I just finished reading a new book titled, "The New Urban Crises", written by Richard Florida, a well-known American Urbanist, Toronto resident and professor at the University of Toronto.
In it he describes the massive economic divide among the world's "superstar cities" as he calls them, and offers urban design solutions that can help resolve many of the problems.
Effectively with the rise of what he calls the creative class moving back to the cities from the suburbs (tech startups, media people, entrepreneurs, as well as the traditionally well-to-dos such as bankers, lawyers, doctors, etc), the cores and immediate surroundings of these areas are essentially pricing out middle to lower income individuals and families.
This is certainly palpable here in Toronto. The message in this book echos that of another well-known Urbanist, Jane Jacobs, in her classic book, "The Death and Life of Great American Cities". I first read this in the mid-90s in Architecture school, but it hasn't resonated with me until more recently. It is considered the bible of the new urbanism movement.
What Is New Urbanism?
In case you're not familiar with what new urbanism is, it's a movement that began back in the 1980s. It was in response to the policies which steered urban policy across every major North American city post world war 2, leading to the urban sprawl that is prevalent today.
Since the early 2000s, the response has been overwhelmingly for more affluent people to move back into the city cores, or along transit corridors. This has made property (especially single family homes) extremely unaffordable for most people (among many other reasons of course).
One of the solutions offered by Richard Florida is simply to build more. There is a key caveat though - not in the already expensive and denser parts of the city.
This is where the opportunity lies for you.
You see, the real reason why we don't have enough supply of housing is artificial constraints due to land use policy. If we make better use of some of the immediate suburban areas immediately outside the downtown core, we can access lower priced land and essentially turn these spots into mini-downtowns where people want to be - ideally to live, work, and play.
There's tremendous opportunity and profit to be had in creating better, more vibrant communities within the suburbs that are relatively close to the city core. Especially given the fact that the world population is going to continue to move into urban centers at a staggering rate in the coming decades. (1)
There are 2 ways for you to take part in this:
- Be a developer yourself to create these types of communities
- Invest in others who are pushing these types of developments
What I'm going to do is simply list the 10 tenets of new urbanism design, and how you can take advantage of these methods if you're an investor or developer looking to purchase or build housing now, and in the future.
10 Principles of New Urbanism (See note 2 below for a more detailed description)
- Mixed-Use and Diversity
- Mixed Housing
- Quality Architecture and Urban Design
- Traditional Neighbourhood Structure
- Increased Density
- Smart Transportation
- Quality of Life
Looking across our urban landscape, I see this as a huge opportunity for us to be involved in creating affordable housing supply, and vibrant neighbourhoods that people want to live and work in.
Why Isn't Everyone Doing It?
You're probably asking, "If it's so simple, why isn't it being done?". Great question - it's simple but not easy. It will require a lot of effort.
The land use policies in place are a huge force that is not easy to unwind, nor does everyone want it to be. NIMBYism is a powerful force (in the form or resident's associations and existing property owners who simply don't want change).
The work comes in the form of negotiating with city councilors, committee of adjustment members, and the residents themselves. A lot of it will be in the form of showing data on how changing the neighborhood can have a positive impact to their community and actually increase it's value.
Any progress will have to be about respecting everyone's input, and not about an "us versus them" approach.
Once you have the density in place, it would then justify the spending for better forms of mass transit as well.
If this is something you can be involved with, or at least provide support to those doing this, you can take part in this new urbanism movement - and of course profit from it.
No One Wants To Go To Walmart On The Weekends
Think about it - what is about ideal vacation destination that you enjoy, or even places you want to go to on the weekends? It's about walking, nice shops, cafes and restaurants - not walking across huge parking lots to get to a big box retailer.
So why don't we design our cities that way? Or at least help to re-design existing parts of it to become that?
There are huge opportunities if you're willing to put in the effort. I most definitely am - hope you will join me!
And don't take my word for it - listen to one of the most important thought leaders on this subject, Mr. Florida himself:
What I'm Investing In
In terms of my own investment journey, I will no longer be investing in the status quo. Going forward, I will be putting my resources (money and time) into projects that align with great neighborhood design.
As a matter of fact, I just recently invested in a project, and will be actively working in it to help push the vision described in this article. I'll provide some more information on that later, and keep you posted on the progress.
And yes, legal second suites will definitely be part of the strategy!