It is being reported that although Canada’s real estate market might be undergoing some turbulence, small homes are becoming increasingly popular with residents who want spare time and affordable options; for example, The Canadian Press reports that tiny homes only a kilometre from downtown Victoria are in high demand, as they offer people a manageable and simple way of life. For investors, this means focussing on smaller properties that could attract rental and higher resale values.
One case study of why smaller homes are working for many Canadians is that of Thelma Fayle. Battling respiratory disease, Ms Fayle found trying to keep her home, with many towering trees and a swimming pool, exhausting. Then, nine years ago, she moved from her 4,000-square-foot home to a tiny house only nine feet wide in rural Victoria. Now it takes just two hours to clean her entire property. ‘I decided I didn’t really want to spend the last third of my life rotely maintaining a huge house,’ she explained.
There have been growing reports from Canadians that the primary reason for downsizing and seeking small homes is the desire to save time so that they can enjoy their hobbies. There are also environmental considerations; for example, smaller residences don’t require as much heating. Then there is the price issue, with many Canadians priced out of their local city by soaring prices. This means many people are looking for tiny homes within their affordability bracket.
When Ms Fayle bought her small home in 2006, it cost just $275,000 – single-family homes were rare finds for less than $500,000. Adam Ochshorn, a Toronto-based developer, said his firm, Curated Properties, was using the niche market to build small homes for families priced out of cities but not wanting to live in a high-rise or migrate all the way into the suburbs.
The firm has several projects currently on the go that combine traditional multi-floor living with a terrace, lower price points and unconventional spaces. One development is a yarn factory conversion that is located between two housing rows in a lane. Developments such as this are not always easy, with the city of Toronto not allowing developers to dig utilities, such as sewage and water pipes, into lanes. Mr Ochshorn got around this problem by buying a connected residential property, thereby allowing street access. In another of the company’s projects, a dozen townhouses are being built on top of a two-storey office. Homes here will have outside space and multi-storey living. In the future, Mr Ochshorn believes current restrictive policies will loosen as city officials realise the need to create new development opportunities.
For overseas investors looking at the Canadian market, major cities such as Toronto remain a good investment, whether the property is a family detached house or a luxurious apartment; however, with many local residents being priced out of the sector and looking for smaller options, the tiny house is likely to gain in popularity. Taking an interest in this sector early on could provide some lucrative dividends for savvy investors.