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Canada bans most foreigners from buying homes

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Re: Canada bans most foreigners from buying homes

#131

Post by maximilianroos »

fleddr wrote: post #121

I want to give some push-back regarding the often-heard phrase that governments should stop restricting supply. I'll be using the situation in the Netherlands to explore some complexities. These may not apply everywhere, but it serves to illustrate that the situation is far more complex than "stupid zoning". First, the reason the Netherlands is in a similar situation as Canada (400K home prices, very tight supply) is…

I don't know about the Netherlands. But in many US cities — in particular SF & LA:

1) It's extremely difficult to get approval for new housing

2) There's a large backlog of developers attempting to build new housing

...which should convince anyone that regulation is the binding constraint, not a lack of willingness to build.

Re: Canada bans most foreigners from buying homes

#132

Post by tux2bsd »

BurningFrog wrote: post #75

One good rule of thumb is that whenever people are blaming foreigners for their problems, they're wrong. Investment in housing and price increases are related. But it's the price increases that cause the investments, not the other way around.

> One good rule of thumb is that whenever people are blaming foreigners for their problems, they're wrong.

The current trend is that people from nations that were colonisers are the cause of, and are responsible for, the woes of descendants of colonised peoples. It's good to see that you can see through the bullshit too.

There are only select groups that can invest in property, they must reach the baseline investment sum and ongoing payback before they can play the game. Having unchecked offshore ownership is massively damaging to the local people, it raises the bar all that much more. Offshore control of property can easily be weaponised, where it's not about investment but instead about legal denial of property to the locals.

NZ suffers from some of this.

Re: Canada bans most foreigners from buying homes

#133

Post by dan-robertson »

PragmaticPulp wrote: post #118
BurningFrog wrote: post #75

One good rule of thumb is that whenever people are blaming foreigners for their problems, they're wrong. Investment in housing and price increases are related. But it's the price increases that cause the investments, not the other way around.

> One good rule of thumb is that whenever people are blaming foreigners for their problems, they're wrong. Another good rule of thumb is to not dismiss issues just because they don't fit an over-generalized idea of how all situations must work. The housing situation in Canada is weird . I visited a friend who lived in a high rise and barely saw anyone else come and go from the building the entire week I was there. Fr…

Stupid question, but how did you tell that they had been purchased by foreign investors?

Re: Canada bans most foreigners from buying homes

#134

Post by bamboozled »

BurningFrog wrote: post #75

One good rule of thumb is that whenever people are blaming foreigners for their problems, they're wrong. Investment in housing and price increases are related. But it's the price increases that cause the investments, not the other way around.

So I live in a small mountain town where we've seen a massive influx of foreign investors driving up the price of housing because they're coming here and paying off locals to find them houses to buy for a private holiday house.

There are middle men who do the finding then flip the property for 500% of what they buy the house off a little old lady for, on selling it to a rich person from overseas, who use the house for 2 weeks of the year, price all the local would be family buyers out and now, because the investor paid so much for it, it will likely never been affordable to the people of this area again.

The interesting thing about all this is that for the people buying, it's still so cheap it's like buying a car for them, so it's a massive detriment to the local community, and for those buying, it's like a rounding error in their bank account.

Do you call this "blaming foreigners" wrong? Because the people who are organizing this scheme do understand they're ruining the local culture. I'm pretty sure people who are buying the houses are aware they're just storming in using their cash and not really trying to integrate at all, they're not stupid.

What annoys m the most about these parasites, is they don't pay tax, they buy a property, use all the local resources I pay for as a tax payer, contribute zero to the local area.

It is a type of invasion whether you like that word or not.

Re: Canada bans most foreigners from buying homes

#135

Post by themitigating »

asdff wrote: post #59
standardUser wrote: post #45

Earlier quoted context omitted.

Just because a policy does not solve a problem outright does not make it symbolic. The article discusses other measures that have already been implemented and points out that current housing prices are way off their peak from a year ago. If this policy further reduces demand even a little, that will have an impact on the trajectory of housing prices. That's not symbolism.

It is symbolism when everyone who is paid to think in this space considers it not to be a solution to the root of the problem, which is a lack of housing supply to keep up with job growth. You've banned foreign investors, great, there are still domestic investors who will fill the void in the market like gas in a small room. If you want there to not be investors, then housing shouldn't be such a great speculative ass…

"local governments have opted to constrain supply and support investors rather than the workers they represent in their constituency."

The local governments zoning laws might benefit investors but that may not have been goal of the government. What should they do to support workers?

Re: Canada bans most foreigners from buying homes

#136

Post by themitigating »

loeg wrote: post #73
standardUser wrote: post #45

Earlier quoted context omitted.

Just because a policy does not solve a problem outright does not make it symbolic. The article discusses other measures that have already been implemented and points out that current housing prices are way off their peak from a year ago. If this policy further reduces demand even a little, that will have an impact on the trajectory of housing prices. That's not symbolism.

It doesn't move the needle. It's symbolic.

That's true. Will this policy not have any impact?

Re: Canada bans most foreigners from buying homes

#137

Post by themitigating »

JacobThreeThree wrote: post #58
tomohawk wrote: post #19

Earlier quoted context omitted.

Exactly. This is only attracting foreign interest due to th artificially constrained supply. If they were serious about the issue, they would increase supply.

Imagine if the government of Canada used just 1% of the 89% of crown land it owns out of all the land in Canada to give to people for housing.

Sorry, is Canada lacking in empty land? You are using percentages but what's the percentage of total land?

Re: Canada bans most foreigners from buying homes

#138

Post by ehsankia »

meowtimemania wrote: post #126
beyond_based wrote: post #124

It’s too late and the problem isn’t even with the foreign buyers anyway. It never has been. Much like complaining about zoning, It’s a dumb misdirection play that people fall for every time.

What is the problem?

I agree with GP that foreign buyers are mostly a scapegoat, but unlike GP, I do believe zoning is the main issue. Giving zoning power to local politics will always end up with the same issue. Rich homeowners voting for board members who pass laws which limit supply, resulting in the value of their assets going up. It's the same issue all over the world. Single detached houses do not belong in cities.

This is a great playlist around the subject:

https://www.youtube.com/playlist?list=PLTNrJFli7ocgtZNW5IzFs...

Re: Canada bans most foreigners from buying homes

#139

Post by dan-robertson »

db48x wrote: post #76
BurningFrog wrote: post #75

One good rule of thumb is that whenever people are blaming foreigners for their problems, they're wrong. Investment in housing and price increases are related. But it's the price increases that cause the investments, not the other way around.

Luckily you can depress prices really quickly by forbidding sales of property :)

The question is how many sales will it actually forbid? If the sales (or bids) that push the prices up are coming from people who will be banned, maybe prices will be depressed a lot. If they’re coming from Canadians who have good jobs and a bunch of cash and won’t be forbidden then maybe prices won’t be affected much.

Re: Canada bans most foreigners from buying homes

#140

Post by plantain »

I really don't understand why governments around the globe just throw their hands in the air and pretend housing is an unsolvable problem for which they have no obligation to fix.

It wasn't always like this - in 1922 in Australia we realised there was a shortage of 25,000 homes, so they just made it happen [1]. Why are we so impotent today? Do we just not care enough? Are the vested interests too powerful?

[1] https://pbs.twimg.com/media/FlSIML5aYAAVmvf?format=jpg&name=... https://nla.gov.au/nla.obj-2947838631/view?sectionId=nla.obj...

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