Schools close primarily because of demographic changes, mostly aging...they were overbuilt in the 50s-80s at a time when the neighbourhood unit school with like 200 kids was trendy and when the area grows up, the kids leave quite suddenly. Only when the retirees and widows leave years later can enrollment climb back up. Affordability isn't really a big deal. Newer schools or rebuilt schools are invariably much larger, usually with space for 400+ kids.
That map makes areas look worse off than they really are. If a single school has enrollment problems - and a single school can serve literally a few crescents of houses - adjacent schools will also be slated for consolidation because they're the ones that will absorb the kids. The map indicates about 8 schools across the entire city with enrollment problems, a pretty trivial number, but includes like 30 because closures affect multiple schools.
The TDSB/TCDSB divide makes things thougher. If, say, Italian people leave an area and are replaced by Portuguese and Philippino people, the Catholic schools will stay afloat. If they're replaced by non-Catholics, though, the TDSB schools will become overcrowded and the TCDSB schools will be in trouble. If replaced by no kids at all, both boards have problems. Both Toronto boards use very minimal bussing and rely on compact local areas to feed their schools. Between renovations necessary to consolidate school bodies and possible bus expenses, closing schools won't net the boards much money. Many sites will need to be kept to counter future population increases and demographic change, to be used as temporary schools during construction, to be used for storage, to be leased out to private schools, etc. They're sitting on a gold mine of real estate but they can't mine much of the gold.
As for housing, 3+ bedroom condos would be great are either rarely built or would require buying and merging two units. Either way, not cheap. Townhouses are ideal but are only built with extreme luxury in mind...new townhouses never seem to be offered for less than 600K. Might as well move to Markham or Milton. People want houses not just because of the backyards but because of the space, literally, between houses. This seems silly to many people of our generation, where 3 or more kids per household is pretty rare, but our parents came from larger households, where 3+ kids was normal. How many kids these days share a bedroom with someone else? These days there's less real impulses to crave space for the sake of space and breathing room and privacy, but inertia is strong, especially when reinforced by the media and culture and family. There's amazingly few pop culture examples of happy families living in apartments...Sesame Street...and, err...hmm.