The housing needs of tech workers in cities like Waterloo, Ont., tend to converge around a few key priorities, such as proximity to the innovation district.Getty Images
Canada’s real estate markets face volatile economic pressures, but the crosswinds appear especially strong in technology-centred communities such as Vancouver, Waterloo Region and Windsor, Ont.
Each of these tech communities is different, but experts have been watching these markets bending and twisting thanks to forces ranging from recent layoffs in the tech sector to longer ongoing trends such as the growth in remote and hybrid work.
They all share the common characteristic that the housing expectations of technology workers, such as software engineers or IT developers, often differ from those in other sectors.
“Young tech workers have an urban focus. We recognized that from a planning perspective and developed an LRT [light rail transit] system which opened in 2019 and that led to a dramatic shift in housing types,” says Kevin Eby, former director of community planning for the Region of Waterloo.
“There’s lots of data to show that there was a shift in Waterloo from single-family homes to mid-rise and ultimately apartment buildings,” he says.
Waterloo realtor Mike Bolger, says, “navigating property values in Waterloo can feel like a puzzle,”
“The housing needs of tech workers in Waterloo tend to converge around a few key priorities,” he explains. “Many are looking for flexible living spaces that accommodate remote or hybrid work lifestyles. Proximity to the innovation district, where startups and co-working spaces are bustling, is a big draw. These [workers] are looking for homes that support a balanced lifestyle.”
There’s lots of data to show that there was a shift in Waterloo from single-family homes to mid-rise and ultimately apartment buildings.”
— Kevin Eby, former director of community planning, Region of Waterloo
The puzzling part is how the ups and downs of the tech sector affect local real estate during different business cycles. In July, Kitchener-Waterloo-based OpenText laid off 1,200 workers. It was preceded by an unspecified number of layoffs at Waterloo-based Blackberry Ltd. and an also unspecified number of cuts to the region’s workforce by Google Canada, whose parent company reduced its workforce by 12,000 in early 2023.
“It may seem like the market is sending mixed signals,” says Mr. Bolger. “We’ve seen a softening in demand, but on the other hand, the market remains resilient, buoyed by an ongoing influx of new talent attracted to the region’s strong tech ecosystem and the expansion of other companies eager to tap into the available workforce.”
Even if housing is in short supply, affordability isn’t necessarily a problem for tech workers.
According to CBRE, the average software engineer in Waterloo (and the more expensive Greater Toronto Area) can expect to pay only 14 per cent of their base wage on renting an apartment, a percentage far below what struggling individuals and families in other sectors are paying.
Waterloo’s market is skewed though, by other factors, such as the large numbers of students attending Waterloo and Wilfrid Laurier Universities and Conestoga College, who increase demand for rental housing, Mr. Eby says.
“A huge number of mid-rise and rental units became student-focused. How the tech sector has also impacted prices of real estate is almost impossible to separate from the increases in enrollment at the universities and the college, especially the huge increases since 2016 of foreign students and foreign temporary workers,” he says.
To complicate the picture, “we also have had an influx of people from the GTA as well as an exodus from here to other places during the pandemic,” Mr. Eby says. This makes it hard to separate the effects of the tech sector alone from housing in the region, he explains.
The Vancouver market is different in that there is a physical limit on how much housing can ever be available in British Columbia’s Lower Mainland. “We’re constrained by the ocean, rivers, mountains and the U.S. border,” says Wendy Waters, vice-president of research and strategy at GWL Realty Advisors in Vancouver.
“Housing, industrial and commercial use is further constrained by the agricultural land reserve that preserves land for farming and food production. The result is limited space for commerce and for housing,” she says.
“High density is the only solution to keeping rents and ownership prices from rising faster than average incomes,” Ms. Waters adds, which is why a tight supply means more tech workers are looking at areas outside Vancouver.
Windsor’s housing market, on the other hand, is more diverse and resilient due to its traditional manufacturing base and recent investments in sectors like EV/battery manufacturing, says Jason Moore, the city’s senior manager of communications and customer service.
“While tech sector fluctuations can certainly impact housing prices…our market is less likely to experience extreme volatility,” he says, “but we need to monitor and potentially adjust housing strategies to accommodate sector-specific demands.”
In all markets, it helps to work with an experienced local agent, Mr. Bolger says.
“Someone with insights into neighbourhood trends, pricing strategies and the specific needs of tech workers can make all the difference in finding the right property,” he says.