Implement opportunity zones in rural Ontario: OREA

The Ontario Real Estate Association (OREA) is lobbying the provincial government to elevate rural communities with crucial infrastructure development that will lead to job creation and reverse social decline.

Inspired by opportunity zones in the United States and the United Kingdom, which have been successful, OREA has released a report highlighting some of the issues rural communities, including those in Northern Ontario, face. According to OREA CEO Tim Hudak, many of these rural communities don’t even have broadband Internet connectivity or natural gas.

“The top question realtors get from their clients contemplating moving to rural areas is, ‘How’s the internet service?’ The reality is that in 2021, high-speed Internet should be an essential service, much like electrification across Ontario created massive change and great opportunities in the early twentieth century, and so too will broadband access create incredible opportunity in the twenty-first,” Hudak told CREW.

“The provincial government is off to a good start expanding natural gas, and for many small and northern communities, natural gas could be a lifeline to attract business expansion or to lower the cost of doing business, including in agriculture, and lower the cost of living for families in the area. What many people in cities take for granted, in terms of natural gas to warm their homes or run appliances, is a luxury in smaller communities.”

Opportunity zones are designed to help communities that have lost major employers, struggle with new job creation, and consequently suffer from social decline, by incentivizing large companies to move in. OREA began lobbying the provincial government to implement opportunity zones in rural Ontario before COVID-19 struck, but Hudak says such initiatives are even more imperative now that the pandemic has catalyzed migration from large urban centres to smaller, rustic communities.

“Small municipalities have lost many major employers, have shrunk and have less tax revenue to make adjustments necessary for infrastructure development, and the provincial government has the greatest role to play,” he said. “These places could be an inner-city neighbourhood with high crime and little opportunity, brownfield land of an industrial site in a small town, a community that lost one major employer and is heading downhill economically. The government could declare opportunity zones that result in lower taxes for businesses that are there or expanding there, and quicker approvals processes for job creation and affordable homes.”

According to Chuck Murney, president of the Lakelands Association of Realtors, which comprises Parry Sound, Muskoka, Haliburton and Orillia, the nascent trend of urbanites moving to exurban communities in search of affordable detached homes has already driven up home prices in areas serviced by essentials like broadband and natural gas. Like OREA, the Lakelands Association of Realtors has petitioned local MPs and MPPs for infrastructure improvements, but as more people migrate to rural Ontario, infrastructure has quickly become an urgent matter.

“The No. 1 concern for us, if you don’t live in the larger towns, is you’re restricted by the quality of Internet and not having natural gas, and it creates higher expenses and becomes a pain just to get quality service. We hear that from our membership as well as our clientele,” said Murney. “We’re running at our lowest housing inventory levels here in nearly 30 years and it’s putting a strain on the current market in that way too. Prices for non-waterfront properties increased by 20-25% across different communities in 2020. Towns that have the infrastructure— Bracebridge, Huntsville, Parry Sound—have seen the biggest price increases.”

Neil Sharma

Neil Sharma is the Editor-In-Chief of Canadian Real Estate Wealth and Real Estate Professional. As a journalist, he has covered Canada’s housing market for the Toronto Star, Toronto Sun, National Post, and other publications, specializing in everything from market trends to mortgage and investment advice. He can be reached at neil@crewmedia.ca.