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Billions in 'unknown' funds flowing into Canada's housing market [video]

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Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#311

Post by MichaelZuo »

dukeofdoom wrote: post #300

You can always build more houses, start new cities, its not a real problem. But a million dollars brought in, goes directly into the economy from a foreign investor, makes a country rich. Trading something that is low skill to make, into money that can be spent on all kinds of infrastructure and technology. So my only take on this is that how that invest money is spent by that country if its a net positive or negativ…

I agree, municipal budgets should be going way up since they’re all funded by property taxes to varying degrees. That means there will be more money for investing in infrastructure, new projects, etc., that of course benefit every resident.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#312

Post by JohnTHaller »

teruakohatu wrote: post #77
cheesecake_luvr wrote: post #54

Earlier quoted context omitted.

Overseas buyers just get permanent residency and citizenship and buy houses. A few years ago you just needed ~$NZ5m invested in the country and you get permanent residency. There is no way the prices are driven by domestic money. My factory supervisor brother has a house in Mangere Bridge, a blue-collar suburb, built for ~$100k 20 years ago is now well over $1m. It is batshit crazy. I hear of eye-watering prices in M…

> A few years ago you just needed ~$NZ5m invested in the country and you get permanent residency. There is no way the prices are driven by domestic money. In 2019-2020 just 38 of this class of visa was approved, which seems to be about the average per year over the last decade. It was just 16 in 2020-2021. I don't think these people are buying decrepit Auckland villas, two bedroom semi-detached or tiny one bedroom ap…

Investment firms like BlackRock ($9 trillion dollars in assets under management) bought up 15% of all houses offered for sale in the US in the first quarter of this year.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#313

Post by Nelkins »

yardstick wrote: post #273
imtringued wrote: post #252

Earlier quoted context omitted.

It's always funny how people come up with increasingly convoluted solutions to a simple problem because they don't want the simple solution. I honestly don't see how this is going to solve the problem. You're just making it harder to express the problem but it is still there.

I’ll bite: what’s the simple solution?

Make housing abundant by building more of it, like we used to.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#315

Post by rorykoehler »

roel_v wrote: post #230
rorykoehler wrote: post #145

There should be a global rule that non-residents can't buy property. Homes should be prioritised for living not investments. It's a drag on the global economy with so much money being tied up in unproductive assets which in turn soak up even more money through rent seeking.

That's not what rent seeking means

Sure it is. From wiki: Rent-seeking is the effort to increase one's share of existing wealth without creating new wealth.

Landlords soak up all excess income from increased productivity. Where do you think the term came from when it was coined?

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#316

Post by tengbretson »

grecy wrote: post #238
tolbish wrote: post #3

Should housing be a primary vehicle for investment and the de facto way of making money? Or should it serve as a necessity and basic aspect of life?

It is not possible for housing to simultaneously be affordable and a good investment. Given it's a basic human right, I feel we shouldn't allow housing to be an investment.

Who are you willing to have thrown in jail in defense of that right?

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#317

Post by pas »

akudha wrote: post #239
pkorzeniewski wrote: post #168

Earlier quoted context omitted.

I'm disgusted by the whole real estate market, people buying dozens of apartments and houses just to rent them - and hence increasing prices for people who just want something on their own instead of making rich people richer - is destructive for society, especially for young people. Owning a roof over your head shouldn't require an average person to work their ass for half of their lives.

Most financial gurus preach real estate as a way to get rich. They don't care about the next generation, fuck them. I have a colleague who earns in dollars, but he buys real estate in his home country (India). He'd buy a few apartments in a building right when a new project is announced. By the time the project is completed (2-3 years usually) the apartment value has already gone up by 10-15% minimum, sometimes more.…

Why do you think it's morally bad what this guy does? Developers make a profit, he basically provides loans to developers, takes on risks.

Prices are too high because there aren't enough units being built, not because folks speculate on new developments.

The rentiers are who do nothing yet they earn extra profit due to market failures. (Usually mandated monopolies or emergent oligopoly markets, see ISPs in the US.)

I agree that the end result of only luxury units being built is disgusting. And I think that's absolutely not an unpopular opinion. But it's this way because society, voters, representatives, local governments, etc.. are stuck in a very suboptimal configuration.

I agree that it should be a basic right.

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#318

Post by dukeyukey »

IkmoIkmo wrote: post #268
andrewharvey wrote: post #180

Earlier quoted context omitted.

Supply is increasing, but if that increased supply gets snatched up by investors then you haven't really increased supply for people who need a place to live.

These investors want tenants. The more supply, the more (ceteris paribus) rents drop. The more rents drop, the lower the rates of return on the home, meaning the asset is worth less and prices drop for those buying homes, too. Supply leads to lower rents and prices. There's no magic way around these economic laws. Of course if demand grows faster, then prices still go up. But in absence of supply increases it'd be ev…

> These investors want tenants

Not necessarily. By the UK Government's own estimate [1], 1-in-20 homes in West and Central London (the more expensive parts) are empty. The story I've heard is owners who use them as a store of wealth safe from their own government's hands (usually Russia, China, or places in the Middle East). They prefer not to have tenants because it adds risk and complexity. I'm not saying this is the true story, but it's what I've heard, and there are definitely lots of expensive, empty apartments.

[1] https://theconversation.com/londons-extraordinary-surplus-of...

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#319

Post by flycaliguy »

michael1999 wrote: post #296
mymythisisthis wrote: post #267

Earlier quoted context omitted.

I'm from Ontario, Canada. I find that it's average people getting into the real estate game as a way of protecting their wealth against inflation and not wanting to play the stock market. People blame internation investors, but that is only a small problem. People say we should build more homes, but Ontario already has 10s of thousands of approved homes to build, that have not yet been started. Lack of skilled trades…

Ontario grows by more than 100k people per year. 10s of thousands of homes/year is losing ground, not even treading water.

Yeah, there is a pretty well circulated blog post [1] explaining this population growth. Ontario just wasn’t ready to see this many people show up.

If anybody doesn’t make SV money and wants a good tip: Consider an early inheritance of your parent’s home if you can build them an addition. That’s what we are doing. Took out a small mortgage to buy out my sister and we are now raising a family with grandma nice and close. We’ll assist her through old age and the entire thing feels very, I don’t know, European I guess?

[1] https://mikepmoffatt.medium.com/ontarians-on-the-move-2021-e...

Re: Billions in 'unknown' funds flowing into Canada's housing market [video]

#320

Post by anonAndOn »

mistrial9 wrote: post #270
Mandatum wrote: post #107

Earlier quoted context omitted.

I think what you're seeing is everyone previously investing in stocks, business, etc. are now going all-in on property. Mum and Dad are pulling their supers and investments and gifting it to their kids for their first home. It is entirely unsustainable. But we've been saying this for 15 years now.

huh? both Mom and Dad - you lost a great number of people right there.. pulling their supers? over-65 wealth is that common? and this one, really interesting.. "gifting" .. what is that ? I see tooth-and-nail fights over any piece of money in sight among otherwise ordinary relatives.. Mostly Los Angeles SoCal but everywhere in California really.. "gifting" ?!?

Well, according to the loan docs it's a "gift" but to everyone else it's an interest free loan from mom & dad until they sell the place. It's quite common in California, and everywhere else I've lived in the US.
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