Canada's Condominium Magazine

Studies: Millennials are choosing smaller urban condominiums over larger suburban homes; transit more important than size

Studies suggest 18-34 year olds prefer condo and apartment living for walkability, short commutes and access to amenities — and not because of affordability.

Many would choose an even smaller condo, with a higher price-per-square foot, just to have ready access to subway. [1] Access to transit was the number one factor, despite price. Lower maintenance fees — typically found in newer condos — is a close second as a choice factor.

 

Rated number one with Millennials in choice factors is close access to transit, preferably subway.

 

In the current market in Toronto and Vancouver, detached homes are out of consideration for many Millennials, but it isn’t price that is motivating them to stay urban. In choosing between a large condo in the suburbs, versus a micro condo by a subway station in Toronto, the majority of Millennials choose compact and handy. [3]

Tridel’s Bloorvista, near Bloor and Islington subway, would be an ideal target for Millennials. Although already sold out — a sign of it’s popularity — Phase 3 of the community, Bloor Promenade, is available.

Giving up the car and yard

Affordability isn’t the main reason younger buyers are looking to condominium apartments versus detached and town-home living.

In surprising results from several studies, younger condo buyer’s do not equate and car with freedom. Instead, they value, studies indicate, connectivity, transit, walkability, short commute times, access to amenities and entertainment. [1] In real terms, the number of kilometres driven each day by 18-34 year olds is declining and at historic lows. [2]

 

Bloor Promenade coming from Tridel is close to the Bloor and Islington subway.

 

Millennials prefer ready-to-move

Younger buyers aren’t looking for fixer-uppers and tend to buy ready-to-move condos, either new or recently renovated. In the CMHC First Time Home Buyers Survey, internet research and social media were the main methods of “search” for a new home. 83 percent used web research for mortgage research.

 

Millennials prefer “ready to move-in” and value internet connectivity.

 

Neighbourhood affordability

Given Millennials are most likely to stay urban for many reasons, the question then becomes where. Because low maintenance costs are a key choice factor, new condos tend to be the first choice. In studies, they rated access to transit (especially subway) as the number one factor. However, the price per square foot significantly varies by neighbourhoods and along subway stops.

 

Access to safe bicycle paths is a plus. Walking, cycling and transit are preferred method of transport.

 

Many younger buyers are willing to give up size for handy access — ultimately walking distance to a subway stop. That doesn’t necessarily mean Rosedale or Bay Street stops, where the prices are $961 per square foot and $958 per square foot on average, respectively (as of May 2017). [5] Along the subway stops, it is possible to buy for $355 per square foot at Kennedy or $352 psf at Ellesmere. Millennials are more likely to want to live downtown, versus Scarborough, where prices range along subway stops in the higher $700s and up:

  • Queen $725 psf
  • Union $820 psf
  • Museum $1029 psf
  • Clair West $758 psf
  • Lawrence West $531 psf
  • Shepherd West $567 psf

Overall, along subway routes, condo price averages per square foot tend to be less along the east Scarborough lines (somewhat) and the most on the downtown Young line (pretty much all of it form North York to Union.) There are some relative “bargains” on the west stops such as Lawrence West and Ellington West (only $447 psf)

Beyond the Subway

Millennials are still willing to buy or rent further away from subways, but the overall transit time is the biggest factor. Streetcar routes tend to be avoided, major bus lines with many busses running preferred.

 

Millennials value connectivity highly. 84% of them do their mortgage and real estate research online.

 

Bicycle accessibility and bike lanes are also a factor in decision making as Millennials move away from the car. Family planning is also a consideration, with more and more people opting to raise families in condos, giving up the back yard for more time at home with the family — due to less commuting.

NOTES

[1] Tree Hugger 

[2] Neff, 2010

[3] Moneywise “What Millennials Want from the Housing Market”

[4] First-Time Homebuyers Survey CMHC

[5] Toronto Star, “Where the most (and least) expensive condo areas are along the subway.”

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