Real estate developers are speeding up their expansion into smaller Ontario cities and semi-rural areas, signaling the next wave of investment in housing in a country struggling with a shortage of affordable places to live.

They are making inroads into vacation spots like Niagara, Wasaga Beach and Collingwood, as well as ramping up high-rise condo development in smaller cities like Hamilton, Guelph, Ancaster, St. Catharines and Waterloo.

Driving the push into these so-called secondary and tertiary markets are changes in how and where people work that were brought about by the pandemic’s stay-at-home mandates. More employees are allowed to do their jobs remotely, spurring demand for houses with room for home offices in the suburbs and beyond.

That has given developers an additional incentive to scoop up vacant land outside of major urban centers. The belief is that small towns will continue to grow in population, and demand will rise for all types of housing, including smaller and relatively cheaper types like condos.

Developers had already been buying in the suburbs with the knowledge that housing would be needed owing to high levels of immigration and investor demand.

Over the first two years of the pandemic, developers’ acquisitions of vacant land quintupled in Wasaga Beach; nearly tripled in Waterloo and Caledon; and doubled in Collingwood and Hamilton, according to Altus Group, a commercial real estate data firm. In Guelph and Niagara-on-the-Lake, the number of land purchases rose by 40 to 50 per cent over the same period.

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