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Canada bans foreign home buyers for two years

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Re: Canada bans foreign home buyers for two years

#181

Post by raziel2p »

xyst wrote: post #29
j7ake wrote: post #8

I would have thought that the pandemic and travel restrictions would have effectively “banned foreigners from buying homes” for 2 years. If home prices haven’t fallen during pandemic, then the reason why prices are high is not because of foreigners. The government is trying to point to a scapegoat rather than trying to get to the root cause.

This. Root cause is crappy city planning and design; and emphasis on single family housing development. Many cities across North America are designed with urban sprawl and car centric travel in mind. Pedestrian and alternative forms of transportation are a second class citizen despite the ability to move people more efficiently than cars will ever do. Don’t get me wrong. Cars have their in place in society but their…

European cities without the problems you've mentioned are struggling with the exact same housing crisis.

Re: Canada bans foreign home buyers for two years

#182

Post by DocTomoe »

throw0101a wrote: post #112
krageon wrote: post #40

Earlier quoted context omitted.

It's not about the "economy", it's about people being able to buy a roof over their head. Foreign investors simply don't belong in that space at all.

> Foreign investors simply don't belong in that space at all. How much is this a problem? Further, this does not (IIRC) apply to folks to have permanent residence status or folks here on things like student visas. So how many never-set-foot-in-Canada people are buying properties?

I would not try to immigrate into a country in which I don't have a place to live, so this essentially is an anti-immigration, "Canada for the Canadians, Foreigners out" policy in my book.

Re: Canada bans foreign home buyers for two years

#183

Post by RocketOne »

sokoloff wrote: post #164
nameisname wrote: post #139

Earlier quoted context omitted.

This is how it works in Canada and it's absolutely toxic. I have seen Realtors push people up on price when they're the highest bid.

The Realtors are (transparently disclosed as) working for the seller. Why wouldn't they do that? It's literally their job and everyone knows it. It's certainly the case that the agent who knows that a particular bidder is the highest/most attractive offer is working for the seller.

The buyer's realtor is supposed to be working in the buyer's best interest and getting the lowest price possible. In reality it doesn't often work that way, especially when the buyer and seller realtors know each other. I just bought a house and both realtors ended up being from the same office, and are good friends. Do I honestly think I got the best price? Not likely.

Re: Canada bans foreign home buyers for two years

#184

Post by azepoi »

joelthelion wrote: post #97
tici_88 wrote: post #34

Foreigners, especially the billionaire type, can and have been setting up shell corporations through which to purchase Canadian real estate. The proposed measure will do nothing to stop this practice. The measures proposed by the Canadian government are likely just political posturing and indented to "pull the wool over the eyes" of Canadian voters because the housing bubble/crisis has reached epic proportions and ev…

Could a better thought out measure achieve the same goals? How would you do it? I feel a strong tax on houses you don't personally live in (because you rent them or because you're a company) could be efficient, but I'd love to hear other people's take on the subject.

I think Switzerland requires some swiss ownership threshold. From the top of my head it's over 50% owned by the end natural/physical persons. Even trough shell corporations.

Otherwise hike the tax on real estate while reducing at the same time taxes on local residents.

Re: Canada bans foreign home buyers for two years

#185

Post by TimPC »

Cthulhu_ wrote: post #127
libertine wrote: post #62

Earlier quoted context omitted.

This is one of those things that a proper tax structure would do wonders - those who hoard housing should get a kick from a exponential tax. Like, what value are those corporations bringing to people, to the market, and to a country by hoarding houses other than controlling the renting market for some areas? How is that a good thing?

> those who hoard housing should get a kick from a exponential tax. Yes, but at the same time it should not be possible for them to pass those costs on to people renting the house; rents should be fixed, or based on things like floor space and amenities. But personally I think everyone should have a way in to the housing market. Renting is throwing away money; it goes into someone else's pocket and it's gone. When yo…

Buying is throwing away money too, often just as much as the rent you were paying. Yes some portion of what you pay goes to principle and you eventually own the home but the following amounts are just lost money: - interest on the loan - utility bills - property taxes

You also have to replace anything that breaks and are responsible for all repairs on the property. Many of these replacements and repairs don’t increase the value of the home.

At best buying a home is a forced investment plan. It forces you to take money above and beyond the cost of rent and put it into a savings vehicle that generally generates good returns. But if you’re renting you could just as easily put that excess money into the stock market if you have the discipline to not spend it.

Re: Canada bans foreign home buyers for two years

#186

Post by randomdata »

cik wrote: post #33

I love Canada - but our government has always been idiotic. The ban is against 'foreign investors'. But the thing is, Canada has a corporate designation called CCPC: Canadian Controlled Private Corporation. Directors of said corporation have to be > 50% resident Canadians. A corporation can be created for the purchase of this property, with a Canadian controlling, and being the director. This will literally do nothin…

Technically the ban isn't on foreign home buyers, the ban is on foreign capital coming into Canada to buy homes. This indirection may make enforcement more difficult, but the intent won't be hard to figure out if one is caught.

Re: Canada bans foreign home buyers for two years

#187

Post by TimPC »

pards wrote: post #98

I'm a homeowner in Toronto and I don't think this will help. They've eliminated a small number of buyers from the market but have added other incentives like a first home buyers tax credit that will only fuel the fire - Australia tried this with tragic results. >> working with provinces and territories to develop and implement a Home Buyers’ Bill of Rights and bring forward a national plan to end blind bidding. Blind…

The one advantage of blind bidding is the slowness. You’re able to consult with everyone you need to between bids. In a live auction you might not get to call your family before having to decide if you want to go $10k higher. Even if your wife is there you don’t have time for an extended discussion on whether it’s worthwhile.

Re: Canada bans foreign home buyers for two years

#188

Post by chii »

joelthelion wrote: post #156
pards wrote: post #100

Earlier quoted context omitted.

The sale of investment properties is already subject to capital gains tax.

I mean a strong yearly tax on home ownership with an exemption for primary residences.

Why should investment properties be taxed worse than say, stocks?

If property is expensive, it means there's a demand for it. The price is a good signal that the area needs more properties built. It's only the gov't (local gov't perhaps, or NIMBYs) that are stopping it from happening.

Raising taxes isn't going to fix the problem. It only forces existing investors who are on the margins to get pushed out.

Re: Canada bans foreign home buyers for two years

#189

Post by peepop6 »

pembrook wrote: post #130

A quick look at the data suggests only about 2% of properties in Toronto and Vancouver are owned by overseas investors. Yes, housing is priced at the margin, but this won't do anything at all to prices over the long term. I'm sure this will be wildly popular politically, because people LOVE the idea that some foreign boogieman is the reason their children can't afford homes anymore. It's much easier to outsource your…

No post body was provided.

Re: Canada bans foreign home buyers for two years

#190

Post by BlargMcLarg »

beaconstudios wrote: post #160
BlargMcLarg wrote: post #65

Earlier quoted context omitted.

Prediction: barely anything happens and problems continue to rise as population numbers have yet to peak and the people who are struggling most with this problem, the working class, continues to lose wealth relatively to the upper classes. Almost every country with these problems has similar symptoms and the problem could've been seen coming from decades away. Tackling these things requires far, far more input from g…

I can see a resurgence of social democracy coming soon as the problems with things like real estate investment and unrestricted emissions come home to roost. We've already seen a little bit of that with Bernie Sanders.

I can't speak for the US, but here in NL, I don't see things changing very soon for various reasons.

Very few voters actually care to solve the issue. Home owners still far outweigh those who don't. Quite a few of the older generation bank on their property/properties to carry them through retirement. No one wants to see their house go under, even if they can realistically endure it without severe consequences. There's no incentive to increase interest rates, but banks obviously don't want to carry more risks, so individuals aren't getting the same mortgage-to-house price ratio as before.

"Figure it out" mentality. Even if there is a national or even global trend, responsibility to solve the issue is pushed onto the individual. Or worse, global mentality shifts to accept what is going on. "Yeah buying was normal back in the day, now you rent. Get over it."

Grandfathering and "empathy for the fortunate". Yes, I get it, you don't want your lucky uncle who worked a bad job for decades to lose his retirement. You don't want Mr. John in his McMansion on the other side of the road to lose his fortune. Almost no one wants to be the bad guy. Yet special ruling to keep the "haves" in their position continue to be placed at cost of the "have nots". No one wants to hurt anyone. As a result, the solution often seem to be continuing the same fruitless endeavor which changes nothing for the "have nots".

As mentioned before, population has yet to peak. Governments are still incentivizing people to come in or reproduce above replacement rate, despite it becoming evident we're just not capable of handling them. In theory we can handle way higher populations. In practice, there's no incentive to do so without severely punishing the working class further.

We're slowly normalizing a cyberpunk dystopia and most people seem okay with it. "At least you have iphones" is going to define gen Z and gen alpha at this point.

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