Major Canadian Cities Unaffordable – Leaving May Be The Best Option

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The cost of living has exploded over the last decade in Canada’s major cities with wages falling behind more and more every year. Housing costs have increased the most, with property prices, rent and even ownership costs like insurance suffering severe inflation. The two cities in Canada experiencing these increases the most are Toronto and Vancouver. Canadian’s are deciding the cost of living in these centres not to be worth the price with more people leaving these major cities each year. From July 2019 to July 2020, Toronto hit record-breaking numbers of people leaving the city – more than 50,000. Why are so many Canadian’s emigrating from these major cities? They are becoming unaffordable and it is often the best (and sometimes only) choice for people with financial goals such as home ownership or becoming financially independent. Especially young people who have less and less hope of entering the housing market. On the bright side, leaving is probably better than you think! Lets go over some common concerns of relocating away from a major city:


One of the most common concerns about leaving a major city is the lack of opportunity for available jobs and lower wages. While this may be true for top salary jobs, median salaries across Canada are very comparable to the major cities. Even wages in the 75th percentile are relatively close. It is actually easier for young families to earn over $100,000 outside of Toronto and Vancouver than it is living in the city. That income will also go much further!

Job availability is another concern, but unless you are in a very technically specific job this is also not likely to influence the average person. Job skillsets are usually quite transferable and the industry structure of most cities are quite similar. There may be fewer overall jobs, but the percentage is similar and the amount of people fighting for the jobs are less. Unemployment rates in Toronto and Vancouver are also similar to the rest of Canada. In 2019 Canada and Toronto were hanging under 6% with Vancouver slightly lower around 5%. Corporate jobs are even spread out around Canada more than you might think. Toronto houses about 25% of the head offices in Canada, while Vancouver holds just under 9%. While it is certainly a large portion, that is only 1/3 head offices. When broken down into job numbers, the combined amount for Toronto and Vancouver rises to 40% of Canada’s head office jobs. A significant proportion to be sure, but there is still many corporate jobs out in the rest of the country.


Another reason to be hesitant to leave a big city is because of the amenities. Vancouver and Toronto are host to some of the biggest events and shows in Canada. Toronto is the home of the only Canadian baseball and basketball teams in the highest professional leagues. Even everyday things like public transport are more developed in these cities. Obviously amenities increase the quality of life, but are they worth the costs associated with living in a major city? A census from statcan between 2009-2013 showed Toronto and Vancouver as the cities with the lowest average life satisfaction among all the cities included. It also showed the same 2 cities with the lowest number of individuals rating their life satisfaction between a 9 or 10. Even though they were not the worst, they had bad numbers for the amount of individuals rating their life satisfaction below a 6. Toronto had the 2nd most and Vancouver came in at 6th most. While this study is obviously a little dated, the costs of living has only gotten worse. It may be hard to think of life outside the city without the amenities you have become accustomed to, but it is clear their costs far outweighs the benefits.


A topic related to both happiness and employment: commuting. Average commuting time in Vancouver is 5 minutes (20%) higher than the Canadian average. Toronto has 10 minute (40%) longer commute times than the average Canadian. It may not sound like much, but an extra 10 or 20 minutes commuting 5 days a week quickly adds up. 20 minutes a day could easily be over 80 hours a year, the equivalent of having to work 2 extra weeks. The added travel time usually comes with added costs as well from additional public transit costs or personal vehicle operation costs.

Friends and Family

This is perhaps the most important reason people remain in the city. Family and friends are important and you can’t just find replacements in a new city or town. Even relationships like your dentist or hairdresser are hard (and inconvenient) to change. That being said, this is an intimidating factor that can be overcome. You can make friends in a new city and eventually find someone who cuts your hair the way you like it. It will be hard but can get better over time. Especially with technology now a days, it is easier than ever to stay in touch with family far away! There is no real way to put a value on being near friends and family but, unfortunately, you kind of have to. If you are feeling unsure, ask other people you know who have relocated. I’m sure you will be surprised with the amount of positive responses you get.

Effects on Finances

How much can changing cities really do for your finances? Lots. The average rent of a 2 bedroom place in Toronto and Vancouver respectively is $1,562 and $1,748. The average across Canada is $1113. Many bigger cities like Calgary, Edmonton and Ottawa still come in with an average of $1,400 or lower. Montreal is $855. To keep our estimate on the safe side though, we’ll use $1,400. That is $162 and $348 a month cheaper than Toronto and Vancouver. If a person spent half of that on whatever they wanted and invested the other half, how would that look over a 35 year period to retirement? It turns into a saved amount of $139,490 (adjusted for inflation) and $299,643. This could easily be the difference between retiring early, on time or not at all. This is also a very minimum amount of savings because the rent in Vancouver and Toronto is also going up at a faster rate than the rest of the country. Between 2018 and 2019, the average rent for a 2 bedroom increased by $100 in the two cities, double the amount of the average in Canada. Compared to other cities, Montreal was around the Canadian average of $50 and Calgary was below at about $30. If you expect to be renting most of your life, changing cities can literally earn you hundreds of thousands (if not millions) towards retirement if you include the opportunity cost of money. Not renting and prefer to buy? The average home price in Toronto in Vancouver is at least several hundred thousand dollars higher, whether you are looking at condo’s, duplexes or single family homes.

Toronto and Vancouver are great cities with plenty of reasons to live in either one. Unfortunately for young people, they have become unaffordable. Anyone struggling with desires for home ownership or financial security should consider relocating. Outside of these two cities you can look forward to similar quality jobs and likely shaving a good portion off your commute time. You may lose out on some amenities you have grown used to, but the benefits outweigh the cons and it is likely that relocating could lead to increased life satisfaction. Leaving friends and family is a challenge, but with the benefits of relocation, why not take them with you?

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