It is often the case that politicians will clamor to take credit for new transportation improvements such as the opening of a new subway. Though certain figures and political parties will surely benefit from having better access to cheaper and easier transportation, no one could be happier than the residents of the area who would be reaping the benefits of such an event.
Real Estate Benefits
Easier travel and commute is just the tip of the ice berg as far as the benefits of a new transport system can bring. Almost all the real estate along the route or the track is sure to gain an increase in value!
It isn’t a secret that properties that have good access to roads and transportation generally are worth more than their less accessible counterparts. In fact, a US-based study showed that even in times of economic crisis, homes that are near public transit are able to maintain more of their value as compared to homes that are in non-transit areas.
The stability of property values is also affected by the types of transit available nearby. A phenomenon called the “transit premium “ is the term for this. This phenomenon is when property values tend to remain higher in areas with consistent public transportation access, such as what is true for properties near train stations and highways. The values usually drop the farther you are away from the train lines or highway. Too often, buyers were observed to follow a deal breaker rule, often considering more than 8 minutes walk to be a deal breaker when renting or purchasing a home.
The Course of Development
It can’t be denied that development follows subways. Although we don’t have the specific numbers for Toronto right now, the fact remains that the most desirable Toronto neighbourhoods are all well-served by transit access. We are well aware that this is just one of the many factors for an area’s desirability but we also can’t overlook the fact that for many homebuyers, especially first time homeowners, a short commute to work is near the top if not the top priority.
How Toronto’s Real Estate Market Is Shaped by Transit
Affordable areas have been known to skyrocket in value as demand surges when said area is made accessible. This is true for both residential and commercial spaces. Rents are known to be normally 40% more expensive in the 500 meters radius around subways or light rail tracks.
Due to this intensifying urbanization, an 83% population growth is predicted for Toronto by year 2031. It should be noted though that this intensifying urbanization isn’t just taking place in the middle of the downtown bur rather at ‘outer communities’. Such is the case for communities along Eglinton and Finch, where the demand has been steadily giving rise to further increase in property values.