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Canada bans most foreigners from buying homes

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Re: Canada bans most foreigners from buying homes

#311

Post by stoppingin »

xvilka wrote: post #208
stoppingin wrote: post #189

Earlier quoted context omitted.

Sydney's metropolitan area is already oversized. People are already regularly commuting for well over an hour to the city center on congested public transport, or driving on congested roadways. I don't think Melbourne is much different Where would we put 25,000 new homes today?

Just do it like any big Asian city: 1) build high-rises 2) build more metro lines Look at Tokio or Shanghai, as an example.

Why do so many people here take for granted that living in Asian-style megacities is inevitable, or even remotely desirable? I really don't want to live in such a place.

Re: Canada bans most foreigners from buying homes

#312

Post by firecall »

plantain wrote: post #140

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:…

One of the problems we have today in Australia is a lack of trades!

A few large Home Building Companies have recently collapsed.

We also have a shortage of qualified tradespeople that are capable of contributing to the building of homes.

I'd link sources, but a quick Google will tell you all you need to know!

Material costs have risen sharply too!

Re: Canada bans most foreigners from buying homes

#313

Post by killjoywashere »

BenFranklin100 wrote: post #303
philliphaydon wrote: post #261

Earlier quoted context omitted.

Because today houses are not for living in. They are investments. There's multiple issues that need solving now. 1) Being able to purchase a house without ever setting foot in the country. NZ decided to stop foreigners buying houses. There were websites you can go in and people from China would buy houses without ever setting foot in NZ... The buying power of alot of people from China and India is huge. This drives u…

The reasons we don’t have enough homes is because governments have made it illegal to build enough new homes to meet demand. You are essentially say that the presence of car collectors leads to car shortages.

If there was a car-note interest deduction like there is a mortgage interest deduction, you can bet that every car owner would apply pressure to shutter car factories, effectively shifting value to the spare parts market to remain sustainable.

Re: Canada bans most foreigners from buying homes

#314

Post by AussieWog93 »

josho wrote: post #276
philliphaydon wrote: post #261

Earlier quoted context omitted.

Because today houses are not for living in. They are investments. There's multiple issues that need solving now. 1) Being able to purchase a house without ever setting foot in the country. NZ decided to stop foreigners buying houses. There were websites you can go in and people from China would buy houses without ever setting foot in NZ... The buying power of alot of people from China and India is huge. This drives u…

I don’t necessarily see a problem with point 2. Renting a house often creates supply. The owner will create a basement suite or a nanny suite over the garage. If housing shortage was solved then that also kills the profit motive of renting out all but the most ideal houses for renting. The root cause in Canada is the neoliberal policy that started in the 90s that ended government building low income housing. They lef…

>They left the free market to do its thing. And this is the end result of decades of free enterprise. We’ve built lots of housing for upper middle class because that’s profitable for builders and largely left the poor/young to be screwed.

Is that true? I'd imagine building a big block of, say, 100 units to be far more capital efficient than building a few freestanding homes, if zoning laws allowed it.

Re: Canada bans most foreigners from buying homes

#316

Post by seanmcdirmid »

Supermancho wrote: post #101
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. I don't think history reflects this view. You might remember something like the Revolutionary War, et al. One country often targets and exploits other groups of people. In modern terms, "foreigners" is a practical way to describe the exclusion of a specific nation's members and it's allies. In the USA/China some…

> I dont remember the exact Chinese tax law change enacted by Xi (which effectively taxed foreign holdings), but it caused a mass exodus of Chinese investment and crashed the luxury good market for the Bellevue area over a handful of months.

China doesn't tax property even in China, so I would be surprised if it taxed property held in America. I haven't heard of any specific tax laws on foreign holdings (and in general, China unlike the USA does not tax worldwide income for its citizens and residents). What could have happened is something more informal, like a threat to the upper class to reign in their excess, but Bellevue, at least, is still heavily being populated by Chinese (primarily techies, not investors, who wouldn't be affected by whatever Xi said anyways).

Re: Canada bans most foreigners from buying homes

#317

Post by lobstersammich »

One thing that I'm not seeing mentioned in any capacity in the comments on this HN page is role of institutional investors. Prior to 2008 'single family homes' did not exist as an asset class that the asset management companies - Blackstone, etc. - were able to invest their client's/investor's money into. Long story short, the Savings & Loan implosion of the 1980s in the United States soured investor's money on SFHs. But when 2008 rolled around asset prices were depressed; the banks were flush with cash thanks to a bailout bonanza, and thus began the bulk purchasing of residential real estate by asset management firms.

Read it from the horse's mouth, Redfin: in Q3 2021 investors bought 18% of single-family homes sold in the United States. 1 in 5. https://www.redfin.com/news/investor-home-purchases-q3-2021/

In 2016, 2017, 2018 we were averaging around 50,000 to 60,000 homes being bought each quarter by institutional investors. Then, when the pandemic fun bucks got released (and I'm not talking about the $1200 'relief' checks that went out) we were looking at 80,000 to 90,000 homes bought by institution investors each quarter in Q2 2021 and Q3 2021, respectively.

Add in Airbnb / the short-term rental markets decimating housing stock in many cities and countries, plus intentionally restrictive zoning ordinances in the US and in Canada, and it's no wonder that North America's housing market looks the way it does in 2022.

Also from that Redfin article: > Investors Have the Highest Market Share in Atlanta, Phoenix > >In Atlanta, nearly one-third (32%) of homes that sold in the third quarter were purchased by investors—the highest share of the 40 U.S. metropolitan areas Redfin analyzed. Next came Phoenix (31.7%), Charlotte, NC (31.5%), Jacksonville, FL (28.3%) and Miami (28.1%). > > Atlanta also saw the largest year-over-year gain, with investor market share rising to 32% in the third quarter from 12.9% a year earlier (+19.1 ppts). The second-biggest jump was in Charlotte (+18.2 ppts), followed by Phoenix (17.7 ppts), Jacksonville (+15.2 ppts) and Las Vegas (+14.6 ppts).

I'm curious (and hopeful) to see how the Canadian situation plays out. I hope that increased enforcement of antimoney laundering laws will also result in a return of many thousands of single-family housing units to the market. If the Canada law works well it would be encouraging to see it applied in the United States with additional funding at the federal level for the construction of dense apartment housing in cities near transportation hubs as well dense housing in suburbs/exurbs with the creation of mini walkable downtowns in those denser pockets.

Re: Canada bans most foreigners from buying homes

#318

Post by w3gv »

eldaisfish wrote: post #309
josho wrote: post #276

Earlier quoted context omitted.

I don’t necessarily see a problem with point 2. Renting a house often creates supply. The owner will create a basement suite or a nanny suite over the garage. If housing shortage was solved then that also kills the profit motive of renting out all but the most ideal houses for renting. The root cause in Canada is the neoliberal policy that started in the 90s that ended government building low income housing. They lef…

this misses the point. The root of the housing shortage problem in Canada, Australia and New Zealand is zoning. Zoning plus NIMBYs make housing wasteful by allowing only single family houses in vast areas of prime land. This is a simple supply-demand problem, not anything complicated. The solution is equally simple - make zoning laws basic and limited in scope.

NIMBYs and zoning preceded the housing shortage by decades. To attribute it solely to those two factors is oversimplifying the problem

Re: Canada bans most foreigners from buying homes

#319

Post by LarryMullins »

amake wrote: post #302
LarryMullins wrote: post #283

Earlier quoted context omitted.

> The country is running out of space really fast I get what you're saying, but it's kinda funny since Canada is enormous and most of it is mostly empty.

that's the joke

Oh, I thought he was being sincere. Canada's population is mostly crowded into a small part of Canada, something like 2/3rds of the country live south of the 49th Parallel (south of long straight part of the US/Canada border), and in this region the population density is quite high.

They do have a ton of land in all the rest of Canada, but for reasons of access to services, climate, etc.. most people in Canada are crammed into the Quebec-Windsor Corridor.

Re: Canada bans most foreigners from buying homes

#320

Post by w3gv »

fatbird wrote: post #185
mavelikara wrote: post #174

Earlier quoted context omitted.

I was asking about the rich people in his county, who don't currently live in the mountain town.

In Canada, the vast majority of rich foreigners buying property are American. Chinese investors, the favourite villain of the "rich foreigners" class, make up only about 4% of foreign real estate investment.

That 4% is hard to believe. Source?
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