There is a lot of talk about what is happening with housing prices and affordability lately. Are prices going to crash or continue? What can be done about affordability? I have some thoughts on these topics at the links above. While following the major trends is an important aspect of real estate investing, there is no such thing as the "Canadian Real Estate Market." Markets are much more local, and react differently to the same market pressures. Let's dive into my favorite market and some of the trends we are seeing in the Niagara Region.
In 2016, the Niagara Region commissioned a study on population growth and the impact it would have on transportation needs for the region. Here are some excerpts from the study.
Transportation. "The Niagara Region will need to strengthen connectivity among its municipalities and to the GTHA, and to improve options for non car travel."
Since they have identified transportation as an issue holding the Niagara region back, the Region and Metrolinx have worked hard to find a solution to this. There is now daily GO Train service from Toronto to Niagara Falls, as well as GO bus service and Niagara Region bus service. Here is the map of proposed and active transit.
Population and employment. “Over the next 25 years, Niagara Region will grow twice as fast as it did over the last 25 years. The population of 442,800 in 2011 will increase by 38% to reach 610,000 in 2041.”
With an estimated increase of 168,000 people and 80,000 jobs by 2041, the demand on housing is expected to increase dramatically resulting in housing shortages. That’s like adding the Greater Sudbury area to the Niagara Region over the next 20 years!
Job Growth. “The number of jobs in Niagara Region will also grow rapidly. By 2041, employment is expected to rise by 43% (from 185,000 to 264,000 jobs), a rate that is nearly double Niagara’s average increase of 0.8% per year over the past 25 years.”
Demographics. “Seniors will be the fastest-growth segment of population. The number of young adults, which dropped over the last 25 years, will instead increase over the next quarter-century. Young adults are key to the transition from an industrial to knowledge-based economy, and expect to have a range of travel choices.
With the average home price in the Niagara Region according to CMHC at a price of $838,217 in September 2021 compared with $353,000 in September 2011, we are seeing massive home price growth over the last 10 years. Yet, the Niagara Region is projecting our population and jobs to increase at nearly double the rate that they have in the past. To top it all off, the region has been aware of a housing supply problem for a lot of years, but it still appears that demand is outpacing supply. If you look at the housing formations compared to the new housing completions in Ontario over the last 10 years, you will find that demand is outstripping supply by almost 20%. Looking forward, the Ontario government is projecting that housing formations will balloon to 900,000 over the next 10 years, compared to 700,000 over the last 10 years. This looks like massive growth to me. Of course, there are more factors at play here such as interest rates, bank lending guidelines and overall economy. Some of these factors are broken down here.
What does all this mean for me? How can I capitalize on these trends? It would appear that rental demand and housing prices are on the rise in the Niagara region. Whether you are a new investor trying to break into the housing market or an experienced investor from out of town, we can help you identify the trends and good neighborhoods within the region to invest in and we can help you find a good cash flowing opportunity that will serve you for years to come. We offer consultation services, joint venture opportunities and hands off investing in the Niagara area.
Have questions about your portfolio or want an outside opinion? Please select the button provided below, and I will schedule a free half-hour call with you to go over your situation! Talking to the right people can really save you money. I really believe that this is the time to expand your network and learn from those around you. I'll be in touch!
I'd love to hear your thoughts on this! Have a great week while working past those obstacles on your climb to success. Let's Grow Together!
Jonathan Beam
Real Estate Investor and Entrepreneur
Jonathan Beam is a real estate investor in the Niagara region who is passionate about helping you achieve financial freedom through real estate. He works with new and experienced investors to formulate a plan that fits your specific situation and provides market guidance and consultation on the best places and strategies to pursue within the Niagara Region. Book a free, half hour no obligation consultation to see how he can help you to achieve your goals. His travels are available at www.realestateandrepeat.com
For a free market analysis on 2 markets within the Niagara region that we are currently investing in, please visit the home page and fill in the contact form at the bottom for your free report!
Sources:
Niagara Region – How We Grow https://www.niagararegion.ca/2041/pdf/mcr-pic3-boards.pdf
Niagara Region – How We Go https://www.niagararegion.ca/2041/pdf/tmp-needs-report.pdf
Niagara Region – Transportation Master Plan https://www.niagararegion.ca/2041/pdf/tmp-master-plan-study-report.pdf