Rich Torontonians Eyeing An Exodus From City After Pandemic: Agency
As the coronavirus pandemic spread across the world earlier this year, news reports emerged that many rich people were fleeing dense cities for the perceived safety of suburbia or the countryside. Now, some observers say that trend could become permanent.
In Toronto, the centre of Canada’s second-worst COVID-19 outbreak, the wealthy are turning their attention to the Muskoka region, the cottage country north of the city, said Max Hahne, a Collingwood, Ont.-based real estate agent at high-end agency Engel & Volkers.
And it’s not out of some sudden interest in weekend getaways ― these people are looking to resettle permanently, Hahne says.
Watch: Pandemic prompts tech workers to flee Silicon Valley for mellower pastures. Story continues below.
The pandemic has been “a wake-up call for homeowners, not just like, ‘where do I want to live,’ but ‘how do I want to live?’” Hahne said in an interview with HuffPost Canada earlier this month.
He said interest has “spiked” since April, with much of it concentrated in high-end housing ― properties above $1.5 million.
“I’m locked down here on my farm, getting calls and emails from people sitting outside a property,” he said, a phenomenon he attributed to “lockdown fatigue.”
It’s hard to tell at this point whether the trend Hahne sees anecdotally is playing itself out. But the latest sales numbers from the Lakelands Association of Realtors, which covers a large part of cottage country, show the real estate market in the region is more active than the one in Toronto.
While Greater Toronto home sales fell 67 per cent in April, the first full month of the lockdown, they fell a relatively mild 46 per cent in cottage country. And prices seem to be holding up better as well.
The market “is dropping off the cliff fast, but when it starts to recover, I think we’re going to see a spike in (the third and fourth quarter) and maybe sooner, because I’m noticing this lockdown fatigue.”
Hahne sees moving out of the city as a broader trend he thinks we will likely see in the coming years, helped along by the fact many companies are now switching to working from home, either partially or fully, on a permanent basis.
“Now I think you’re going to find more people moving to Collingwood (a cottage-country town) because their companies will allow it, and they have the tools, and they are comfortable using the tools.”
In the U.S., the trend is evident not only among the wealthy ― the New York Times, for instance, reported that as many as 40 per cent of the people in Manhattan’s wealthiest areas appear to have fled the city during the pandemic ― but also among youth.
Young people, who led the rejuvenation of urban neighbourhoods over the past few decades, are looking to move out to the more spacious suburbs, Bloomberg News reported recently. In many instances, that means moving back in with their parents.
The impact will likely mean lower rents, particularly in more overpriced cities with previously heavy demand on urban housing, such as New York and San Francisco, Bloomberg cited housing experts as saying.
It’s a trend many predicted even before the pandemic. Futurist Nik Badminton told HuffPost Canada earlier this year that he sees cottage-country communities near Canada’s largest cities as potential “boom towns” in the years to come.
That’s thanks to a class of “semi-retired entrepreneurs” who have been active in business their whole lives but are looking to slow things down, and improve their quality of life as they age, Badminton said before the pandemic.
Communities of “relocated wealthy middle-aged ‘retirees’” will become “new centres of business and will become more established,” he predicted.
But not everyone in the real estate industry north of Toronto sees a permanent exodus of city dwellers in the wake of the COVID-19 pandemic ― at least not anymore than there was before the crisis.
This spike in interest from Toronto homebuyers may be nothing more than people stuck with nothing to do in the lockdown, amusing themselves with idle house-hunting, said Joe Quinn, a sales rep in the Muskoka/Port Carling office of Chestnut Park Realty.
The trend of Torontonians moving out to the nearby countryside began well before COVID-19, Quinn said.
“For two or three years, we’ve seen people want to ― I would say downsize, get out of such a busy market and take advantage of the high housing prices (in the city). … The differential between Toronto and Muskoka (can) save you a lot of money.”
He says he has seen people heading into their retirement years who were able to sell their homes in Toronto and buy a new one in the country, leaving them with hundreds of thousands of dollars to fund their retirement.
And he doesn’t particularly object to the potential influx of urbanites into his community.
If more people live in cottage country year round, “we’re going to have more stuff open year round, more good restaurants, more good produce in our stores. If we have more people I see it as a positive.”
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