The big picture

Many new transit stations are located in neighbourhoods that have concentrations of lower-income residents. [1] New transit lines can improve mobility and accessibility to destinations while lowering greenhouse gas emissions, particularly when paired with the intensification of land surrounding stations. However, these accessibility improvements can have unintended consequences if rising rents and housing values force the most vulnerable residents to leave. This study examines patterns of residential displacement and exclusion following the opening of new transit stations in Canadian cities, with a focus on impacts on low-income residents.

Methodology and approach

Residential displacement is a situation in which current residents are forced out of neighbourhoods or have fewer options within them.

This may be direct displacement (when housing is demolished for new transit construction), but is most often indirect displacement, when property prices and rents increase without policy protections. Along with these, researchers also consider exclusionary displacement, when new residents are unable to move into neighbourhoods because of price increases or a lack of suitable housing stock. [2]

To measure displacement around transit stations, first we identified every major rail transit station that opened in Canada between 1990 and 2016, including subway/metro, light rail transit (LRT), and regional rail. For these 70 station areas, we used historical census data to understand how many and what types of dwellings were built within 800 metres of the station over a 10-year period, the five years before and after the stations opened. [3]

Historical analysis

We used the Longitudinal Administrative Databank (LAD) to track how many low-income residents moved in and out of transit station areas. The LAD is a 20% annual sample dataset of tax filers across Canada and includes the postal code of each household alongside tax-filing information. [4] We mapped changes in postal codes to analyze whether residents moved in or out of station areas over the 10-year period, and compared these moving rates with moving rates in each station’s Census Metropolitan Area (CMA) for the same period. Since our analysis focuses on low-income residents, we used the Low-Income Measure variable within the LAD dataset to measure the movements of this population.

We used this historical data to create a statistical model that estimates the likelihood of residents to move away from a transit station area based on their individual demographic and socioeconomic characteristics as well as changes in the built environment (e.g. building mixed-use developments or a larger number of two- and three-bedroom units).

Case study scenario analysis

We applied our statistical model to 15 hypothetical scenarios across the five TOD case study areas we identified for this project (Arbutus in Vancouver, Cooksville in Mississauga, McKernan-Belgravia in Edmonton, Northfield in Waterloo, and Panama in Brossard) to measure the potential impact on low-income resident mobility. For each case we examined what would occur with:

• no new development
• the current development trajectory
• optimized development of complete communities

What we found

Studying the movements of low-income residents allowed us to draw some broad conclusions about station areas across the country. If low-income residents moved out of station areas at above-average rates relative to the metro, this signalled displacement. If they moved out at similar or below-average rates, this indicated that the area was remaining relatively affordable. We determined the relative inclusivity or exclusivity of new station areas by measuring the rates of low-income residents moving in. We found a consistent overall pattern of heightened displacement and reduced in-migration over the 1990-2016 period. These trends persisted in our forward-looking scenario analysis of case study station areas.

Lower-income residents are more likely to leave new station areas

Between 1990 and 2016, low-income residents were about 10% more likely to leave neighbourhoods with a new transit station than comparable areas in the same CMA without one. This trend has increased in recent years (since 2010) and is more pronounced in areas with new subway stations versus LRT or regional rail.

When measured as part of a multivariate analysis, income was by far the most important predictor of moving out of a station area. Other demographic variables like age, gender, and family composition all showed more minor effects.

New station areas are more exclusive than other neighbourhoods

Where new stations have opened, the residents who move into the station area are about 15% less likely to be low-income compared with those relocating to other parts of the CMA. This was particularly true in the major cities of Montreal, Vancouver, and Toronto, where much of the new housing built near transit stations since 2000 has been owner-occupied condominiums, which are generally less accessible to lower-income households. In contrast, there were more low-income in-movers near LRT stations, possibly because these have less of an impact on land values and housing prices, at least in the context of Edmonton and Calgary. More recent station openings have also attracted more low-income households, at rates comparable to the rest of the CMA. This may be tied to local market conditions or may be a positive effect of more inclusive housing policies in these areas.

All new development in case study station areas is associated with displacement – but mixed-use areas fare better

Across the five case studies, development was associated with higher levels of displacement for low-income households than for other residents – regardless of what type of dwellings were built (number of bedrooms, number of stories, etc.). More significant policy interventions are required to ensure these areas remain affordable so households can stay in place.

In our simulated scenarios, low-income households were about 5% more likely to move away than residents who were not low-income. Turnover of the low-income population ranged between 7% and 9% per year in these areas, compared to 6 to 8% without any new development. The optimized scenarios, which in each case included more intentional mixed-use development and a greater mix of dwelling types, often resulted in less out-migration of low-income households. However, nearly all cases showed more displacement from new development, indicating that policies must explicitly address displacement risk in these areas.

Key conclusions and policy recommendations

We find that, on average, when new transit stations open in Canada, low-income residents are more likely to be displaced and station areas tend to become more exclusive than before. While these outcomes vary by city and by transit system type, a consistent national pattern emerges: low-income residents are 10% more likely to move out of station areas, and 15% less likely to move in. Mixed-use development shows some potential to temper these effects, but policy intervention is needed in addition to changes in built form.

Integrating a greater mix of uses and dwelling types within station areas, as in the optimized case study scenarios, was linked with lower out-migration of low-income households. Ensuring residents have options at varying sizes, numbers of bedrooms, and affordability levels can allow them to stay within the area, and present options to a greater number of potential in-movers. However, mixing dwelling types is insufficient to mitigate displacement.

While diversifying development is helpful, municipalities must establish intentional policy interventions to prevent displacement from station areas. These include efforts to preserve existing affordable housing and to require, incentivize, or directly support the construction of new affordable units within station areas. Without these interventions, new development near transit is likely to continue contributing to displacement, even in mixed-use contexts.

In addition to policy protections, municipalities should guide the type of housing delivered in station areas. Favouring purpose-built rental over condominium development can provide more stable, long-term housing options for low- and moderate-income households. Condominiums are more likely to drive price increases and limit access for lower-income residents.