Several years ago, when I was on the speaking circuit helping small and mid-sized cities, I argued that the cost of housing and the quality of life issues in some of Canada's largest cities would drive some residents to depart and seek a better life in smaller cities.

The evidence today is clear—that is exactly what is happening. Toronto lost 40,000 residents last year. Peel Region even more: 45,000. Montreal and Vancouver both had more outmigration than arrivals.

Some people leaving are seniors who have realized they can sell their house for big bucks, move to a small or mid-sized city, buy a nice house and end up with cash in their pockets.

However, the largest cohort to leave are young families. The cost of housing, the commuting, the concerns about anything from safety to the prices of goods and services are driving them out.

This has serious implications for both sizes of cities. In larger centres, they may lose a seat in Parliament as the population declines, as happened in Toronto. The local tax base will be affected. Housing prices may slide—Toronto is down about 14% in the past year. Neighbourhoods can be changed.

In the mid and small cities gaining residents, they may have been unprepared for the sudden influx. Often, they don't have sufficient housing for the surge, so cities scramble to get land serviced and new houses constructed. Housing prices will likely jump.

The second challenge of this migration is the multiple new demands of local government. Transportation corridors may not be designed to handle robust new traffic flows. There must be sufficient school rooms and teachers to accommodate these new young families and their kids. Hospitals, doctors, and healthcare facilities must be able to respond to the growing needs. Libraries, parks and playgrounds will have new demands. More police and fire services will be necessary.

These needs will change that city's operating budget. While the additional revenue will be welcome, additional new costs will spike. The population influx certainly will also make new demands on the capital budget. Timing of some projects may be changed because of these new development requirements.

Cities are changing constantly; they are in competition to retain or attract these families, to grow and prosper. The communities that have a vibrant downtown, attractive neighbourhoods and offer a great quality of life will do very well in the migration sweepstakes.