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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

#951

Post by seanmcdirmid »

zip1234 wrote: post #789
seanmcdirmid wrote: post #741

Earlier quoted context omitted.

> Land value tax would prevent people from buying land without a plan to make it useful. Ya: a land value tax is just a property tax that ignores improvements (charing based on what could be built rather than what is built). But it would totally destroy the low income housing market (since property owners of old run down low-end rentals would be seriously penalized for not building new luxury apartments).

1. There is a difference between luxury apartments and new apartments. 2. More likely the most egregious wasted land uses will be destroyed and not something already being used fairly productively. For example empty lots or parking lots are low value and would be turned into housing, driving down prices far before any existing building would be affected

> 1. There is a difference between luxury apartments and new apartments.

In the USA, not really. Today's new luxury apartment is tomorrow's old but affordable housing. Given the expense in building something, there isn't much cost difference to developers in building low-income units or high-income units, and if they go with the latter they will lose their shirts (Not to mention the low-income tenants of those houses would have to pay land use taxes similar to their richer neighbors).

> For example empty lots or parking lots are low value and would be turned into housing,

There really aren't many of those left in the cities people want to live in. Undergound parking and multi-level parking garages are already a thing in dense locations where property values alone mean turning something into a parking lot is bad use (unless you are saving up the parking lots to create something rand like Vulcan's South Lake Union project in Seattle).

I'm still all for it, but we would probably have to sink a lot more money into public housing to prevent a bloody revolution from occurring.

Re: Canada bans foreign home buyers for two years

#952

Post by hadlock »

dwighttk wrote: post #876
huevosabio wrote: post #493

These are boogieman policies that have zero influence on the root cause. Foreign investors jump into the housing market because the current system ensures that the supply of housing is limited so it is an attractive way to park your wealth. But that is not the root cause. The root cause is the system that is geared to keep houses always appreciating via supply constraints: aggressive zoning, discretionary permitting,…

If houses don’t appreciate, why buy a house? Just rent

We bought a house, then had to move cross-country. After owning, where all they did was examine our finances, it was really degrading having to submit an application to rent a house, background check, references etc. Also when something breaks I have to call someone, who will then, within a week or two schedule a handy man to come by and fix it. I have no say over the appliances, external appearance of the house, can't apply for a permit to convert the attic into a third story, fix the inadequate wiring (technically to code, but my space heater will blow out the circuit because it's attached to several other things in the house). I recently reseeded the back yard, at great time expense, and things generally while nice, look a lot more run down than if I owned it and could make improvements knowing I would retain the value, but I'm not going to pour money into this house just to let the landlord receive that value at no charge. Also when he and his wife feel like retiring here, we're going to have to move, at our expense with no recourse. We already tried buying it from them. Renting sucks.

Re: Canada bans foreign home buyers for two years

#953

Post by thawaya3113 »

huevosabio wrote: post #493

These are boogieman policies that have zero influence on the root cause. Foreign investors jump into the housing market because the current system ensures that the supply of housing is limited so it is an attractive way to park your wealth. But that is not the root cause. The root cause is the system that is geared to keep houses always appreciating via supply constraints: aggressive zoning, discretionary permitting,…

Building more housing does not lower housing prices. This should be fairly obvious but here’s why it doesn’t work, at least in the US, and frankly would cause huge problems if it did.

The major problem is that the vast majority of the U.S. which is not underwater in debts, has the majority of their wealth in their houses. So if building more housing led to a secular reduction in housing prices, people would get poorer.

Which means that it will never happen, because people who own housing in those areas and therefore control the entire political processs, will not accede to shooting themselves in the foot even if they are YIMBYs.

What this means then, is that the only housing that will be allowed to be built, or the only housing that will not in turn make the people of the area poorer, will be “luxury” housing, which does not lower their property values because it compensates for the drop in housing value due to greater supply by adding “amenities”, allowing them to maintain their existing house values.

The escape route for this is low income housing. Creating cheaper housing for people who couldn’t afford to buy their houses anyways, and therefore even though it leads to lower cost housing, it doesn’t lead to a drop in their house values (if anything, it may lead to an increase in their house values since it reduces virgin land that could have otherwise been used to build non low income housing that would compete with their houses).

Re: Canada bans foreign home buyers for two years

#954

Post by franciscop »

kogepathic wrote: post #360
franciscop wrote: post #175

Earlier quoted context omitted.

I've been thinking a lot about this, and I think to promote everyone's owning a house, and even small-size investments, but to avoid megacorps the ideal would be something like: 1 house - tax breaks 2 houses - same taxes as currently for 2 houses 3+ houses - incrementally more expensive with each extra house Also there's a really nice law in Spain, born for the wrong reasons, that makes you pay more taxes if the hous…

> 1 house - tax breaks Why should society be subsidizing home ownership more than they already do? The real estate market already discriminates against people who cannot afford a deposit (an increasing proportion of people, since house prices are increasing so rapidly), and the design of North American cities encourages urban spawl which is unsustainable with current property tax rates. [1] > and I think to promote e…

> "Why should society be subsidizing home ownership more than they already do?"

Because it's good for society if a large % of the population owns a home. I'm not advocating for more urban sprawl.

> "no one is wringing their hands about how people should be owning their home instead of renting"

What do you mean? People are desperate in e.g. Berlin, that they don't come here to HN and write in German about it doesn't mean that it's all rosy.

> "there seems to be a borderline obsession with owning a house in anglophone countries"

I'm a Spaniard living in Japan, not American, so not sure what you mean.

Re: Canada bans foreign home buyers for two years

#955

Post by upvotepartytime »

seoaeu wrote: post #935
xapata wrote: post #848

Earlier quoted context omitted.

Then it's even easier to move. If the polity doesn't want to zone for more housing, they've chosen to expel people who can't pay more than $X for rent. They'll feel the pain when there's no one around to make their coffee anymore. There's no such thing as unlimited demand for luxury housing. Build enough and the rent will fall for the existing housing stock.

> Then it's even easier to move. Moving requires finding a home somewhere that they can afford. The fact that they’ve been subjected to rising rents rather than a financial windfall like nearby homeowners… makes that far more difficult for them

They could have bought. Instead they took advantage of the optionality afforded to a renter that can up stakes and move at will, without being tied to a mortgage.

If they couldn’t afford to buy then they got to take advantage of a locale they desired at a lower price, another benefit of renting.

(While it would be nice if anyone could live — and own — anywhere they like without worrying about price or competing demand from the billions of other humans around, that’s so far away from reality it’s not worth discussing.)

Re: Canada bans foreign home buyers for two years

#956

Post by _3u10 »

liketochill wrote: post #894
_3u10 wrote: post #846

Earlier quoted context omitted.

Vancouver and Toronto isn’t a housing market in any real sense of the word. Supply is fixed by government, interest rates are fixed by government, etc. If you took government control out of the market prices would plummet. Any plank will do, supply, financial backing or interest rates and the whole thing comes crashing down. That’s the real problem, how to cause a 20% “correction” and not 80%. My house is 8 hours fro…

Revelstoke? If so, revelstoke like Vancouver is actually pretty hemmed in by water and mountains. There isn’t an infinite amount of easy to build on land like the on the prairies. Quality of life in revelstoke is probably amazing! Small town, ski hill, mountains, biking, snowmobiling, fishing, lakes, rivers, airport, and lots of jobs Demand will always exceed supply in desirable locations, that is part of what makes…

Better than revvy :)

Oh it’s already inflated away 30% in less than a year. It was 30% of my income.

Re: Canada bans foreign home buyers for two years

#957

Post by shkkmo »

seoaeu wrote: post #938
shkkmo wrote: post #784

Earlier quoted context omitted.

Up to a point, this is true when the affordable housing has had it's cost bid up by high end customers because of a scarcity of high end housing. However, once that high end market pressure has been abated, then there a real and hard limits to the amount of high end housing that can/will be available to low income customers. Instead of being available cheaply, this high-end housing stock will end up being used as a v…

We’re not anywhere close to this in any of the high cost markets. But once we do get to that point another thing will happen: the lower demand for high end housing (there’s only so many vacation homes and short term rentals you can sell) will make it economical to build new mid-range housing

> there’s only so many vacation homes and short term rentals you can sell)

There are many markets the the number you can sell far exceeds the available land to build.

I fail to see how lower demand for high end housing makes it more economical to build mid-range housing? The price for that housing will be lower and land to buiody it on will be taken up by lower density high end housing.

High end housing construction is better than no construction, but please don't pretend it is sufficient to solve the need for other types of construction.

Re: Canada bans foreign home buyers for two years

#958

Post by sofixa »

wbsss4412 wrote: post #866
sofixa wrote: post #776

Earlier quoted context omitted.

> But you aren’t getting 5-6 story multi family buildings constructed at a face pace in major metro areas. In many places, such construction in prohibited entirely by also how family zoning. Of course you are. Tons! They sell like hot bread ( as in within weeks of starting sales all appartements are sold, with 1.5-3 years of waiting for the construction to finish), and cost an arm and a leg in the really fancy parts…

I was referring to North America (had a typo in there, should have said “at a France pace”, ie france is building these and NA is not), I get the sense your comment here is in reference to France?

Ah sorry, I misunderstood you and was talking about France indeed.

Re: Canada bans foreign home buyers for two years

#959

Post by raxxorraxor »

huevosabio wrote: post #493

These are boogieman policies that have zero influence on the root cause. Foreign investors jump into the housing market because the current system ensures that the supply of housing is limited so it is an attractive way to park your wealth. But that is not the root cause. The root cause is the system that is geared to keep houses always appreciating via supply constraints: aggressive zoning, discretionary permitting,…

I disagree that zoning alone is the problem as you see these market developments in almost all western nations and some of them have ample land to build upon.

Zoning could be more liberal, but it would still be massive stakeholders that would build new homes and rent them out to get a decent ROI.

Re: Canada bans foreign home buyers for two years

#960

Post by _carbyau_ »

cycrutchfield wrote: post #924
rbanffy wrote: post #922

Earlier quoted context omitted.

> If developers build more luxury housing According to this reasoning, if Ferrari builds more cars, Fiats will get less expensive. I don’t think that’s how it’s supposed to work.

If Ferrari sold 10 million cars per year, you don’t think that would have a downward pricing impact on other cars?

Basically, not sure how to interpret "sold 10 million cars".

2 scenarios come to mind:

1. Ferrari decrease their sale prices, thus they are more affordable for all, thus exerting price pressure on Fiat.

2. People somehow have a bucket more money and now buy Ferraris. But with all this money sloshing around, Fiat might as well up their prices because it'd make little difference on the end customers purchase decision.

In either case, the Ferrari and the Fiat are closer on price but the price pressure on Fiat varies. Curious to know your thoughts?

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