Tonight I saw one of Toronto’s new streetcars cruising down King Street. They’re still in test mode and the first batch won’t go into operation until this August, but every now and then you’ll see one circulating around the city. This was the first one I’d seen in person.

If you’re a transit geek or urbanist, you’re probably excited about the arrival of these new streetcars. But I know that there are a lot of people who aren’t. They hate streetcars and they think of them as basically rolling stop signs on our congested downtown streets. And since these new streetcars are even longer than our existing ones, they’re worried they’ll just make the situation worse.

Personally, I think that streetcars mixed into traffic is generally pretty inefficient. But I know that surface light rail has the potential, when executed properly, to be a cost-effective and sustainable way of efficiently moving lots of people around a city. When I lived in Dublin I took the Luas every day. It was great.

So I’m curious to hear from you. What do you think of Toronto’s new streetcars? Let me know in the comment section below.

With Toronto preparing to deploy the first batch of its new streetcars this summer, there’s been a lot of talk about streetcars in general. Rob Ford has said he wants to get rid of them all together and I hear a lot of other people expressing similar frustrations: Streetcars are rolling stop signs. Streetcars block 2 lanes of traffic. Why don’t we just use more buses? Streetcars cause traffic. And so on.

So what should we do?

First, let me start by saying that buses suck. I’m a huge proponent of public transportation in cities, but there’s nothing quite like a rush hour bus ride to have you question your economic status in life. Bus routes have also been shown to have little economic development value, where as fixed rail lines (such as streetcar, LRT and subway) generally increase surrounding property values and spur investment.

Second, my view is that streetcars themselves as a transportation technology aren’t the problem. It’s our execution. I’ve touched on this topic before on ATC, but I’d like to reiterate a few points here. 

The value of light rail is that it’s a relatively inexpensive way (compared to subway) of efficiently moving a lot of people. But in order to do that, you need deploy it in a sensible way. In my mind, that primarily involves 3 things: giving streetcars their own dedicated lanes (grade separation), having a reasonable number of required stops, and streamlining the onboarding and off boarding process. Today, we don’t do a great job at most of these things (although our new streetcars will use a proof of payment model).

Take a look at this comparison between Dublin’s Luas light rail system and Toronto’s streetcar system. Both images are at the same scale. Notice the dramatically different stop spacing. Much of the Luas system also runs on its own dedicated lanes.

Dublin:

Toronto:

Every time a Toronto streetcar stops it generates waste. Cars are forced to stop behind it. Everyone on the streetcar has to sit and wait while somebody fumbles through their change looking for a token. But there are other ways to do this. There are ways to make light rail more subway-like, despite the fact that it may be above ground.  And so I don’t think we should be so quick to write off all streetcars.

Atlantic Cities just posted an article on the world’s 5 largest housing bubbles. In descending order of real growth, they are:

1. Israel

2. Norway

3. Switzerland

4. Canada

5. Germany

Not surprisingly, Canada is on the list. There is, of course, lots of talk both locally and abroad about the stability and sustainability of our housing market. Here’s what the article had to say about Canada:

"With real home price appreciation near 20 percent, Canada’s home price growth has been raising eyebrows. Bank of Canada governor Stephen Poloz doesn’t see a bubble, but others aren’t so sure. Climbing alongside housing prices have been levels of household debt, which surmounted 165 percent of income in the second quarter of 2013. (That’s not too far from where they were in the U.S. before it suffered its housing crisis.) And the Bank of Canada itself has even warned about risks posed by frothy condo sectors in big cities like Toronto. A few hedge funds, such as San Francisco-based Hyphen Partners, have even made high-profile bets on a Canadian housing bust. They haven’t paid off, yet.”

And here’s the full list of countries:

Overall, it’s not surprising to see that Canadian home prices have risen so dramatically since Q1-2009. As the US sank into deep recession (2008-2009), Canadian credit became cheap in order to stave off a recession of our own. This fuelled the housing market, which is an asset class that’s inextricably linked to financing costs.

The same thing happened in Ireland, which today sits at the bottom of the above list. It has seen real prices drop roughly 40% since Q1-2009. By adopting the euro currency, Ireland no longer had control over its own monetary policy (this is one of the downfalls of a centralized currency). So when the economies of the larger continental countries stuttered, interest rates were dropped. For the strong Irish economy, it ended up creating a housing bubble.

I worked in Ireland in the summer of 2007 and I remember people telling me about this. Already at this point there was concern that the market had become overheated. There are obvious parallels to what has happened in Canada, even though we don’t share a common currency. The Canadian and US economies are inextricably linked.

So will the same thing that happened to Ireland happen here in Canada? Nobody knows for sure, but I think we can take comfort in the actions taken by the feds to tighten up lending. They’re acutely aware of what easy credit has done to the housing market and they’re trying to temper it. And it’s certainly had an impact.

Early this week when I was on the panel about investing in condominiums, I asked a lot of the realtors about what they were seeing in the residential marketplace. A great number of them told me that their clients were struggling to obtain financing. A lot of deals were falling through because of it.

If you’re worried about our housing market, this should be taken as great news. Choke off credit and you choke off real estate.