Small cities and cottage towns across Canada are grappling with the fallout of surging popularity amid the COVID-19 pandemic, as urbanites flock in, driving up home prices with big-city-style bidding wars and putting pressure on municipal services.
The growing demand has led to some small Canadian communities seeing house prices jump more than 75% in one year.
“The small towns are getting hit hard. They’re getting interest like they’ve never had before,” said Stephan Gauthier, an Ottawa real estate agent who is increasingly helping clients buy in villages well outside the city. (Graphic: Annual price gains in select Canadian cities and towns,)
The eye-watering gains in Canada are mirroring similar trends in New Zealand, Australia and Britain, where rural home prices are accelerating faster than in cities as avid buyers rush to snatch up cheaper small-town properties and as white-collar workers bet on being able to work from home even after the pandemic ends.
The boom in Canada has builders flooding into smaller communities. More homes mean more demand for drinking water and wastewater treatment, forcing some towns to fast-track expensive infrastructure projects.
For locals, the influx of city people is a double-edged sword. New residents are breathing life and diversity into places where – before the pandemic – schools were closing and many businesses struggled through the winter.
But the soaring housing prices are locking locals out of the real estate market, and competition for rentals means many people can no longer afford to live locally, leaving small-business owners scrambling for staff.
Even existing homeowners, whose home values have risen sharply, are unable to move up the property ladder as the gap to the next rung widens past their means.
“You want people to come here and help build the community. But at what cost to the people who have been here for literally generations?” said Nancy Cherwinka, who lives in Prince Edward County, a peninsula in Lake Ontario known for its wineries and beaches.
MOVE TO THE COUNTRY
Roughly 75,000 people left Toronto and Montreal – Canada‘s two biggest cities and main COVID-19 hot spots – for other parts of their respective provinces of Ontario and Quebec in the year up to July 2020, the largest such migration since at least 2001, according to the latest Statistics Canada data.
For Prince Edward County, about 200 km (125 miles) east of Toronto, that migration has helped drive house prices up 78.5% on the year, putting ownership out of reach for many local residents. The average selling price of a home there in April was C$740,112 ($610,000).
“Now the rental market has gone nuts,” said Chuck Dowdall, executive director of the Prince Edward County Affordable Housing Corporation, with potential home buyers giving up on buying, and renting instead.
The rental crunch is making it difficult for small businesses to hire and retain staff, even if they pay above minimum wage.
It is a struggle that Samantha Parsons and her husband, owners of Parsons Brewing Company, know well. They built a small bunkhouse next to their brewery to house workers temporarily and have even had staff stay with them. This year, they arranged a lease for a three-bedroom home for employees.
“You have to be creative,” said Parsons, adding they still lose out on talent because of the housing challenge.
IF YOU BUILD IT
To tackle the housing crisis, Prince Edward County is planning for more than 3,000 housing starts through 2026, including dozens of below-market rental units.
That boom is putting pressure on municipal services, notably aging water infrastructure. The region is hastening plans to spend C$68 million ($56.2 million) on its water and wastewater system, with developers on the hook for much of the bill.
New-home construction is also surging in other smaller centers across Canada, with rural starts in the first quarter of 2021 at their highest point since 2008. (Graphic: Canada rural housing starts, )
In Collingwood, Ontario, a four-season resort town about 145 km (90 miles) northwest of Toronto, the population boom has forced the community to pause all new-home construction while it sorts out how to address its critical water shortage.
In Nelson, a former mining town in British Columbia’s Kootenay mountains, a pandemic-driven explosion of infill and coach housing is forcing the small city to expand its wastewater and water infrastructure sooner than planned.
“We were heading down that road anyway … but now it’s been accelerated. So that’s going to put us a little bit on our back foot,” said Mayor John Dooley, adding that the sewage treatment plant alone will cost about C$25 million.
Dooley said Nelson hoped to split the costs with the province and federal government.
Back in Prince Edward County, about half the children at a rural daycare are new to the community since the pandemic. At the sister daycare in town, a quarter of students are newcomers. Enrollment at local schools is also up, reversing a trend that had led to closures in previous years.
More young families living in the community will ultimately be beneficial, said Cherwinka, as long as they stick around once life goes back to normal.
“Hopefully they stay, hopefully it’s not just a pandemic solution,” she said. “Hopefully it’s long term.”
($1 = 1.2092 Canadian dollars)
(Reporting by Julie Gordon in Ottawa; Additional reporting by Andy Bruce in London; Editing by Peter Cooney)
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
MONTREAL – The Quebec Professional Association of Real Estate Brokers says Montreal-area home sales rose 9.3 per cent in August compared with the same month last year, with levels slightly higher than the historical average for this time of year.
The association says home sales in the region totalled 2,991 for the month, up from 2,737 in August 2023.
The median price for all housing types was up year-over-year, led by a six per cent increase for the price of a plex at $763,000 last month.
The median price for a single-family home rose 5.2 per cent to $590,000 and the median price for a condominium rose 4.4 per cent to $407,100.
QPAREB market analysis director Charles Brant says the strength of the Montreal resale market contrasts with declines in many other Canadian cities struggling with higher levels of household debt, lower savings and diminishing purchasing power.
Active listings for August jumped 18 per cent compared with a year earlier to 17,200, while new listings rose 1.7 per cent to 4,840.
This report by The Canadian Press was first published Sept. 6, 2024.
In the quest to find cities where renters can enjoy the best of all worlds, a recent study analyzed 24 metrics across three key categories—Housing & Economy, Quality of Life, and Community. The study ranked the 100 largest cities in Canada to determine which ones offer the most to their renters.
Here are the top 10 cities that emerged as the best for renters in 2024:
St. John’s, NL
St. John’s, Newfoundland and Labrador, stand out as the top city for renters in Canada for 2024. Known for its vibrant cultural scene, stunning natural beauty, and welcoming community, St. John’s offers an exceptional quality of life. The city boasts affordable housing, a robust economy, and low unemployment rates, making it an attractive option for those seeking a balanced and enriching living experience. Its rich history, picturesque harbour, and dynamic arts scene further enhance its appeal, ensuring that renters can enjoy both comfort and excitement in this charming coastal city.
Sherbrooke, QC
Sherbrooke, Quebec, emerges as a leading city for renters in Canada for 2024, offering a blend of affordability and quality of life. Nestled in the heart of the Eastern Townships, Sherbrooke is known for its picturesque landscapes, vibrant cultural scene, and strong community spirit. The city provides affordable rental options, low living costs, and a thriving local economy, making it an ideal destination for those seeking both comfort and economic stability. With its rich history, numerous parks, and dynamic arts and education sectors, Sherbrooke presents an inviting environment for renters looking for a well-rounded lifestyle.
Québec City, QC
Québec City, the capital of Quebec, stands out as a premier destination for renters in Canada for 2024. Known for its rich history, stunning architecture, and vibrant cultural heritage, this city offers an exceptional quality of life. Renters benefit from affordable housing, excellent public services, and a robust economy. The city’s charming streets, historic sites, and diverse culinary scene provide a unique living experience. With top-notch education institutions, numerous parks, and a strong sense of community, Québec City is an ideal choice for those seeking a dynamic and fulfilling lifestyle.
Trois-Rivières, QC
Trois-Rivières, nestled between Montreal and Quebec City, emerges as a top choice for renters in Canada. This historic city, known for its picturesque riverside views and rich cultural scene, offers an appealing blend of affordability and quality of life. Renters in Trois-Rivières enjoy reasonable housing costs, a low unemployment rate, and a vibrant community atmosphere. The city’s well-preserved historic sites, bustling arts community, and excellent educational institutions make it an attractive destination for those seeking a balanced and enriching lifestyle.
Saguenay, QC
Saguenay, located in the stunning Saguenay–Lac-Saint-Jean region of Quebec, is a prime destination for renters seeking affordable living amidst breathtaking natural beauty. Known for its picturesque fjords and vibrant cultural scene, Saguenay offers residents a high quality of life with lower housing costs compared to major urban centers. The city boasts a strong sense of community, excellent recreational opportunities, and a growing economy. For those looking to combine affordability with a rich cultural and natural environment, Saguenay stands out as an ideal choice.
Granby, QC
Granby, nestled in the heart of Quebec’s Eastern Townships, offers renters a delightful blend of small-town charm and ample opportunities. Known for its beautiful parks, vibrant cultural scene, and family-friendly environment, Granby provides an exceptional quality of life. The city’s affordable housing market and strong sense of community make it an attractive option for those seeking a peaceful yet dynamic place to live. With its renowned zoo, bustling downtown, and numerous outdoor activities, Granby is a hidden gem that caters to a diverse range of lifestyles.
Fredericton, NB
Fredericton, the capital city of New Brunswick, offers renters a harmonious blend of historical charm and modern amenities. Known for its vibrant arts scene, beautiful riverfront, and welcoming community, Fredericton provides an excellent quality of life. The city boasts affordable housing options, scenic parks, and a strong educational presence with institutions like the University of New Brunswick. Its rich cultural heritage, coupled with a thriving local economy, makes Fredericton an attractive destination for those seeking a balanced and fulfilling lifestyle.
Saint John, NB
Saint John, New Brunswick’s largest city, is a coastal gem known for its stunning waterfront and rich heritage. Nestled on the Bay of Fundy, it offers renters an affordable cost of living with a unique blend of historic architecture and modern conveniences. The city’s vibrant uptown area is bustling with shops, restaurants, and cultural attractions, while its scenic parks and outdoor spaces provide ample opportunities for recreation. Saint John’s strong sense of community and economic growth make it an inviting place for those looking to enjoy both urban and natural beauty.
Saint-Hyacinthe, QC
Saint-Hyacinthe, located in the Montérégie region of Quebec, is a vibrant city known for its strong agricultural roots and innovative spirit. Often referred to as the “Agricultural Technopolis,” it is home to numerous research centers and educational institutions. Renters in Saint-Hyacinthe benefit from a high quality of life with access to excellent local amenities, including parks, cultural events, and a thriving local food scene. The city’s affordable housing and close-knit community atmosphere make it an attractive option for those seeking a balanced and enriching lifestyle.
Lévis, QC
Lévis, located on the southern shore of the St. Lawrence River across from Quebec City, offers a unique blend of historical charm and modern conveniences. Known for its picturesque views and well-preserved heritage sites, Lévis is a city where history meets contemporary living. Residents enjoy a high quality of life with excellent public services, green spaces, and cultural activities. The city’s affordable housing options and strong sense of community make it a desirable place for renters looking for both tranquility and easy access to urban amenities.
This category looked at factors such as average rent, housing costs, rental availability, and unemployment rates. Québec stood out with 10 cities ranking at the top, demonstrating strong economic stability and affordable housing options, which are critical for renters looking for cost-effective living conditions.
Québec again led the pack in this category, with five cities in the top 10. Ontario followed closely with three cities. British Columbia excelled in walkability, with four cities achieving the highest walk scores, while Caledon topped the list for its extensive green spaces. These factors contribute significantly to the overall quality of life, making these cities attractive for renters.
Victoria, BC, emerged as the leader in this category due to its rich array of restaurants, museums, and educational institutions, offering a vibrant community life. St. John’s, NL, and Vancouver, BC, also ranked highly. Québec City, QC, and Lévis, QC, scored the highest in life satisfaction, reflecting a strong sense of community and well-being. Additionally, Saskatoon, SK, and Oshawa, ON, were noted for having residents with lower stress levels.
For a comprehensive view of the rankings and detailed interactive visuals, you can visit the full study by Point2Homes.
While no city can provide a perfect living experience for every renter, the cities highlighted in this study come remarkably close by excelling in key areas such as housing affordability, quality of life, and community engagement. These findings offer valuable insights for renters seeking the best places to live in Canada in 2024.
