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Canada to ban foreigners from buying homes

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Re: Canada to ban foreigners from buying homes

#291

Post by ceeplusplus »

llbeansandrice wrote: post #226
davidw wrote: post #140

Earlier quoted context omitted.

> massive investments made by hedge funds, private capital, REITs I can't recommend this article enough on that subject: https://www.vox.com/22524829/wall-street-housing-market-blac... "The role of institutional investors is still being studied, but the popularity of the narrative strikes at something dangerous: People want a convenient boogeyman and when they get it, they often ignore the structural problems that ar…

I feel like both of these things can be problems. If you view housing and ownership of your domicile as something that should be accessible to people, then housing necessarily cannot be viewed as an investment vehicle and large corporations, REITs, wallstreet, etc. need to be excluded so that more supply can be available to "correct" buyers. Limiting these groups does help on the supply-side. While it may not be the…

REITs are not buying million dollar homes in Vancouver to rent out. None of the real estate hotspots where you literally can't buy a home on a normal salary are caused by REITs, because those homes have terrible yields. Most REITs focus on either large, 10+ unit apartment buildings, or on cheaper houses in less appealing locations with good yields.

The real issue is that there is not enough supply in desirable locations.

Re: Canada to ban foreigners from buying homes

#292

Post by blip54321 »

ethbr0 wrote: post #118
boplicity wrote: post #88

> During last year’s election campaign, Trudeau’s party also proposed a ban on “blind bidding” for houses -- the prevailing system by which offers are kept secret when someone is auctioning a home. This is such a huge deal. Anyone who has had to go through the process of buying a home through a bidding war knows how unfair and one-sided this process is. It take a high-pressure emotional situation, and gives all of th…

As someone who recently bid in a hot property market, I'm a huge fan of common sense bans and unwaivable rights. In a competitive market, filled with buyers of questionable sophistication, i.e. residential real estate, everyone gets to the bottom of maximally-waived, minimal-safeguards pretty quickly to make a competitive offer. And ultimately, that isn't good for anyone, sellers included. Better to explicitly prohib…

It's complex. There are two sides to every equation. Buyer and seller. Sellers aren't necessarily sophisticated either. If I sell my home, and the roof is leaking and I don't know about it, I don't want to be liable down-the-road.

Peace-of-mind is worth a lot. Especially if the buyer is sophisticated, I might take a lower offer if it has the right waivers.

Re: Canada to ban foreigners from buying homes

#293

Post by CogitoCogito »

AzzieElbab wrote: post #222
FpUser wrote: post #153

Earlier quoted context omitted.

And ruin lives for everyone who did not manage to buy house when it was affordable. Fuck that. Just in case, I do own the house.

Do you have a mortgage too? Would you be happy owing the bank more than your property is worth?

Who would be happy with that? And who is happy with not being able to afford a house? What does happiness gave to do with it? You made a financial bet on buying your house for certain price. There’s always a risk in that price going down after you buy it. Sucks for you but the price going up for you just sucks for someone else.

Re: Canada to ban foreigners from buying homes

#294

Post by Beldin »

paulgb wrote: post #119
Maximus9000 wrote: post #109

Earlier quoted context omitted.

> the same is true of some of the people they're bidding against I think you're assuming that everyone bidding will be a first time home buyer under 40 years old. While that may be the bulk of buyers, there are also many investors also in the mix who are buying up houses to rent/flip them.

A house goes to the highest bidder, so if you decrease the cost of capital for some participants you increase the price for everyone. I agree that it’s not a perfect transfer, but I suspect it’s a pretty good one, on the assumption that first-time buyers represent most of the capital entering the system. E.g. someone buying a first house for $500k puts $500k in the market, whereas someone moving from a $500k house to…

They tried something like this in. nl and that was pretty much exactly what happened: make some of the cash-limited house buyers be able to pay more increased prices.

The desired effect typically is not achieved because such measures are aimed at the least affluent buyers. Giving those ways to bid more will not decrease prices. It just means someone else is now the least affluent buyer - typically not investors.

Re: Canada to ban foreigners from buying homes

#295

Post by edgyquant »

michael1999 wrote: post #282
ch4s3 wrote: post #261

Earlier quoted context omitted.

> Stop championing scarcity by blaming scapegoats. Either we limit Canada's crazy-high immigration rate (1% of population every year) or we build more homes which is mostly gated by illiberal zoning laws passed by municipalities. But both of these policies are very popular so you'll be swimming upstream, politically. I'm all for building more houses in cities/high demand areas, but doesn't Canada only have a populati…

Canada is a big country. But immigration goes where the jobs are, and those are concentrated in 3-5 large cities which are hitting the limits of sprawl (congested highway commute time) and geography (water and mountains). Densification is unpopular with existing municipal voters, and bankrupting CPP would be unpopular with federal voters.

Can they not move to nearby cities and commute?

Re: Canada to ban foreigners from buying homes

#296

Post by ceeplusplus »

mistermann wrote: post #160
tqi wrote: post #15

Earlier quoted context omitted.

> I feel like it’s almost an attempt to appease citizens by blaming the issue on “foreigners” (always a move that is popular with politicians) Yeah the Right loves to blame poor foreigners while the Left prefers to blame rich foreigners but at the end of the day they at least agree that it is never the voters themselves who are to blame.

>> I feel like it’s almost an attempt to appease citizens by blaming the issue on “foreigners” (always a move that is popular with politicians) > Yeah the Right loves to blame poor foreigners while the Left prefers to blame rich foreigners but at the end of the day they at least agree that it is never the voters themselves who are to blame. Generally speaking I think you're mostly correct, but there are exceptions, a…

We can't even get people to consistently pass basic mathematics at a college 101 level, what you're asking is impossible. There is fundamentally a culture of anti-intellectualism in many American subcultures and the left tries to paper over it by shouting about racism and the right straight up supports it.

Re: Canada to ban foreigners from buying homes

#297

Post by macspoofing »

gregable wrote: post #223
macspoofing wrote: post #163

Earlier quoted context omitted.

>This is such a huge deal. Is it though? I chatted with someone from Australia which has open bidding and you know what .. houses still went way over reserve. At the end of the day, if you have 20+ offers on a house, you're not getting that house without destroying your budget, no matter how you set up the bid system. The common sense change I wanted to see implemented was to prevent the waiving of a home inspection…

I'm not sure why "amount over reserve / list" is a meaningful metric. It's clear that in a lot of cases the list prices are intentionally below market to attract more bidders and produce the appearance of more competition at open houses and the like. It's a very manipulated and manipulable metric.

>I'm not sure why "amount over reserve / list" is a meaningful metric.

It's not. The salient part is that the current market is crazy and there is a large number of bids on any given house.

>It's clear that in a lot of cases the list prices are intentionally below market to attract more bidders and produce the appearance of more competition at open houses and the like.

Yes, list prices are intentionally below market but you know what ... houses are going for crazy amounts because we are in some sort of a bubble. This isn't the fault of blind bidding, or unscrupulous realtors or greed property owners. There are systemic economic issues at play. In my area, for example, there are houses that doubled in value in under 24 months. When I bought my property 12 years ago, there was blind bidding, and bad realtors, but on any given property there were only 2-3 bids, so there was no issue.

Re: Canada to ban foreigners from buying homes

#298

Post by qball »

Ensorceled wrote: post #142
AzzieElbab wrote: post #121

Earlier quoted context omitted.

I think people are missing the fact that for many Canadians values of their homes represent their live savings. So while homeownership remains high in Canada doing something substantial about re prices would ruin peoples lives.

We are at the point where foreign and Canadian speculation in housing is making housing totally unaffordable for the vast majority of Canadians. In a country of less than 40 million, it's pretty easy to swamp our markets. We need to take speculation out of the marketplace. I'd also like to see a ban on corporations purchasing private homes and significant tax increases on non principle residences.

>I'd also like to see a ban on corporations purchasing private homes and significant tax increases on non principle residences.

This would actually solve the problem (the calls are coming from inside the house- foreign investment is merely a scapegoat), and as such it won't be done.

Re: Canada to ban foreigners from buying homes

#299

Post by tablespoon »

thrwy_ywrht wrote: post #104
dsnr wrote: post #25

Earlier quoted context omitted.

This is not really guaranteed to solve the problem. It will only be a part of the solution. In many countries, including Europe, new properties are quickly snatched by investment companies that have much easier access to capital than private individuals and can easily afford to pay above market prices. People shouldn’t really have to compete with companies or “investors” on the housing market.

>In many countries, including Europe, new properties are quickly snatched by investment Demand for housing is not infinite, and supply of capital is not infinite. Building more units will always help. The quantity of units which are bought and then kept empty long term is tiny in relative terms.

>> In many countries, including Europe, new properties are quickly snatched by investment

> Demand for housing is not infinite, and supply of capital is not infinite. Building more units will always help. The quantity of units which are bought and then kept empty long term is tiny in relative terms.

I think it's kind of pointless to argue over which one policy to pursue to fix this problem, why not try a multi-pronged approach?

1. Implement some policy to ban large investors from home-ownership (say no corporate ownership and a small cap on how many an individual/family can own). There are more reasons to do this than just supply.

2. Put an onerous tax on housing that is not occupied full-time.

3. Build more housing.

1 & 2 would help ease some (but not all) pressure that makes 3 less desirable.

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