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Canada to ban foreigners from buying homes

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Re: Canada to ban foreigners from buying homes

#651

Post by philliphaydon »

LAC-Tech wrote: post #650
philliphaydon wrote: post #642

Earlier quoted context omitted.

They couldn’t exclude Australia and Singapore due to existing trade agreements. Having lived in singapore for 10 years tho people there seem far more interested in moving to australia to live.

I'm not talking about what the justifications are. I'm talking about how the media decided it was a 'foreign buyer ban' despite very obviously not being one.

I don’t see how it’s not? Just because 2 countries couldn’t be included in the ban due to trade agreements doesn’t change the fact people can no longer go on a website and buy a house in nz without ever setting foot in the country.

Re: Canada to ban foreigners from buying homes

#652

Post by maxsilver »

CountSessine wrote: post #573
kbenson wrote: post #538

Earlier quoted context omitted.

You pick your battles, as perfect is the enemy of good. That other problems exist is not a valid reason to prevent fixing something if that fix actually helps in some way.

That other problems exist is not a valid reason to prevent fixing something if that fix actually helps in some way That scarcity exists is the whole reason we're focusing on foreign buyers in 2022. And blind-bidding in 2021. And investors in 2019. And money-laundering in 2018. And Chinese money in 2017. All of these things should be addressed, but every one of them has provided political cover for the real reason tha…

> the real reason that housing is so expensive in popular cities, which is scarcity.

This isn't really true though. Housing is expensive everywhere, even in unpopular cities, even in cities losing population. (Except for a few specific cities), housing is not scarce, we just pretend it is because we pretend all these fake financial transactions count as valid 'demand'.

> we're focusing on foreign buyers in 2022. And blind-bidding in 2021. And investors in 2019. And money-laundering in 2018. And Chinese money in 2017. All of these things should be addressed, but every one of them has provided political cover for the real reason that housing is so expensive in popular cities, which is scarcity

And why is housing "scarce"? Because we waste housing on fake buyers (every single thing you just mentioned). That's why it's all in focus so much.

My midwestern city has built 2x to 3x more housing units than it's received in new residents, for almost 15 years straight now, and housing still goes up 15% each year like clockwork. You can outbuild new resident growth (many places already do), but you can never outbuild investor demand while housing is federally forced to appreciate like this.

I'm so sick of people bullsh*tting that 'zoning' and 'nimbys' are why housing is expensive, when we have dozens of major cities with no meaningful zoning restrictions, no 'nimbys', and no restrictions on growth or construction of any kind -- and even in these cities, housing is shit and expensive.

Re: Canada to ban foreigners from buying homes

#653

Post by manbackharry »

imtringued wrote: post #474
manbackharry wrote: post #325

Earlier quoted context omitted.

Your last line is pretty much my exact opinion. I'm an idiot, but I struggle to see how significant taxes (and I mean SIGNIFICANT - something like having all rental income and cap gains on secondary residences taxed at the highest rate ~54%) in these cases wouldn't have extremely broad appeal. Make the sector unappealing as an investment class and you should stop seeing unfettered speculation. The idea of housing bei…

Rent control doesn't work because of liquidity preference. Rental income must exceed the liquidity premium of land or else it will be kept empty. Liquidity preference is effectively the concept that people prefer keeping assets exchangeable for other assets. For real estate this means keeping the property ready to sell at any time. It is easier to exchange an empty apartment and even easier to exchange an empty plot…

> ...or a sufficiently high tax on owned land (so that waiting and doing nothing has opportunity costs).

For non-primary residences? Sounds pretty good to me!

Re: Canada to ban foreigners from buying homes

#654

Post by ehsankia »

gorjusborg wrote: post #79
incomingpain wrote: post #61

The data is public, less than 5% of homes are going to foreigners. Don't see how they even accomplish banning foreigners when there are free trade and free investment agreements. The problem is that bonds have negative yields. Retirement funds are forced into buying real estate, because housing is a safe investment right? The federal government knows this and knows they can't do anything. If they targeted retirement…

I don't know how real estate market works in Canada, but I can totally see how 5% of buyers could mess up the market in the U.S.. House pricing is set based on 'comps' (comparable homes and the price they sold for). That means that a small percentage of buyers can essentially bump (initial) pricing for all homes.

The problems of the housing market is the exact same as any other expensive city in the US or anywhere else. Home-owners with local power messing with zoning laws to limit supply and boost the price of their homes. It's always a supply issue.

https://www.youtube.com/watch?v=6OZJClSdZ28

Re: Canada to ban foreigners from buying homes

#655

Post by arcticbull »

CountSessine wrote: post #174
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…

You're fighting scarcity. You still won't win the bidding war - it just won't be as one-sided. 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. While yo…

Canada's immigration rate isn't "crazy high" it's been an average of 1% per year for the last 100 years. It's standard. What's not standard is limiting new construction.

Re: Canada to ban foreigners from buying homes

#656

Post by chaostheory »

throwaway2037 wrote: post #637
chaostheory wrote: post #556

Earlier quoted context omitted.

> Regarding the violence and antisocial behaviour, that's really a problem of policing and allocation of funding. Japan has one of the lowest crime rates in the world with heavy investment in public transportation & policing, and yet they still have issues with sexual harassment and sexual assault on their trains. It’s a hard problem to fix related to population density.

Are you aware that many Tokyo train lines have women-only cars during rush hour? I think they started in the 1990s and have greatly improved the situation for women in Tokyo.

That makes things even worse. If a women can't fit in that car and goes into a normal car, there are POS who can now justify sexually assaulting them. Cracking down on the crime and publicly humiliating the perpetrators would be far better for society.

Re: Canada to ban foreigners from buying homes

#657

Post by ehsankia »

msie wrote: post #78
incomingpain wrote: post #61

The data is public, less than 5% of homes are going to foreigners. Don't see how they even accomplish banning foreigners when there are free trade and free investment agreements. The problem is that bonds have negative yields. Retirement funds are forced into buying real estate, because housing is a safe investment right? The federal government knows this and knows they can't do anything. If they targeted retirement…

It's amazing to me how some people are so entrenched in believing that foreigners are to blame that they will perform such mental gymnastics. The Myth of 1.3 Million Vacant Investor Homes in Canada: https://www.youtube.com/watch?v=evYOhpjMql0&t=6s

Another great video, with a quick reference to Oh The Urbanity

https://youtu.be/6OZJClSdZ28

Re: Canada to ban foreigners from buying homes

#658

Post by I-M-S »

rootusrootus wrote: post #344
dionidium wrote: post #245

Earlier quoted context omitted.

Yes, but crucially it's actually land that's valuable, not the housing that sits on it. The worry that allowing more density will tank home values is misguided. Land prices will keep going up as long as the land underneath the houses remains desirable. In fact, upzoning means more allowed uses, which means higher land values, which means more money for landowners. There are two implications of this: 1) NIMBYs need to…

> 2) YIMBYs need to realize that NIMBYs aren't exclusively motivated by greed. When they tell you that they don't want their neighborhood to densify they actually mean it. It's not covering for racism or greed. People genuinely don't want their neighborhoods to change. In my experience this is almost 100% the real truth. I haven't met many people that are looking at their house price when they think about changes to…

How does classicism differ from racism? The fact a neighbourhood association would welcome a Black cardiologist but not a white barista doesn't make it any less nefarious.

Re: Canada to ban foreigners from buying homes

#659

Post by refurb »

glouwbug wrote: post #178
arcticbull wrote: post #131

Earlier quoted context omitted.

Yeah, about 70% of Canadians are homeowners (almost 15% higher homeownership rate than in the US). Ideally, they find a way to keep home price growth at/below inflation for a few years rather than actually pulling prices down directly. There's very little appetite for reducing the notional price since that 70% is broadly "most voters."

Doesn't the 70% ownership stat include those living with their parents? I have friends at 30 who still live with their parents.

Google Statistic Canada data which breaks it down by age group.

Every age group, including the youngest (18-25) have a higher rate of home ownership than 20 years ago.

Re: Canada to ban foreigners from buying homes

#660

Post by davidw »

arthurofbabylon wrote: post #530
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…

Ironically, that quoted excerpt inserted its own "convenient boogeyman" of housing undersupply caused by local opposition. Also, institutional investors do have a reputation for inciting bubbles and that possibility absolutely needs to be carefully scrutinized, particularly for something as essential and socially compounding as housing.

It's not "convenient" though. People desperately want to believe that there is some remote "other" that is causing the problems, not their otherwise kind, friendly neighbors.

And yet, at every hearing I've attended about housing, ever public comment period for a project, it is my "neighbors" opposing the homes. The editorials in the local paper about how re-legalizing fourplexes would lead to (I'm paraphrasing) "those people" living in your neighborhood are not from wall street bankers, they're from people I've met who live here.

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