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In this video Chris Molder, Toronto mortgage broker, sits down to review details of the recently announced federal immigration targets. From 2021 to 2023 Canada is set to welcome 1.2M newcomers. How will these new immigrants impact GTA real estate?
Below, we talk a bit more about your weekly mortgage questions!
Don’t feel like watching? Find the full transcript below!
New immigration targets post-pandemic
[00:00:00] Today, I want to talk to you guys about immigration at the end of October 2020. The federal government announced its very ambitious immigration targets for the next three years. So I want to take a closer look at the context of those immigration numbers, why they’re important, especially to us here in the GTA and what it’s going to mean for real estate and what it’s going to mean for the post-pandemic recovery. Come along. Let’s take a good look together.
[00:00:29] So first off, let’s take a good look at where this directive is coming from. Here I am on the Government of Canada website. This is the 2020 annual report to parliament on immigration we’re checking out. It’s actually quite interesting to read lots of information here, but I want to skip ahead to the immigration levels plan. And here we can see for the three years, the next three years, starting in 2021, the projected admission targets.
Reviewing the new immigration targets
So 401,000 newcomers in 2021, 411,000 in 2022 and 421,000 in 2023. So these are some pretty significant numbers higher than anything we’ve seen before. And what’s interesting is that we know that approximately 46% of newcomers that come into Canada make southern Ontario their primary destination. And that’s for a number of reasons. But it’s driven by jobs and, of course, by the accessibility of a place like Toronto and the GTA that is very welcoming to newcomers.
[00:01:45] So let’s take another look at what Ontario is projecting in the next slide here. So I’m now on the Ministry of Finance for the province of Ontario’s website, and we’re looking at Ontario population projections. Update 2019 to 2046. And on the site here, there are some interesting projections. And one in particular that caught my eye is the contribution of natural increase and net migration to Ontario’s population growth from 1971 all the way through, projecting forward to 2046. So I don’t know if you can see this, but the natural increase is the darker line down here. So this is natural birth and death rates. And we can see this is the line, this is the current time, 2020.
Predicting lower birth rates in the future
We can see that the projection is stable and then a general decline in the future, which is a trend in many developed nations that birth rates are going down. And the bright blue line is immigration over the years. And you can see we’ve had spikes and decreases over the decades, more recently, a trend downward and then this trend upward. But certainly, the line has been around, well, around 100,000 new Ontarians coming to the population. But with this federal government projection or anticipated policy of adding new immigrants, you can see that this is despite covid. We see a drop here because on account of covid, then a bounce back for all that pent up demand.
[00:03:32] But we can see that going forward. The projection is unlike anything we’ve seen in the past when it comes to population growth in the province of Ontario. So now the stage is set. We have all these newcomers being welcomed into Canada and southern Ontario. So what’s that going to mean for real estate? Well, pre-pandemic, we arguably already have and still do have a very significant housing crisis in Toronto and the greater Toronto area.
Now, you add the newcomers and whatever, but we’ve been suffering in the past is going to be pale by what’s coming in the next decade. And that’s going to do nothing but drive up real estate prices even further. Even the condo market, I mean, right now the narrative has changed due to the pandemic. Of course, people don’t want to be in the city, but I think that’s short-lived. I think the macro is still very strong and we will see people return to the city. It’s a very desirable place to live. Now, the immigrants coming in and I think the next 10 years are going to be unlike anything we’ve seen before. So that is my take on the federal government’s recent immigration policy. I hope you enjoyed it.
[00:04:52] My name is Chris Molder. I’m a Toronto mortgage broker. You can find me online at Tridac Mortgage Facebook. Twitter, website. Do you have any questions or concerns about just a phone call or an email away before now?
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