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Canada likely sitting on the largest housing bubble of all time: Strategist - BNN Bloomberg
(www.bnnbloomberg.ca)
this post was submitted on 31 Aug 2023
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God I hope so
When it pops most people still won’t have money (because recession) and corporations will scoop in and buy up all the assets oh boy!
Right so we just implement socialist policies in housing.
I mean, water, power, education, healthcare are all heavily regulated or controlled by the government. Why not housing? It is a basic human need after all more of a basic need than education (not saying education should change).
It’s sweet that you think we can just implement social policies like that.
Only the rich and corporations would benefit from the housing market crashing.
I mean, just tax corporate home ownership, double property tax for homes that sit empty for more than 3 or 6 months, and put a 50% tax on any rental net profits above 15% of the total rental price.
Use that money for high density/low income development grants, seems simple to me.
Bit of a stretch to say only. I know several middle class people who are renting and would be in a much better position if rent dropped and housing dropped.
Admittedly those middle class who already own a home would be affected.
But they can afford to be affected. They'd still own their house, whereas now more people can own one too.
Or anyone sitting on their hands waiting to buy a house… like all the young peop—oh yeah they don’t have any savings because rent went up and wages never moved.
What? Not the people who can't afford a house? They wouldn't benefit?
Where do you get this malarkey? I can't wait to hear what mental gymnastics you go through to make this seem true.
People that can’t afford a property now won’t be able to either when we go in a recession. Housing prices will drop, sure, but so will people’s incomes/savings. Individuals and entities that have deep pockets can withstand this dip and swoop in to buy up all the cheap properties and hoard them until the prices inevitably go up again.
I’m not the only person that thinks this way.
Or do you think the housing market exists in a vacuum and the bubble will pop without any other economic consequences?
Why do you keep saying recession?
I don't think prices will drop, period. The moment they do, a company will buy up all it can and prevent the average citizen from owning anything, just as you said.
As far as income is concerned, there's no way in hell it will drop proportionally in a real estate crash, just like wages didn't rise proportionally with a bubble.
I don’t know if you’re being intentionally obtuse about this? In case you’re asking in good faith, I say recession because I don’t think it’s mutually exclusive from the housing bubble popping. I think if one happens the other will follow. But that’s just me.
Ok then.
despite my socialist views I'm also a realist: no elected government in Canada or US would socialize real estate. None. Within current economic and political system it's a surefire recipefor country implosion. The only feasible solution is taxing "luxury" properties and diverting that money towards subsidized/public housing. Demand outpaces supply and supply is being choked by corporations and individuals scooping up properties and not releasing them back either as rentals or for resale. Make it passable for them to sell and impossible to hold and we can bring market to some shaky equilibrium. Build more affordable housing and you may stabilize the market. There are no other options on the table as far as I know.
That's my take as well here in Australia.
No person should own more than one house, and no corporations can own a house ever.
If you must move, that's ok, there is a central no reserve auction system that you must place your property into.
You can also buy your new property from said no reserve auction system.
Making housing a wealth vehicle is immoral
I agree, but the path forward to get everyone else on board with socialized housing is pretty bleak. We can walk and chew gum at the same time, but we’re having issues hanging onto our socialized healthcare.
I think we also need to re-think how we work and good work opportunities for people. We’re supposedly in a housing crisis but there is more than enough land in Canada. We need to disperse more people away from huge cities (and the green belt) in my opinion. There needs to be good opportunity elsewhere. I have no clue how we can do that outside of UBI or something.
The extreme concentration of wealth is just accelerating and hurting everyone except the fantastically wealthy.
build HSR between vancouver and toronto, and between detroit and quebec city. every few hundred miles seed a new city with government agencies and remote offices of companies. use good urban design principals so it's not just another car hell, not just because it's better but also as a selling point to get people to move there since it's qualitatively better
Radical, I like it!
it's not that radical, just kinda expensive up front, but you can do it in sections. connect toronto to winnipeg, buy the land, start your seed cities use the funds to do the winnipeg to calgary line (optional later extending to edmonton) and then to vancouver repeating the process. the HSR makes them functionally suburbs of the bigger pre-existing cities they connect to, and with housing prices like canada that's immediately attractive on it's own. make sure to cooperate with the USA and mexico to establish a continental standard for compatibility for HSR to prevent future issues.
seed jobs, enable population-based service jobs like teachers and restaurants move in to capture demand and provide further jobs. now you have an economy in these cities and people will start moving there for non suburb-reasons. offer tax breaks to companies to move to these new cities, and raise taxes generally on businesses to make it revenue neutral.
build 20,000 public housing units in each city to provide immediate housing and establish a starter housing stock, protect against homelessness and kickstart the construction industry there (also jobs) and then the companies you paid to do that can go on to build privately owned housing
optionally but highly recommended is to build walkable, bikable urbanist cites that are what the younger generation (older people are mush less likely to want to uproot, espically if they already own a home, so they shouldn't be the primary target audiance) is looking for, and also do green construction that fits in well with the climate of each location. these aren't required per se but you may as well. canada has the same auto dependency problems as the USA and this is a great chance to provide an alternative
you can do this in the USA too but canada has even more immigrants per capita so if someone's already moving to canada from abroad they can just choose to settle in one of the new towns for the same effort as toronto. honestly we need a fuck ton more housing in general, not just for the native born population to have a snowballs chance in hell at moving out of their parent's place and starting a family, but also there's gonna be a big global refugee crisis because of climate change being ignored for so long so those people gotta go somewhere
I've been saying similar things about Saskatchewan itself. HSR and the ability to commute to different cities easily is the future.
Because this generation of white americans has been indoctrinated to believe any form of government assistance is a bad thing, unless it's for corporations.
We really need to start limiting the number of properties/parcels/acres that any one entity can own. It's really the only way to stop corporations from taking over.
Then they just set up multiple holding companies.
Need to lower the profit margin by increasing supply beyond demand, then even if every home is owned by a corp they still need to compete against each other to keep them all occupied and impose a tax for empty dwellings.
Need to restructure how property can be held then so random numbered companies can't own anything.
I bought a house before the pandemic (just barely, and with a lot of help, but still) and even I want it to pop. It's ridiculous. Even setting aside my objections to housing as an investment, a house should not be your entire retirement plan.
Because when it "pops" prices drop? Would this be tied to other markets (like say groceries)?
If it is a bubble that's going to pop, it'll most likely happen alongside a recession. The price of groceries may drop, but alongside a lot of jobs lost or fear of losing your job.
Joke's on you. I always fear losing my job.
You can always get another job.
It's not like we're running out of work to do.
Sorry, I wouldn't hold my breath for the real estate market to improve.
As long as all the inventory is accounted for, they will just sit on it to keep prices up and rip off whoever needs a house.