Contagion in the Markets? Covid-19 and Housing in the Greater Toronto Area

The Covid-19 pandemic has had crucial impacts on housing markets as working from home has become a new normal for certain economic groups. In this paper, we analyse the specific role the pandemic played in worsening the ongoing housing affordability crisis in the Greater Toronto Area (GTA). The GTA has, in fact, been experiencing a housing crisis since the early 2000s. In this paper, we argue that this continuing affordability crisis stems from the economic growth model that was embraced in the late 1990s, and we discuss why the existing market-oriented housing model has failed. The economic growth model of the Toronto region depends on the convergence of the financialization of housing and massive suburbanization. Because of this, the new wave of suburbanization that has accelerated with the outbreak of Covid-19 is not a new phenomenon for the GTA. In the final analysis, we also illustrate that the ongoing Covid-related-suburbanization in the GTA has deepened the housing crisis as the region continues to be less and less affordable.