Canada's Condominium Magazine
[highlight]Changing attitudes, rising costs are making car ownership, including parking, an unwanted expense for many[/highlight]
Canada is one of several countries where the number of younger people who hold drivers’ licences has fallen over the past twenty-five years. The drop in younger drivers has been matched by an increase in older drivers. Because of this shift, the largest group of drivers in these countries (Finland, Great Britain, Germany, the United States are a few of the others) is now the middle aged. The drop between 1978 and 2008 in the US was dramatic: the percentage of 17-year-old drivers fell from 75 per cent to 49 per cent over that time period.
Various theories for this social shift have been put out. One is that the pervasiveness of digital media and the correspondent rise in laws forbidding their use by drivers, is turning younger people away from driving and into public transit. Another is that the high costs of maintaining a car, especially in the city, prevent many lower-paid young people from owning a car.
Environmental, health and quality of life concerns also play into the discussion. Some people, not all of them young, prefer to live where they don’t need a car every day. For these urbanites, it is not just acceptable but preferable to walk or cycle to work and to do the shopping, and to take a subway or bus if they have to go farther afield. A car is a once-in-a-while necessity, not a daily one. And there’s evidence that their numbers are growing.
The remarkable rise of car sharing
Take car sharing, for instance. A decade and a half ago there was no such thing in Toronto. Today there are three car-share companies: AutoShare, car2go and Zipcar. The combined fleets of the three now comprise about 1,000 cars serving roughly 40,000 people. According to the owner of AutoShare, Kevin McLaughlin, there were just 2,500 users seven years ago. That is a fifteen-fold increase, and that is pretty spectacular growth by any standard.
The growth has not gone unnoticed. Now, McLaughlin said in the Globe and Mail last month, a number of the big auto companies, Ford, GM and Volkswagen among them, are looking at getting into the act with their own car-sharing programs. And the big car rental company Avis has recently acquired Zipcar, indicating that Avis takes the car-share threat to their own business seriously. McLaughlin sees a lot of other choices coming our way too—shared taxis, peer-to-peer services, co-op mini-buses (jitneys) and so on. So the era of sharing, at least in Toronto, seems to be here.
The condo factor
The major demographic change in Toronto in the past couple of decades, paralleling the time that younger drivers have declined, is of course the condo boom. And while it used to be a given that a condo building would provide close to one parking spot for every unit, a ratio of 1:1, that is no longer true. And the dwindling number of parking spaces—some buildings have none at all—is inflating their worth, as always happens. A parking spot that cost the purchaser of a condo $15,000 five years ago could be worth three times that amount today. And we have all heard of new buildings in highly desirable areas offering parking spots for $50,000–$60,000, which by the standards of some world cities is a steal.
The fact that buying a parking spot in a condo can add up to $50,000 or $60,000 to the price of the condo undoubtedly deters some from going that route. That parking space is going to add a couple of hundred dollars to the mortgage payment every month, so the owner is paying far more than the “ticket” price for it. And the upfront cost of a parking space isn’t necessarily the end of the story. Many condo developers now charge an additional monthly maintenance fee of $50–$60 for a parking spot, on top of whatever it cost to buy the spot. A person must really need a car to pay that kind of money just to park it.
A lot of condo purchasers choose to buy a parking space with the intention of renting it out for a nice monthly fee, though this, it turns out, is technically illegal in Toronto. There’s also a brisk resale market for parking. It’s possible to flip a spot for a nice profit, though anyone contemplating doing so had better check the condo declaration very carefully before any money changes hands. It could be against the rules to sell to a non-resident of the building.
Just as it doesn’t always make sense for a condo buyer to pay big bucks for a parking spot, it can be uneconomical for developers to provide those spots in the first place. In a large development like Tridel’s Ten York, built on a very confined parcel of land, the cost of providing 450 parking spots underground, to comply with the city’s requirement for .75 parking spots per unit, would be prohibitive. Underground construction is vastly more expensive than above-ground. The alternative, to put the parking above ground, is not an option. And there is the troubling reality that many parking spaces in condo developments go unsold and sit empty.
To compensate for a lack of parking, developers today, especially downtown, will focus on the accessibility of transit, the walkability of the neighbourhood, the availability of car-share services on the premises, to offset the lack of parking. Some condos, responding to market demand, have more spaces for bicycles than for cars. And it is common to find pre-construction condo promotions offering parking as part of the purchase price of a suite.
Presumably those who absolutely must have parking will find a way, likely by choosing a building that offers it at a price they can afford, or making some other arrangement outside the building. For those who don’t want to pay the price of parking, there is less and less reason to do so, especially if cycling, walking, transit and car sharing are options for daily needs.