What does your area grocer say about your neighbourhood, its real estate values and the type of homes that define your community?
At the corner of Bathurst and Fleet in downtown Toronto, a derelict heritage building – and former warehouse and head office of Loblaws – sticks out like a sore thumb among its more contemporary high-rise neighbours. However, much to the satisfaction of condo-dwellers in the Fort York area, that is all set to change soon.
A major redevelopment project that will see the 7-storey art-deco building, which dates back to 1928, undergo a major facelift is already in the works. With a planned 2019 end date, the heritage structure will transform into a major residential and office complex, that will also feature a new Loblaws Grocery store likely mirroring that of the supermarket chain’s upscale flagship at Maple Leaf Gardens.
“I’m super excited,” said Daniel, a resident of the area. “Convenience aside, that’s got to have a great impact on resale values.”
That got us at TheRedPin eager to dig deeper and run an observational study of how grocery stores and real estate values correlate. We decided to pit the more upscale Loblaws chain to its budget-conscious counterpart, No Frills.
After digging at two years of housing data, which included over 9,000 house and condo sales, we studied real estate prices in walking distance of a total of 16 of the most and least popular grocery outlets among shoppers in Toronto, as gathered by the foodie experts at BlogTO (Map of outlets can be found below).
- There are an estimated 134%* more condos within walking distance of Loblaws vs No Frills
- Average price of a condo around Loblaws is $472,657 – 13.7% higher than No Frills locations ($415,684)
- Average price of detached properties around No Frills is $955,953, significantly less than houses at Loblaws locations – $1,526,006
- Study is based on select 16 locations across the City of Toronto
The first fact that stuck out to us is just how much more Loblaws is geared toward urbanites and condo-dwellers. From the select stores we studied, we found 134 per cent more condo apartments sold in walking distance of Loblaws versus No Frills since the year 2014. There are exceptions, however, namely the No Frills located at 200 Front Street East, an established condo hub.
Condo values also significantly vary for each grocer. High-rise apartments around Loblaws sold for an average of $472,657, 13.7 per cent higher than units around No Frills, which averaged $415,684.
It’s worth noting, however, condos that put residents in walking distance of No Frills still came ahead of the Toronto city-wide average of $396,419 for the same two-year time frame.
When it comes to freehold properties, No Frills unsurprisingly beats out Loblaws in terms of the overall number of single-family home sales.
There were an estimated two freehold properties sold around No Frills for everyone one around Loblaws,* with 1,595 home sales versus 782. Between the two grocers, the price gap is far more substantial for single-family detached homes versus condos, with the average selling price of low-rise houses around Loblaws ($1,526,006) seeing a significant markup over houses near No Frills ($955,953).
View Loblaws vs No Frills in a full screen map
Prices reflect averages for 2015-2014.
The question of how grocery stores, and more specifically what brand of grocers, impact home values has been one repeatedly tapped. U.S. based RealtyTrac found homes around Trader Joe’s were valued an average of 5 per cent more than residences anchored around a WholeFoods.
Zillow famously found the Starbucks effect, where homes within a quarter-mile of a Starbuck rose by 96 per cent over a 16 year time-period, compared to 65 per cent for all homes across the United States.
In our honed-down study, we found condos within a 10 minutes walk of Loblaws increased by an average of 4.8 per cent year-over-year between 2015 and 2014, whereas condos around No Frills overall remained relatively stagnant. Yet, it’s important to note the Loblaws locations are far more central.
When it comes to coveted freeholds, Toronto houses anchoring Loblaws saw a double-digit price increase of 11.2 per cent from 2014 to 2015. That figure just edges ahead of the 11 per cent increase for homes in walking distance of No Frills, truly testifying to the strength of the freehold market within the bounds of the 416.
Want to get started on your home buying and selling journey? Give us a call at (416) 800-0812 and check out our listing page – which carries the largest database of resale and pre-construction homes in the GTA.
- Figures accessed from TREB Stratus System
Average prices reflect 2 year period spanning 2015 to 2014
Figures based on select 16 most and least grocer outlets as listed by BlogTO