At the beginning of 2021, 32% of Canadian workers aged 15 to 69 worked the majority of their hours from home.
In 2016, that number was only 4%, according to Stats Canada.
Though some believe that the changes to our working styles are permanent, it’s likely that we’ll see somewhat of a return to work for many employees if COVID-19 cases fall and remain relatively low.
There are many ways the real estate market could react to more and more Canadians returning to work.
Here’s a look at some of the potential changes we could see take place over the coming months and years.
1. Renters could return to city centres
The return to work in major city centres is likely to draw more renters back to downtowns across the country. At REW.ca, B.C.’s largest home search platform, search data reveals that rental searches in the City of Vancouver were up 40% month over month in July 2021, and up 35% in Toronto. These search habits could indicate that more renters will return to major cities this fall.
Few major North American cities have built more apartment units per capita in the last decade than in Canada’s three largest metropolitan areas, and with softening rental markets, inventory shouldn’t be a problem.
Another potential situation that could be unfolding is the return of more renters to areas near post-secondary institutions. Remote learning will continue to be the preferred method of education across the country for the remainder of the year, but should the return to the office prove to be successful this fall, the return to school could be next.
2. More renters lead to more investors
As renters return to city centres, expect investors to follow. Single-family detached home inventory is scarce, but investors currently have more options in the Canadian condo market.
Greater Vancouver condo prices pulled back slightly in July 2021, and are currently flat from where they were three years ago. With the Canadian market finally cooling after a peak in March 2021, sales of condos have consumed a rising share of the market.
More renters, more immigration, low interest rates and flat condo prices should continue to push investors off of the sidelines and into the resale market in several major Canadian cities. We’re already seeing investors jump into new developments at a high rate, as pre-builds have become an attractive option for those looking to secure today’s interest rates, among other reasons.
3. Work flexibility and the potential impact of semi-remote work
Though the inventory for detached homes and townhouses may be scarce, that doesn’t mean that the preference trends we’ve seen from buyers will drastically change with a semi-return to work.
For some, commuting two days per week will make a move to the suburbs more desirable, especially if their employer announces that a flex schedule will become permanent for their position. Expect people in this situation to continue to weigh the options of a move outside the city, where a down payment goes further per square foot than it would in a city centre.
With many workers returning to the office for just a few days a week to start, there will also be a continued interest in renters and buyers needing spaces with home offices. This is a change that new developers and those tackling renovations have paid close attention to, so expect the demand for home offices to be one of the trends brought on by the pandemic that is here to stay.
Whether it comes quickly or slowly, the return to work will no doubt have a significant impact on Canada’s real estate landscape for years to come. Renters, buyers, sellers, and investors will watch and adjust to the trends in kind, with changes in housing preferences likely to continue throughout the near future.
Justin Kerby is a columnist for REW.ca, Canada’s premier home search platform.
