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Billions in 'unknown' funds flowing into Canada's housing market [video]

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Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#111

Post by wuschel »

cheesecake_luvr wrote: post #54
teruakohatu wrote: post #17

New Zealand has a similar housing problem. House prices are skyrocketing and pricing out young people. A 25-30% rise in the past year has meant few people are saving fast enough to get a deposit. But two or three years ago the govt. banned overseas buyers. There is no reason to suggest the ban is not effective. It even bans non-permanent residents, so plenty of legitimate residents (work visas) can't purchase propert…

Overseas buyers just get permanent residency and citizenship and buy houses. A few years ago you just needed ~$NZ5m invested in the country and you get permanent residency. There is no way the prices are driven by domestic money. My factory supervisor brother has a house in Mangere Bridge, a blue-collar suburb, built for ~$100k 20 years ago is now well over $1m. It is batshit crazy. I hear of eye-watering prices in M…

Let us assume it is not overseas buyers - what factors are left? Is it just access to cheap credit that drives investment into the housing market all over the globe?

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#112

Post by Apocryphon »

bookofsand wrote: post #84
fastball wrote: post #25

Earlier quoted context omitted.

In Indonesia, only citizens or businesses with part ownership by citizens are allowed to own property, and I think this is probably the right way to go for most other countries as well. Unlike the vast majority of other human endeavors, land actually is a zero sum game, at least until we are a space-faring species.

Even if we become a space faring species, land will still be a zero sum game. * Within the Solar System the amount of land available on bodies with not-crushing-gravity is limited to a few times the Earth surface. This includes hospitable bodies like Venus, Titan or the Moon. The entire area of Mars is slightly smaller than Earth's land area, with climate conditions significantly worse than Antarctica. Sobering map:…

Just build orbital colonies.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#113

Post by TedDoesntTalk »

petre wrote: post #93
eurasiantiger wrote: post #74

Earlier quoted context omitted.

Yes. Those people buy multiple properties in an effort to launder their drug money. Just look at the situation in Marbella.

You probably mean this? https://www.theguardian.com/news/2021/may/20/a-united-nation...

That’s a great read. Thank you. I was in Marbella in the 1990s, in awe of the ostentatious wealth, but had no idea it was from drug trafficking.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#114

Post by CTDOCodebases »

exporectomy wrote: post #21
sunstone wrote: post #11

Earlier quoted context omitted.

In Australia if I recall correctly, foreign buyers are only able to buy newly built homes. Canada would benefit from a similar rule, it would stimulate more housing and not impact the demand for existing homes.

Isn't the problem in Australia (and New Zealand) mainly caused by first home buyers? They seem to pay the maximum the bank will lend them with no regard for being profitable or a good investment. Just get the best house possible at any cost. Once they own them, they fill them with lower occupancy than investors do, so the supply of housing effectively decreases. I'm one of those people. My house used to be a rental w…

The problem is caused by a whole number of factors that incentivise people to buy houses they won’t live in.

Housing in Sydney is becoming a self fulfilling prophecy. The more people spend on it the more it’s value increases hence attracting more investors who drive prices up.

In order for this to stop the majority of the public will need to find this whole situation unacceptable.

I find it absurd that citizens from countries that disallow Australians to buy property can buy residential property here in Sydney. Apparently helping foreign citizens to avoid taxation/capital controls while propping up the construction/banking sector is more important than looking after the average citizens best interests.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#115

Post by Cyril_HN »

teruakohatu wrote: post #17

New Zealand has a similar housing problem. House prices are skyrocketing and pricing out young people. A 25-30% rise in the past year has meant few people are saving fast enough to get a deposit. But two or three years ago the govt. banned overseas buyers. There is no reason to suggest the ban is not effective. It even bans non-permanent residents, so plenty of legitimate residents (work visas) can't purchase propert…

I believe something like a million kiwis live abroad. It strikes me that one mechanism is:

- Kiwis live and work abroad, sometimes earning much more than they would in NZ.

- Those kiwis buy houses.

And with the pandemic:

- More of those kiwis have decided to buy houses in NZ, because it has been very successful at keeping covid and restrictions minimal so far.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#116

Post by digislave »

wuschel wrote: post #111
cheesecake_luvr wrote: post #54

Earlier quoted context omitted.

Overseas buyers just get permanent residency and citizenship and buy houses. A few years ago you just needed ~$NZ5m invested in the country and you get permanent residency. There is no way the prices are driven by domestic money. My factory supervisor brother has a house in Mangere Bridge, a blue-collar suburb, built for ~$100k 20 years ago is now well over $1m. It is batshit crazy. I hear of eye-watering prices in M…

Let us assume it is not overseas buyers - what factors are left? Is it just access to cheap credit that drives investment into the housing market all over the globe?

Why not? It seems obvious that cheap credit would drive up prices. For example people could just be bidding up to what they can pay off in about 30 years. If they simply do that, cheaper credit would rise house prices.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#117

Post by onion2k »

seanmcdirmid wrote: post #103
spfzero wrote: post #63

Earlier quoted context omitted.

Western real estate is the new gold. It's protected by the entrenched lawful property rights of western countries, so money made in countries without those rights are going to flow in. Think about it. If you had made a few million based on your having positional power in a country where you would be jailed or killed once people found out what you had been doing, you'd get the money out to somewhere your descendants w…

> Western real estate is the new gold. If you think western real estate is nuts, Chinese real estate is even crazier. Those Wenzhou house wives supposedly got started locally moving onto the rest of China and now the western world. It’s probably way more complex than that, however. > If you had made a few million based on your having positional power in a country where you would be jailed or killed once people found…

then Chinese would be fleeing the Chinese real estate market for the west, which isn’t really happening

This is basic diversification. No one would expect them to flee the local market while it's still working, but buying some assets in foreign cities protects against the Chinese government cracking down on people owning multiple homes in the local market. It's quite sensible really.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#118

Post by Gatsky »

teruakohatu wrote: post #17

New Zealand has a similar housing problem. House prices are skyrocketing and pricing out young people. A 25-30% rise in the past year has meant few people are saving fast enough to get a deposit. But two or three years ago the govt. banned overseas buyers. There is no reason to suggest the ban is not effective. It even bans non-permanent residents, so plenty of legitimate residents (work visas) can't purchase propert…

Just to add that in Australia the housing market is also going nuts and presumably foreign buyers are suppressed or absent due to Covid.

It is really quite bad, and nobody knows what to do about it. It is lose-lose now because there are the people who can't buy a house, and then there are those who sacrificed everything to buy a house. You can't help one group without really hurting the other. It will really hit home when the people who can't buy a house get older, and stop work.

Two options come to mind:

- Adjust policy to slow the rate of increase such that wages and income will catch up. This will take 20 years or more of course, resulting in an 'unhoused' generation of people.

- Make some kind of large structural change which reduces prices coupled with debt forgiveness. This will still screw a lot of overcapitalised people.

I don't think massively increasing urban density will work in Australia (or NZ, or Canada), which seems to be the Japanese solution.

A third option is to try and reduce concentration in major cities, and attract people to regional areas where housing supply and demand are better matched and prices are much lower. There is actually an opportunity to do this because of Covid - more interest in remove work and less migration. Austrlia, NZ and Canada have a lot space after all.

But the reality is, our listless government won't do anything, and the political pressure from the older well-housed generations protecting their wealth is too great.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#119

Post by digislave »

tolbish wrote: post #3

Should housing be a primary vehicle for investment and the de facto way of making money? Or should it serve as a necessity and basic aspect of life?

People can only ask for as much money for houses as people are prepared to pay. It isn't true that speculators can simply drive the price up as high as they want.

If investing in housing is a good way to make money, it is an incentive to build more housing.

Even foreign money could be good. If foreigners pour lots of money into your housing market, you could build lots of cheap houses and sell it to them for lots of money, for example. (not saying you should, just saying foreign investment in housing is not automatically a net loss).

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