Thousands of young people are fleeing Toronto – economists say city will suffer
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I was making a pretty normal tech worker salary, and struggling on 2500/m. (90k CAD in early 2020) Looking around there were only similar or more expensive options. Many of them were "ready to move in". (Aka, vacant) The pandemic barely put a dent in those prices.
I moved to Montréal, currently have a 2bdrm so I can have a home office, on the ground floor of a triplex with a little sunken balcony, in the gay village, for 1500/m.
I don't even know why I'd live in Toronto, it's just become a bad deal now. Doesn't matter who you are. If you think of rent and cost of living as the "subscription" to a city, there's no way you're getting that sort of value out of it.
For a lot of Canadians/Torontonians (everyone I know), family and friend bonds keep them there.
Canada is not an easy country to hop around. The next metropolitan city over is an expensive flight, and heaven forbid one of those sides includes Pearson Airport.. Canadians are culturally less flighty than Americans in my experience. And the options to move to are quite limited (again, in comparison to the USA)
Source: I've lived 2/3 my life in Canada, 1/3 in the US.
A big issue is that Montreal's salaries are, as other commenter have said, upwards of 30% lower here. With rising rent and real estate costs, people are living outside their means. More than that, though, companies outside of Montreal are loathe to hire Montrealers remotely as well. It's not just because of the decline of remote friendly workplaces, but also the language laws in Quebec. Any legal department worth their weight will look at Quebec's requirements for companies to serve Quebec employees in French, and promptly conclude hiring there isn't worth it.
It really seems like no matter where you end up in Canada the cards are stacked against you. Vancouver is just as expensive as Toronto, and Montreal has all the aforementioned issues. At this point I'm considering running off to Europe, but I know that has its own host of issues as well. I might just be falling victim to analysis paralysis, but I definitely feel stuck.
I’ve thought about Europe as well, I’ll need to reevaluate in a few years to see if that’s still a positive move for me. The French expats I work with they have their own complaints and reasons for crossing the Atlantic.
You obviously have to pay back the remaining debt, but this makes it super smooth to either pay off all debt in one go or refinance.
Anything after the 10-year-period comes without any kind of penalty.
Getting out of the contract earlier is possible, but comes with a penalty called Vorfälligkeitsentschädigung — it boils down to the bank demanding the interest payments you would have paid if you‘d stayed in the contract for the whole 10 years.
However, afaik, if you also had an agreement on „Sondertilgungen“, that is, if the contract allows to pay x% of additional down payment every year, the bank must assume you had paid this for the remaining years in the contract.
No financial advice.
You're essentially paying to originate a new mortgage (with the same originator as your previous or anyone else).
Proceeds pay off previous mortgage, and no one can really tell you no.
I'm not sure if any US mortgage can have prepayment penalties and be compliant? (for resale of the mortgage debt)
Worst I've seen is "If you pay fully before X date, we'll charge you the closing fees we comp'd you originally."
If not, I assume someone would have written a 3/1 ARM with predatory early repayment provisions, so I'm guessing there's probably a conformant mortgage guideline (e.g. from *Mac) that prevents clauses like that.
The concept is that you are taking out a loan to pay off an earlier loan.
If you borrowed at 8% and rates dropped to 2%, you could refinance even if your house price dropped, and it would still make sense, as you borrowed what you borrowed, and still owe it.
Now, if you are trying to refinance and take some money out from equity, sure, that relies on having greater equity than the loan value.
This is of course stupid on the part of everyone involved but especially the person who currently owns your loan. Lowering the interest rate for a person with an underwater mortgage can only increase the security of it as a financial asset. If they default it's pure loss. But a new bank doesn't want to take on an underwater mortgage and even at the institution that owns your loan the left hand originating mortgages doesn't know what the right hand is doing servicing them.
The bank can sieze the property and sell it, but by definition they will lose money.
so whoever lent you at 8% would take a loss if you could just abandon that rate and went with someone else's 2% rate. Therefore, it can't be this simple - somebody must be eating a loss. I suspect that 'somebody' is Freddie Mac and Fannie Mae , which is a quasi-gov't corporation and therefore, they might be able to take the loss without worrying about profitability.
Why would they? If I lend you $100 at 8% interest and for simplicity let's say it's an interest only loan so you only pay the interest I get $8/yr for my trouble. Then you refinance with someone else at 2% and I get my $100 back. All good, now it's available to me to loan back out. The only thing I've "lost" is future profits but you also could have just paid off the loan entirely in cash to the same effect.
but this is a real loss, since the original loan contract was for 8% p/a for X years.
In a different country like australia, a fixed term loan cannot be paid off without the expected interest. This is why i am confused as to what makes refinancing work - who eats the loss?
Also allows the public to capture the financial upside of public infrastructure projects (e.g. building a billion dollar subway today produces a huge amount of wealth for the landowners who happen to be near that project, in the form of increased rent — that can and should be captured by the public who paid for it).
And there’s infrastructure. Places that weren’t designed for the density don’t have the water/sewer, electrical, etc capacity. Traffic too - now there’s more traffic making a place not as nice. So that needs to be sorted out too.
Same reason our telecom prices are higher than almost anywhere in the world. Canada isn't as great a county as a lot of people think.
Idk seems like a scary scenario.
Anyway, no population in this world have ever changed any of their traits because some random douche said they should, quite the contrary.
As a person living in the border of middle east, Toronto is a place that people would like to migrate.
“ You would need around 8,129.0C$ in Toronto to maintain the same standard of life that you can have with 6,400.0C$ in Montreal “
And I really do feel that as a recent graduate I pay for a 1 bedroom apt what some friends in Toronto pay to share a 5 bedroom house it’s a big investment for a young person just to live there
Toronto isn't that great.
What exactly is it that Toronto has you can't get anywhere else?
The Blue Jays? The Raptors?
That's pretty much it I'm sure.
If you're gonna tell me some nonsense about the culture of the city being so unique, save it. Every city has nightclubs and concerts and art shows and theater plays and other artsy stuff.
Every city has a food scene nowadays too, and fancy cafes and whatever else.
Toronto isn't that special.
Food scene is great, hockey scene is amazing even if we do have the Leafs.
As much of a joke as the saying is, it really is the centre of the universe in Canada and benefits from the perception of such.
You have to be super bitter to say Toronto isn't actually that special in Canada, go watch Everyone hates Toronto or something.
Even Victoria, which is tiny compared to Toronto, has all of that.
And amazing cultural festivals too.
Please leave your bubble once in a while.
So all those cities have the same things but in much smaller quantities and generally missing out on larger events which Toronto is never skipped for.
I don't live in Toronto and haven't for more than short stints in nearly 25 years. Toronto is a great city. Vancouver is a beautiful boring sprawl and it's got some great things within a short drive. Montreal has a good cultural scene but fails on the job market. All the rest of the cities are too small to compare.
Other parts of Canada aren't terrible and definitly make more sense than Toronto for a lot of people. But Toronto has a combination of things that no other city in Canada compares to and to deny that is to be delusional.
- You do not know the places for cheap prices
- Being a target for tourist scams
many other hidden costs I forgot to say
If I ever want to go do stuff, its only 30-40 minutes away too.
WFH has been liberating for so many people.
Living 30 or 40m away from the city was great in theory, but sucked given that we did that trip every weekend (or sometimes during the weekdays). Also, the suburb we lived in was not walkable at all. The sprawl was insane and sidewalks were a rarity.
I guess people who prefer city life are those who like the faster pace, dynamics of more and more variety of people, art, food, services, parks, festivals, etc. etc. Not that one preference is better than the other.
> If I ever want to go do stuff, its only 30-40 minutes away too.
Lol. Spoken like a suburbanite! :D Depending on where exactly you live, everything in Manhattan would be within 30-40 minutes.
> WFH has been liberating for so many people.
Also, many cities see an increase in residents (but a decrease in office workers). People like to work from homes in the city.
But I don't mean to be disagreeing. Glad you found what you liked, and many have followed your path.
Mainly, how the actions of others (good or bad) don't have as much of an effect on me. Believe it or not, one of the main things was people smoking weed. People would smoke it endlessly. I attempted pretty much every solution before moving. It smelled awful and got into my sinuses and would make me get an instant sore throat. Similar to cigarette smoke. I guess I'm allergic but basically if it got in my respiratory system, my sinuses would be effected and make it next to impossible to breath through my nose. This often would then lead to sinus infections and always a sore throat every night. I literally felt like I had a cold every other day.
I moved apartments but the same damn thing happened. Now, that could be bad luck or it could just be a new normal, I don't care to find out though.
Also now, with an actual area to do "DIY" stuff, I can run power tools and play guitar with amp without annoying anyone, lol.
>Lol. Spoken like a suburbanite! :D Depending on where exactly you live, everything in Manhattan would be within 30-40 minutes.
My bad, by "stuff" I meant city stuff like shows, entertainment, fancy restaurant, etc. For day to day, I'm only a 5-10 minute drive. I've actually been saving a ton of time in tons of ways you don't really consider. 1-2 hours of groceries a week is better (at least according to my wife) than 20-30 minutes every few days.
>Also, many cities see an increase in residents (but a decrease in office workers). People like to work from homes in the city.
That's good. Seems we all are getting what we want, thanks to WFH.
It's interesting to see some people seek to be further from others. I imagine it like particles in a given volume: fewer particles collide less, while I happen to love the energy of more (though not things like second hand smoke in my home). To me, it's like going to a concert - I want it to be wall-to-wall, not mostly empty. (Again YMMV.)
Oh yea, 100%. The second place I got the problem was not nearly as bad but still made me feel sick about once a month during a "party" or something.
I had the pleasure of living next to 3-4 college kids. I guess they split the rent. I also moved to Texas where its generally not as legal so I believe they tend to use devices that limits the smell/spread. So it wasn't nearly as bad but sometimes you just wanted peace from that, ya know.
And yep, to the particle analogy. I had plenty of good interactions with people. Sadly, the negative ones just sucked too much.
Before moving to the city, I expected the traffic and crowds would be the primary drawback compared to suburbia. But I’ve found that the smells and sounds of my own neighbors’ activities to be the worst, like running their loud AC 24/7 even in winter, and spraying copious Lysol and febreeze multiple times a day.
Love living in this city with all of the activities nearby, but I’m 100% ready to gtfo and don’t think I’ll miss it.
Also, I get that you're going to smell food/odd stuff from neighbors from time to time but there's only so much you can handle.
For retirees, especially when driving is a problem, all the service, transportation, etc. can be great. Also, you have time again for all the fun and want activity, unlike people raising a family who barely have time to sleep.
It's a bit annoying living outside the core when you are young since cabs are expensive and regional pubic transit unavailable late but outside of that everything else is pretty close to just as accessible you just have to plan more in advance where when i lived downtown I could just be bored one afternoon and go find a cool event
Use a bike? If you don't want to cycle all the way to the city park it at the last all-night public transport stop and take the bus/tram/train/whathaveyounot to the city from there?
Maybe it is my Dutch heritage or maybe just common sense but anything up to ~15km is within an easy bike ride range, 20km if needed. OK, you can't get drunk like a skunk but why would you do that anyway? A few beers are fine, you'll cycle them off anyway.
In my eyes cities look at their best when you see them disappearing on the horizon after a pleasant night out.
I've never been to Toronto so maybe this prospect is totally unthinkable there but I've spent a few weeks around Vancouver - it was meant to be only a few days since I was scheduled to fly out on the 11th of September, 2001 - where cycling was just as feasible as in most European cities.
As mentioned regional transport is spotty at night and even then you are probably looking at a 15-30km trip from the nearest stop on 80km roads with small shoulders. It's also completely out of the question for the 6-7 months a year snow is on the ground.
Yea, I'd say this is probably the worst part about living outside of a city. Just not as many events to go to easily. At the end of the day though, the 30-40 minute drive isn't too bad when its something you really want to go to and plan for.
Also lots to do outside the city of you like nature.
> “Parks” for instance…from my experience, a city would not be where I’d first look for this.
Cities often have all sorts of interesting and varied parks, often beautifully designed, with public art, museums, etc. Look at Central Park, Golden Gate Park, the parks along the lake in Chicago, etc. Look up all the parks in Manhattan alone. LA has wild valleys near the Hollywood Hills. And if you look around, you can find lots of wonderful, unknown, small parks. The economy of scale - resources to design, build, etc. - can lead to some wonderful spaces.
Obviously, out where there's more space, there are larger undeveloped areas; those differ from urban parks.
30-40 mins away from downtown isn't better to me (in fact, so much worse. But to each their own..). Maybe Uxbridge or something?
I think young people will start building communities away from the big cities. And their lives will be so much better
Some good search terms for this topic are "the yellowbelt"[1] and "the missing middle"[2].
[1]: http://www.mapto.ca/maps/2017/3/4/the-yellow-belt
[2]: https://99percentinvisible.org/episode/the-missing-middle/
Original title, which does not imply that young people are fleeing from economists: "Thousands of young people are fleeing Toronto — economists say the city will suffer because of it"
Submitted title was "Thousands of young people are fleeing Toronto, economists: city will suffer"
I left Toronto for an even more expensive area(Bondi) and i see this here too with backpackers willing to live 6 people to a 3 bed apartment while locals feel priced out at the 1 bed or studio level.
(Which is not a criticism - I'd rather admit the poorer immigrants, who need the change of scenery more.)
Do you have numbers that presumption is based on?
Sorry on mobile best source right now is Wikipedia https://en.m.wikipedia.org/wiki/Demographics_of_Toronto
Toronto isn't a small city.