are popular destinations, young families are also turning to small towns, such as Tillsonburg. That’s where Brendan McElroy, 40, and his partner, Polina Frenkel, 36, moved six years ago, when they were already feeling the affordability crunch.

“We knew that we were going to have a family and in the area that we were in, living in an apartment in Toronto, it was just not feasible,” said McElroy. “We came across this little town of Tillsonburg, which had a property which we could start a family in,” said McElroy of the two-bedroom detached home he and his wife purchased for about $250,000. They’ve since added another bedroom to accommodate their two young children.

Based on forecasted population growth, the GTA needs to annually build 30,000 of what Mike Moffatt, founding director of the Missing Middle Initiative, calls “ground-oriented homes.” He defines these as “anything where you can get three-plus bedrooms and anything where you can look out the window and still be able to see your kids playing on the lawn.”

They include not just detached homes but also townhouses, stacked towns, and multiplexes. This target is in addition to 20,000 more apartments per year in denser buildings, and that’s “just to make sure the problem doesn’t get worse,” said Moffatt, the author of the report.

In recent years, the region has exceeded that apartment target, but homebuilders have only been breaking ground for about 10,000 to 15,000 ground-oriented homes, Moffatt pointed out. To achieve the target for ground-oriented homes, municipalities need to make a number of changes, beginning with loosening zoning rules to allow more gentle density, such as small apartments.

“It is probably number one,” said Moffatt. “Two would be development charges and other municipal fees, and I would include with that things like approval delays,” he added. On average, development charges on a new detached house in the GTA totalled $101,190 in 2023, according to a recent report from BILD.

Another major barrier is a lack of land available for the development of ground-oriented homes, said Kirstin Jensen, vice president of policy, advocacy, and relationships, at the OHBA. “There are a lot of municipalities that are constrained by their current boundaries,” she said. “You need land available — I think that’s the most basic way to put it.