London isn’t building enough homes.
That’s the message from a report done by a leading economist for the London Development Institute and the London Home Builders Association.
The report expresses concerns that family-sized homes are being built outside of the city, meaning people pay taxes to other municipalities, but use some services in London.
“Many of the provincial government’s proposed solutions are more focused on Toronto and the Greater Toronto Area (GTA) than cities outside of it,” said LDI executive director Mike Wallace said in a news release. “We need planning tools and local solutions that will work in London.”
According to the report, which was prepared by economist Mike Moffatt, the London area (which includes Middlesex and Elgin counties) is the fourth fastest growing metro area in Canada.
Much of that growth has happened due to people moving to the area from the GTA. However, that growth is shifting to places outside of the city like Ilderton, Lucan, or Thames Centre.
Census data reveals that from 2012 to 2016, 89% of Elgin-Middlesex’s population growth occurred in the City of London, but from 2017 to 2021, this proportion dropped to 76%.
“We see the evidence of this crisis everyday. Demand is so high, waitlists for new builds and renovations can be a year or longer. Rental availabilities are scarce, as are for sale signs,” said LHBA CEO Jared Zaifman. “Our organizations wanted to look below the surface of these traditional indicators. All of us need to better understand the supply crisis facing our city. Rather than opinion, we wanted hard data.”
Over the last five years, single-detached home construction was up 10% in London. However, in the rest of Elgin-Middlesex outside of London, it is up 80%. In that same time frame, more than half of all single-detached homes and a whopping 96% of semidetached homes built in the area are outside of the City of London.
The rising demand and limited supply has meant significant increases in home prices in the region.
The London-St. Thomas Association of Realtors says the average price of a home in the community was $793,222 in January – an increase of more than $350,000 from January of 2020.
“Increasingly, the housing being built to support that population is being built outside of the London’s municipal boundaries,” said Moffatt, who is the Senior Director of policy and innovation at the Smart Prosperity Institute and an Assistant Professor at Ivey Business School.
You can read the report here.
