Ontarians on the Move, 2021 Edition. #10 — The pre-pandemic correlation between home price increases and population growth in Southern Ontario

Toronto (R² = 0.2907, but in wrong direction)

Barrie (R² = 0.0275)

Hamilton (R² = 0.1085)

North Bay (R² = 0.1911)

Tillsonburg (R² = 0.2521)

Woodstock (R² = 0.2657)

Guelph (R² = 0.2850)

Brantford (R² = 0.3489)

Ottawa (R² = 0.3850)

Kitchener-Waterloo (R² = 0.4312)

Niagara (R² = 0.4401)

London-St. Thomas (R² = 0.9134)

In Summary

  1. In the Toronto market, there is no visible link between population growth and home price increases, and, if anything, the relationship is the opposite of what we expect. Unlike much of Southern Ontario, population growth in 2016–19 wasn’t particularly robust, as an increase in international migrants was offset by population growth to the rest of the province, thanks in part to drive until you qualify.
  2. There is a strong relationship between home price growth and population growth, but it’s not a particularly neat one. In markets 100km or less from Toronto, the home price growth due to population growth was driven up higher through the actions of investors, speculators, and FOMOs. This caused a “correction” in 2018–19, but in many instances, that correction was still prices rising faster than inflation.
  3. In communities more than 100km from Toronto, we didn’t see that home price growth bubble in 2016–17, and the correlation between population growth and home price growth was tighter.
  4. London’s different, man.

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Senior Director, Smart Prosperity. Assistant Prof, Ivey Business School. Exhausted but happy Dad of 2 wonderful kids with autism. I used to do other stuff.

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Mike Moffatt

Mike Moffatt

Senior Director, Smart Prosperity. Assistant Prof, Ivey Business School. Exhausted but happy Dad of 2 wonderful kids with autism. I used to do other stuff.

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