The housing market in Toronto vs Vancouver: What you need to know

Intro

Let's face it: anyway you cut it, it's a darn tough time to be in the home buying market. Even if you’re selling a home to pay for another, home prices are, pardon the pun, through the roof. In the United States, home values have, on average, increased from $389,400 U.S. dollars in 2020 to $408,800 U.S in 2021. The average sale price of a home in Canada was $688,000 in July of 2021. Perhaps you’re thinking, “that doesn’t seem too bad.” Well, that American statistic is the average nationwide, meaning it includes both a home in rural Oklahoma and a New York City penthouse. That Canadian number? That’s a jump of 38% year over year.

It’s pricey to buy a house.

Big cities and their surrounding areas are seeing record sale numbers and two of the most popular Canadian cities, Toronto and Vancouver, are shattering those records daily. If you’re between these two stellar locations, you’ll need to be prepared. Here, we’ll take a look at the housing market in both cities and get you prepped for buying.

What do these spots have in common?

Vancouver and Toronto are very different cities with different vibes. One is toward the east of the nation, the other all the way to the west. One offers stunning mountain views and trails, the other is kind of flat. Both are closely connected to their American neighbours to the south and, most importantly for this article’s sake, both are monumentally expensive to live in. Let’s get that right out of the way up front. Affordability and these two cities do not go together.

These are also Canada’s two largest cities. They’ve got great restaurants, awesome nightlife, and excellent communities. There’s ready access to excellent schools, and because they’re large cities, there are plenty of jobs.

There are, however, a few key reasons why you might not want to live in one of these two outstanding cities. First, the actual costs.

The almighty dollar

Aye, indeed friends, it is expensive to live in either city. Mortgage debt is now 89% of Canada’s GDP, which represents the value of all of the products in a nation. In short, people are paying a lot of money for housing.

Between the two cities, however, Vancouver is more expensive. It’s nearly impossible to get a detached home for under a million dollars. This is a function of location and popularity. The city core is hemmed in on three sides by the Pacific Ocean, which means there is a finite amount of land on which you can build. This makes any home with land extremely valuable, the average being up over $1.8 million. A townhome will still run you $950,000 and a condo or apartment will cost, on average, just over $750,000. Moreover, homes don’t stay on the market very long and those homes that do often need some serious work. If you were looking for a turnkey option, you should be prepared to pay a premium.

Toronto, on the other hand, while still expensive, is ever so slightly more affordable. The mortgage cost of a home or condo in the city proper has actually begun to fall, though not to any “low” price per se, from $1.105 million in May to $1.097 million in August of this year. Perhaps telegraphing the move from the city to the suburbs during the pandemic, the average cost of a home in the Greater Toronto area is still on the rise, from $1.045 million to $1.059 over the same period. There are, however, some opportunities to live a bit farther outside of Toronto and realize some benefits of both the city and relatively cheaper accommodations.

Price, however, may not be the most important aspect for determining where you live. The atmosphere, proximity to other places, outdoor activities, restaurants, and even the weather could make the choice for you.

What you are buying in each city

Atmosphere

Perhaps the starkest difference between Vancouver and Toronto is the style of living. It may be best to look at a very recognizable example outside of Canada to make sense of this: Los Angeles (Vancouver) versus New York City (Toronto). Vancouver is a bit more relaxed and slower-paced. Lifestyle is, in many ways, the defining factor, as opposed to the work that one does. The outdoors is incredibly important and, anecdotally, folks are a bit more “friendly.”

New York City/Toronto, on the other hand, is fast-paced and urban. The former is often called the City that Doesn’t Sleep and, in many ways, Toronto is the same. The largest city in Canada, its buildings will often remain illuminated 24 hours a day. As the center of finance and business, Toronto has plentiful jobs in a variety of different market industries.

Proximity to the World

Vancouver is a city hemmed in by water but by air, you can be almost anywhere you’d like to go fairly quickly. Los Angeles, San Francisco, and Las Vegas are just a short flight away, while it's easy to take a day trip by car to Seattle. It’s also quite easy to hop on a plane and be in Tokyo in just eight hours. This may sound like a lot but that flight will take you 15 hours from Toronto with a stop in, you guessed it, Vancouver.

Toronto is intrinsically linked with its American neighbours. Americans and Canadians cross the border for shopping and dining frequently, with Buffalo seemingly next-door and Detroit just a short three-hour drive. Toronto is also closer to other, more populated parts of Canada, including Ottawa and Montreal. If it’s Europe you’re after, Toronto is the city for you. A flight from Toronto to London, nonstop, is just seven hours, Paris just an hour longer.

In short, if you’re interested in traveling to Asia, Australia, or the west coast of the United States often, Vancouver is the ticket. If your travels take you to Europe, New York City, Boston, or anywhere to the east, Toronto is the place to be.

Outdoor Activities

Much like its U.S. west coast cousins, Vancouver is the place for hiking, trail running, skiing, and boating. It’s simply a more outdoor-focused place and it’s not difficult to understand why: it’s stunningly beautiful. With its wide views of the Pacific, massive national parks, and stunning peaks and mountain lakes, Vancouver is one of the most beautiful places on the planet, let alone in Canada. You can be on the beach in the morning and take a few runs down the ski hill in the afternoon, with just a short drive in between.

Toronto has its own outdoor charms with its proximity to Niagara Falls and Lake Ontario. The focus here, however, is mostly on the city so if you’re more of an inside dweller, Toronto is the place for you.

Nightlife and Dining

Both towns have their charms, but Toronto takes the cake on nightlife and dining. A true melting pot city, with lots of cultural diversity, Toronto is up there with some of the best restaurants around. From Asian cuisine to Italian, Pakistani to French, you’ll find exactly what you’re looking for. Being a big city, it’s also chock full of cultural opportunities like the symphony, Broadway-style plays, and, if you’re more of a club person, a plethora of options to dance the night away. Vancouver also has these options and certainly has its fair share of awesome restaurants, but Toronto is just a step up here.

Weather

It can’t be ignored. The weather in both cities is distinct and is rather an important part of life. Toronto tends to be either hot or downright freezing with snow and ice. Moreover, the wind through the tall buildings downtown can chill you right to the bone. Vancouver, on the other hand, is temperate but wet. Just like its city to the south, Seattle, it pretty much rains all the time. You’ll enjoy some snow at higher elevations but have the umbrella on hand pretty much every day.

Which City is Right for You?

Selecting a new place to live can be stressful. Having a firm understanding of the costs, as well as some of the other factors that make each city unique, will help you to make an informed choice between Vancouver and Toronto. Most importantly, make sure you have a plan to pay that mortgage bill because it’ll be high in either location.