Here's an interesting figure from the Missing Middle Initiative showing the change in population of 0-4 year olds in Southern Ontario between 2016 and 2021:

What this shows is that the population of young children declined in the Greater Toronto Area and in Ottawa, but increased dramatically in areas further out, such as in Lanark County (outside of Ottawa) and Oxford County (between London and Hamilton). If you know what home prices are like in Southern Ontario, then this probably makes intuitive sense to you. Families are, as the old saying goes, "driving until they qualify."

But let's look at the data more closely. What the Missing Middle uncovered was that the metric most highly correlated with the population growth of children under the age of 5 was the increase in the supply of housing with three or more bedrooms. More specifically, though, it was highly correlated with an increase in the number of larger owner-occupied homes. Rental housing did not have the same correlation.

They go on to remind us that correlation is not causation, which is true. But regardless, there's a clear recipe here: If cities want to become more family-friendly, house more young children, and not lose them to exurban areas, then they need to figure out a way to unlock more 3-bedroom homes at price points that more families can afford.

Note: As is typical on this blog, I am using the term home to include all housing types, not just single-family housing. A home is not a housing type. It is simply a place where people, families, and households live permanently. Associating the term home with only single-family housing creates a cultural bias that I believe is suboptimal for cities.

Most global cities now have restrictions, and in some cases an effective ban, on short-term rentals. Here are some examples, along with their annual nightly rental cap as I understand them (and by this, I mean what ChatGPT is telling me):

• Berlin: Secondary residence rentals are limited to 90 days per year

• London: Annual cap of 90 nights

• Mexico City: Annual cap of 180 nights

• New York City: Only host-present stays allowed

• Paris: Annual cap of 120 nights

• Rio de Janeiro: Annual cap of 90 nights

• San Francisco: Annual cap of 90 nights

• Singapore: Minimum stay of 3 months for private properties and 6 months for HDB properties (Singapore's public housing authority)

• Sydney: Annual cap of 180 nights

• Toronto: Annual cap of 180 nights

These rules and caps will have nuances to them. Like if you want to rent your place on the third Tuesday of a month and your property faces west and has a view of an outdoor terrace with no more than 6 brass bistro tables, you probably require a special license. Okay, this isn't true. But broadly speaking, most cities now have strict caps in the range of 90-180 nights and differentiate between whole-home rentals and host-present stays.

What this, of course, means is that most big cities don't want people operating short-term rentals as a business. They'd like hosts to be people who maybe rent out their place while they're away on vacation and/or offer up an extra room when some conference or event is taking place in town. In other words, cities do not want short-term rentals to negatively impact their supply of long-term rentals.

Here's an interesting figure from the Missing Middle Initiative showing the change in population of 0-4 year olds in Southern Ontario between 2016 and 2021:

What this shows is that the population of young children declined in the Greater Toronto Area and in Ottawa, but increased dramatically in areas further out, such as in Lanark County (outside of Ottawa) and Oxford County (between London and Hamilton). If you know what home prices are like in Southern Ontario, then this probably makes intuitive sense to you. Families are, as the old saying goes, "driving until they qualify."

But let's look at the data more closely. What the Missing Middle uncovered was that the metric most highly correlated with the population growth of children under the age of 5 was the increase in the supply of housing with three or more bedrooms. More specifically, though, it was highly correlated with an increase in the number of larger owner-occupied homes. Rental housing did not have the same correlation.

They go on to remind us that correlation is not causation, which is true. But regardless, there's a clear recipe here: If cities want to become more family-friendly, house more young children, and not lose them to exurban areas, then they need to figure out a way to unlock more 3-bedroom homes at price points that more families can afford.

Note: As is typical on this blog, I am using the term home to include all housing types, not just single-family housing. A home is not a housing type. It is simply a place where people, families, and households live permanently. Associating the term home with only single-family housing creates a cultural bias that I believe is suboptimal for cities.

Most global cities now have restrictions, and in some cases an effective ban, on short-term rentals. Here are some examples, along with their annual nightly rental cap as I understand them (and by this, I mean what ChatGPT is telling me):

• Berlin: Secondary residence rentals are limited to 90 days per year

• London: Annual cap of 90 nights

• Mexico City: Annual cap of 180 nights

• New York City: Only host-present stays allowed

• Paris: Annual cap of 120 nights

• Rio de Janeiro: Annual cap of 90 nights

• San Francisco: Annual cap of 90 nights

• Singapore: Minimum stay of 3 months for private properties and 6 months for HDB properties (Singapore's public housing authority)

• Sydney: Annual cap of 180 nights

• Toronto: Annual cap of 180 nights

These rules and caps will have nuances to them. Like if you want to rent your place on the third Tuesday of a month and your property faces west and has a view of an outdoor terrace with no more than 6 brass bistro tables, you probably require a special license. Okay, this isn't true. But broadly speaking, most cities now have strict caps in the range of 90-180 nights and differentiate between whole-home rentals and host-present stays.

What this, of course, means is that most big cities don't want people operating short-term rentals as a business. They'd like hosts to be people who maybe rent out their place while they're away on vacation and/or offer up an extra room when some conference or event is taking place in town. In other words, cities do not want short-term rentals to negatively impact their supply of long-term rentals.