Buenos Torontio

A friend of mine just came back from Buenos Aires, a city more than twice the size of Toronto, and with an unusual status that large cities should be looking at and considering emulating.

Because Buenoes Aires, you see, is not a city.

And, despite often being referred to as Argentina’s homage to Paris, it’s not, technically, in Argentina.

Its correct name is Cuidad Autónoma de Buenos Aires, or “The Autonomous City of Buenos Aires.” And although this status was constitutionally formalized in 1994, Buenos Aires was federalized in 1880, more than 130 years ago.
What does this tell us?

That large urban centres are a natural resource, that they need to be treated with the same care and attention as national parks or national historic sites, that they are important and beneficial to their provinces and their countries and that attention (and money) must be paid to them.
Toronto, as Canada’s largest city, is on obvious candidate for some sort of Special Status, as are Montreal and Vancouver.

Ottawa was chosen as Canada’s capital for logistical reasons.
Americans were still hopeful that they could unite all of North America into a single entity ruled from Washington.

Britain was nervous about defending a Canadian Dominion so rich, but so vast and inhospitable.
Queen Victoria’s emissary, Colonel By, was charged with finding the ideal location for the new capital city, and found a swampy mess of a site for the new Dominion’s Capital that was not only very distant from the American border and hence American troops, but was topographically defensible (it’s hard to advance soldiers through a swamp).

Canada’s Capital City, Ottawa, should have special status.
But so should Canada’s City of Capital, Toronto.

1989

I was just asked an interesting question: is the Toronto market in 2019 like 1989?

Nope.

But I thought the answers I gave might be of general interest, and worth repeating.

LEVERAGE: “Buyers” in 1989 were buying with little oversight, with miniscule deposits of $500 to $1000. with further deposits far in the future, and with no understanding or thought of closing to re-sell or rent. They were unqualified and leveraged, not to the hilt, but far beyond the hilt. Today’s buyers, with typically 20% cash deposits, with mortgage approvals in place before the 10 day recission period has passed, are a different breed. Does it leave a lot of marginal people who would like to be buyers on the sidelines? Sure. But marginal buyers without the means to complete their transaction do not contribute positively to a healthy balanced marketplace.

DEMAND: Population growth leads to rental demand and purchaser demand. With vacancy rates at historic lows, tenants are willing to pay premium rents for brand new condominiums. With the majority of end-users unwilling to gamble their lives on predicted delivery dates, brand new never-lived-in condos, originally bought at pre-sale by investors, are eagerly anticipated opportunity by end-users when they come on the market, and those end-users are prepared to pay a premium for the certainty of seeing finished product with a guaranteed delivery date.

SOCIAL SHIFTS: Toronto is dramatically different from the Toronto of 30 years ago. Condominiums are the dominant form of housing. Living downtown is not a novelty for trendy urbanites and bohemians, but a mainstream option, so much so that Coca Cola is just one of a number of companies choosing to relocate downtown because that’s where their employee talent pool is, highlighting the other trend: people want to live and work and play downtown. Commuting has become anathema, so much so that one Toronto survey recently reported that fully 40% of Torontonians walk to work: there’s a sea change. And as with everything, the bigger the downtown population, the more there is for them to do, accelerating the urbanizing trend.

That’s what my 10,000 hours tell me.