Transport System in Toronto: Improvements on Their Way
// September 15th, 2009 // Real Estate
The transportation system is the backbone of every big city in the world and Toronto is no exception. Population explosion in the last four decades, multiplying almost five times since 1970, has been the most important reason why our transportation system is no longer capable to satisfy the demands. Yes, there have been some improvements in the past years, but mostly minor, offering only provisional solutions. At last, a project called The Big Move will completely change the face of the transportation of south Ontario in following years.
MoveOntario2020 is the name of the key branch of this overall transportation outlook. In June 2007, this plan has been announced (and just as well may have assisted to liberals’ reelection in October) and now is expected by broad public. There are 52 projects, scheduled till 2020, with the budget around $17.5 billion ($11.5 billion paid by Ontario). 1. GO Transit upgrades and extensions; 2. Major municipal transit expansions; 3. Cross-boundary subway expansions; and 4. Rapid-rail link between Toronto Union Station and Toronto
Real estate and transit system
The Toronto’s housing market is a very complex industry and can be affected by many different elements, either only a little, or the impact may be bigger. Even though we can’t always separate the effect of a particular change in the local or global economic environment, but some of them are more significant than others. One of the crucial elements is the transit system.
Most people can picture themselves how the quality of living is positively influenced by the transportation system. For example, it can reduce the direct costs of commuting, indirect costs of time consumption, easier access to public facilities or better environment with cleaner air, while the negative aspects are only minor and short-term.
There are a number of research papers attempting to quantify the effect of various improvements in transportation system. For example, in a paper from Tinbergen Institute, focusing only on railways, it is said that the home value may be positively affected by railway accessibility up to 25%. Just a simple doubling of public transport frequency increase means average 2.5% value increase for every home in the region – just one year after the works are completed.
What will change in Toronto real estate after MoveOntario?
We can base the expectations on recent study conducted by REIN Canada. One of the crucial methods of lowering the commuting time is a rail commuting system, which in Toronto is represented by underground and GO Train system.
The positively affected areas lie in about 800m range from every station, with value maximization in 500m range. Older neighbourhoods or areas with lower average income of citizens are typically influenced more. Specifically, Toronto quarters around Spadina and Younge subway lines extensions are great examples of the effect on property prices. For GO Train it’s more complex; there are 17 projects involving capacity expansion, new lines and/or lines expansion and there are 9 more projects involving GO Bus Rapid. New light train transit lines in the neighbourhoods of Waterfront and Eglinton will have a similar impact.
Conclusion
In this short article, we cannot analyze in detail the whole mechanism how MoveOntario 2020 will influence the Toronto housing market. The REIN study shows that the most positively influenced areas will be around Vaughan, Scarborough and Barrie. The second group of highly influenced areas consists of Milton, Brambton and Uxbridge&Stoufville regions. The house prices are expected to rise by 10-20% in these areas. Thirdly, actually all Toronto regions lying around the new lines, or old lines with plans for increasing their capacity, are going to profit as well. Positive impact on housing prices should be visible 1-3 years after the particular project is completed.
And that’s not all. The new transit system will improve life quality also near the old parts, because now more neighbourhoods will be easily accessible. Some 175 000 jobs are expected to be created thanks to MoveOntario, which may again positively impact the GTA real estate prices. More people, more investors and more business are going to be attracted with our well functioning transit system. The whole Toronto is going to profit and property values on the whole Toronto housing market may be positively affected for the next decades.
