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Interprovincial Migration

A Record Number of Ontarians Continue To Leave The Province, But Where Are They Going?

Nearly 108,000 Ontarians left Ontario in 2021 due to the province’s unaffordable housing market. This is a number not seen since the early 1980s.

According to previously disclosed data, the exodus continued into the second quarter of this year, when an additional 49,000 inhabitants packed their bags and moved to another province. The province experienced its biggest quarterly net loss due to interprovincial migration as a result since 1971.

But where did everyone end up? A quarter of interprovincial migrants from Ontario, according to Statistics Canada’s estimates, went to Alberta. The Maritimes and Newfoundland and Labrador received another quarter’s worth of exports, with Nova Scotia receiving the majority of the newcomers.

For the first time in its history, Ontario imported more people from Quebec than Ontario sent to Quebec. In addition, British Columbia attracted the most newcomers from Ontario since the early 1990s.

At the same period, Ontario received 198,500 newcomers from outside Canada, a level not seen since at least 1946, according to a Scotiabank research. However, inter-provincial migration is having an impact on the housing market in Alberta and the Maritimes.

Alberta and the Maritimes are the big recipients of interprovincial migration

An inflow of Ontarians has historically been the rule rather than the exception in Alberta.

Many Canadians moved to Alberta and Saskatchewan in search of employment during the 1980s oil boom and the most recent significant one, which ended in 2010. This was underlined by Scotiabank in its research. One of the main reasons Ontarians are moving to the West these days is the appeal of cheaper housing.

There is no land transfer tax on residential real estate. If you compare housing prices in Alberta to those in Toronto or other significant eastern cities, you’ll find that they’re significantly lower everywhere.

Data from the Canadian Real Estate Association (CREA) show that in August, the average home price in Alberta was only $423,879, whereas it was $829,739 in Ontario.

However, the reasons why so many Ontarians have fled their home province go beyond the expense of housing. A significant factor in their decision to relocate to Wild Rose region was also the availability of distant employment for Ontarians.

Nova Scotia is similarly affected by that same element. The second quarter marked the biggest net increases in interprovincial migration for both Nova Scotia and New Brunswick since 1971.

After completing their studies, many residents leave the province in search of lucrative employment—primarily to Ontario, Alberta, or British Columbia. People are now able to take their jobs home with them. A large portion of that interprovincial migration consisted of Nova Scotians moving back.

As a result, Nova Scotia now has one of Canada’s fastest-growing housing markets. Only a few provinces, including this one, have seen housing values hold steady despite rising interest rates and a deteriorating economy. The average price of homes sold in August 2022, according to CREA data, was still over 18% higher than it was the year before.

Even though the Calgary housing market just surpassed its record high from 2014—the year that the world’s oil markets went into a massive tailspin—Alberta also experienced significant growth in the housing market in 2022.

Since then, prices in Alberta have fallen, not just as a result of the national slowdown brought on by rising interest rates, but also as a result of a rise in the number of housing starts compared to the first six months of the epidemic.

Prices have retracted a little bit, and the market has slowed down a little. The province won’t likely see a demand shock anytime soon with so many homes for sale and more on the way.

Meanwhile, Ontarians are envious of the lush grass beyond their province’s borders. Nearly half of all prospective homeowners under the age of 45 had thought about moving outside the province to purchase a home, according to a survey done in early June for the Ontario Real Estate Association. Among purchasers under 30, one-third think they’ll most likely sign a mortgage in another province or territory.

The possibility to live outside of Ontario while working there is another factor, however, housing affordability is the main cause of out-migration.

The pandemic-related inter-provincial movement is a bit alarming despite a long history of migration to other provinces. If Ontario is going to lose young talent, this is a new trend and one that does not portend well for future progress.

The results of Scotiabank’s investigation point in a different direction. According to a recent study, a net loss of 31,000 Ontarians annually due to immigration and interprovincial migration would only have a minimal 0.02 percentage-point impact on economic growth over the course of two years.

According to the analysis, Ontario’s rising appeal among recent immigrants to Canada would offset ‘worst case’ interprovincial headcount losses.

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