The flight from big cities is taking people to places where houses and yards are bigger. Also, property taxes.

A funny thing about Toronto and Vancouver, the country’s two most expensive housing markets: They’re both property tax bargains, as is Calgary. In leaving big cities like these, you could end up paying more for property taxes and other things as well.

The migration of people from cities to bedroom communities and into rural areas is one of the many trends that have been intensified and accelerated by the pandemic. Before, people moved from the city for cheaper prices. Now, physical distancing in the pandemic is driving housing needs and preferences.


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Proximity to restaurants, culture, public transportation and other aspects of the urban experience are less valuable now than a larger house with space for one or more home offices, a playroom for kids and a yard where you can have a firepit for an outdoor patio experience in winter.

You might find a cheaper home in the outer suburbs or beyond, or spend the same amount and get more value. Either way, there are some added costs that should be part of your thinking when considering a move out of the city.

Property taxes are a good place to start. Altus Group, a real estate services company, has reported that residential property taxes on average cost $8.91 per $1,000 of assessed house value in 2019 for 11 cities across the country. Vancouver was cheapest by far at $2.56 per $1,000 of assessment, while Toronto came in at $6.15 and Calgary at $6.65. At the high end were two cities with affordable housing markets, Halifax at $11.96 and Winnipeg at $12.33.

Within the province of Ontario, Toronto’s property tax rates were found to be the lowest among 35 municipalities in a 2019 survey by the real estate listings website Zoocasa. More houses and more expensive property values help keep property tax rates in big cities lower. An HGTV comparison done this summer found that a Vancouver home assessed at $1-million would have a property tax bill of $2,468 annually, while a similarly assessed home in Halifax would have a tax bill of $11,085.

The move out of cities is based in large part on the idea that people have more latitude than ever before to work from home and avoid the cost of commuting as measured in time, money and mental health. But there are two competing work-at-home narratives right now – employers are loving the possibility of reducing the size of their workspaces and leasing costs, but they’re also starting to worry about the productivity of workers they never see.

The cost savings of working from your family compound outside the city may be temporary and, even if they’re not, families tend to need to rely more on their vehicles when they live in a suburban location. One-car urban families can become two-car suburban households, which can mean a big bump in monthly expenses. I’m as surprised as you are to find out from J.D. Power that the average monthly payment on a new vehicle in September was close to $680.

Vehicle insurance costs can be a bit like property taxes in some cases – higher costs outside an urban centre. A recent LowestRates.ca survey of the 15 most expensive Ontario cities for car insurance ranked Brampton, a 45-minute drive from Toronto in good traffic, at the top. Toronto was on the list, but it ranked behind suburban Markham and also Mississauga.

You’ll also need more gear if you move from a home in the city. This may explain why sales of small tractors, the kind you might need to manage a rural property, were up almost 30 per cent in August on a year-over-year basis. Those properties are ideal for swimming pools and decks, which were in such demand this summer that there were lumber shortages in some communities.

The changes people are making in where they live in the pandemic are driven mostly by emotional factors, which makes a lot of sense because the pandemic’s main impact on a lot of us has been psychological. We’re stressed, angry – having our own space seems an antidote.

Don’t jump into life farther afield before pricing it out. The more thorough you are in figuring out costs, the more comfortable you’ll be in your stronghold far from the city.


This Globe and Mail article was legally licensed by AdvisorStream.

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Darryl Smith, RFC
Senior Financial Advisor
Synergy Life Financial
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