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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

#691

Post by [deleted] »

johnnyanmac wrote: post #530
weeksie wrote: post #511

Earlier quoted context omitted.

It'll be interesting in a couple years when prices are still crazy and someone has to come up with an excuse for why. It's amazing to me how resistant people are to the idea that housing is expensive because there aren't enough homes for people to live in. It's always a search for exotic explanations like foreign buyers and mysterious empty apartments.

>how resistant people are to the idea that housing is expensive because there aren't enough homes for people to live in. I imagine there are enough homes in both America and Canada (they are two of the largest countries after all). But it's all about location. Very few can even afford to move out to the middle of nowhere just to own land. And not many people that can are willing to turn their potentially short commut…

[deleted]

Re: Canada bans foreign home buyers for two years

#692

Post by jkepler »

dr_dshiv wrote: post #641
weeksie wrote: post #588

Earlier quoted context omitted.

Manhattan (where I live) is extremely underbuilt. Lots of people want to live here! But yes, the implication of a housing abundance agenda is that places will change. I think it's generally underrated exactly how much the cities we know today changed during the 20th century as they grew in population. That said, you don't really need a lot of high rises to drastically increase density. Even row houses and low rise ap…

> Even row houses and low rise apartments make a pretty large difference and would be more than enough to meet demand for most cities that are experiencing a crunch 5 stories. Perfect height.

5 floors was pretty standard across Europe, from Paris to Kyiv, in the age before elevators, as it was about the maximum height most folks were willing to walk up the stairs. Though, in Paris a lot of the 6th floors (where lots of the typically small studio apartments are found) were originally constructed as the maids' quarters.

Re: Canada bans foreign home buyers for two years

#693

Post by kspacewalk2 »

TimPC wrote: post #675
kspacewalk2 wrote: post #574

Earlier quoted context omitted.

I agree that this is the root cause, and it remains a third rail in Canadian politics. The province of Ontario commissioned a "Housing Availability Task Force" to do a [report]( https://www.ontario.ca/page/housing-affordability-task-force... ) spelling out the problem. They identified under-supply due to land use restrictions as the primary cause. The government ignored it and addressed secondary issues with lame ban…

The recommendations of the committee reflect the fact that they had only one month to work in and as such severely limited the consultations they did. To take just one example of how ridiculous some of the conclusions are: They recommend forcing any municipality to accept 6 to 11 story buildings on any street that has a bus route regardless of whether that bus route actually reaches the building or not. This is a hug…

I think we have a philosophical difference here. You seem to accept the idea of centrally planning a city down to the micro-management level. I reject it. Yes, as you say, "this policy says you *could* build an 11 story building without providing parking in any small township on Yonge Street".

The operative word is *could*. If there's market demand for it, you could and you absolutely should do it. If there isn't, you (the builder) won't build it, and you (the tenant) won't move in.

If you focus urban planning on the big picture and allow the market to determine how many parking spots a building needs, or whether a single family neighbourhood makes any sense next to subway stops, the housing crisis will literally solve itself with private money. Instead, we keep floundering while entire generations of our under-30s struggle in precarious housing, because we are unwilling to adopt a different approach. 3/4 of discussions about 'housing affordability' at my city's council meetings are about money pits and bandaids such as airBnB bans and 'affordable housing' (can we build 30,000 units of it with taxpayer money? Didn't think so, let's move on).

If you ignore the blah-blah and focus on actions, we the voters don't really want to solve this problem. If we did, we'd act on the obvious solution.

Re: Canada bans foreign home buyers for two years

#694

Post by tick_tock_tick »

clpm4j wrote: post #582
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,…

Eliminating a subset of buyers, i.e. slightly decreasing demand, is an easy and obvious action to take. Will it have a significant and long lasting effect? Very likely not. But when examining the supply-demand equation, it's painfully obvious to say "foreigners who don't live here should not be allowed to buy residential housing". It's way, way easier than incentivizing developers to build affordable housing and deal…

> build affordable housing

Lets build shitty buildings that will last for decades. Affordable housing is and will always be a horrible idea. Build and build until you get a surplus and suddenly tons of housing is affordable.

Re: Canada bans foreign home buyers for two years

#695

Post by rasz »

mise_en_place wrote: post #655
rasz wrote: post #575

Earlier quoted context omitted.

>Foreign investors jump into the housing market because the current system ensures that the supply some do, others just want to safely park capital away from their own government reach (China/Russia/various *stans/corrupted countries).

The real reason is that those foreign investors are productive and have excess capital available to invest. They are from creditor nations, not debtor nations.

If you call local corruption productive.

Re: Canada bans foreign home buyers for two years

#697

Post by seanmcdirmid »

kelnos wrote: post #664
seanmcdirmid wrote: post #612

Earlier quoted context omitted.

Don't get me wrong, I'm pro density. However, it seems like they are kind of like building new freeways, which rather than reduce traffic, simply induce more demand. By say taking Seattle and making it 4X dense...I doubt it would become much cheaper...instead it would just become more popular (still, I would love to live in a more dense Seattle, but I don't think I would save money by it).

I'm not sure you can draw a parallel between those two things. Is there any evidence that induced demand applies to housing as well? I would think it might to some degree, but there would be several cut-off points, as living conditions change with more density, and people who previously wanted to move to a place might not like how a place changes as density increases. With a highway, you can add as many lanes as you…

> Is there any evidence that induced demand applies to housing as well?

Yes, plenty of people are discouraged from moving to a hot city due to the lack of supply. Increasing supply then moves discouraged demand into actual demand. Otherwise why do dense cities (like Shanghai, NYC, Manila) still experience housing shortages?

If the place is desirable, demand increases to catch up to the new supply, bringing us to the same place where we are now. Even if we built a lot of housing in a desirable place, enough that we hit a cut-off point: in a hundred years or so, we might have just had more children to soak up that supply (like what happens with agriculture surplus). Things go until an equilibrium is reached (where prices are high enough that demand is discouraged, or the place becomes undesirable to really reduce demand).

Re: Canada bans foreign home buyers for two years

#698

Post by BlargMcLarg »

yokoprime wrote: post #671
BlargMcLarg wrote: post #654

Earlier quoted context omitted.

(b) is the biggest one. It doesn't make second hand unlivable, it just stops putting a premium on things which clearly aren't premium (unlike say Europe). It also makes it easier to tear things down in case of future needs, whereas Europe tends to "lock" itself in, creating a market which is very inflexible. >(c) Keep in mind 1LDKs (living room, dining room, kitchen) come with everything you'd expect a full apartment…

> (b) is the biggest one. It doesn't make second hand unlivable, it just stops putting a premium on things which clearly aren't premium (unlike say Europe). It also makes it easier to tear things down in case of future needs, whereas Europe tends to "lock" itself in, creating a market which is very inflexible Could you elaborate on what this paragraph means? How do we "lock" ourselves in here in Europe? I can go out…

If you can buy a rundown house, yes. Now place yourself in the shoes of the generation who can't reasonable buy a rundown house in a place close to work, and are expected to commute to work. They are dependent on laws and profit margins for anything to happen.

When the profit margins say "building apartments isn't profitable" and the laws say "well whatever", nothing's gonna get torn down for apartments. Turns out when you build things to last and the mentality is that a 30yo house should still be in good shape, there's not a lot of profits to be gained tearing it down and building an apartment complex compared to renovating it a little and selling it to some upper middle class family with more dough to spend.

And yes, there are ways around this, e.g. turning that SFH into a sharehouse. Why that isn't happening more is a whole different story.

Re: Canada bans foreign home buyers for two years

#699

Post by seanmcdirmid »

jkepler wrote: post #692
dr_dshiv wrote: post #641

Earlier quoted context omitted.

> Even row houses and low rise apartments make a pretty large difference and would be more than enough to meet demand for most cities that are experiencing a crunch 5 stories. Perfect height.

5 floors was pretty standard across Europe, from Paris to Kyiv, in the age before elevators, as it was about the maximum height most folks were willing to walk up the stairs. Though, in Paris a lot of the 6th floors (where lots of the typically small studio apartments are found) were originally constructed as the maids' quarters.

In Seattle we hav a lot of 4+1s: a concrete 1st floor and wooden 4 floors above that (some kind of code thing). The first floor is usually retail, however.

Re: Canada bans foreign home buyers for two years

#700

Post by coffeeblack »

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.

So increase the rent to offset the tax.
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