Whenever they say "I don't want to drive down prices" that demonstrates a fundamental unseriousness about the crisis.
this post was submitted on 12 Aug 2023
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Yes. By having an official policy of propping up prices, the government is effectively giving a subsidy to homeowner profits at the cost of renters.
That's the core tenet of neoliberalism: to transfer wealth to the wealthy.
Don't worry it'll trickle down eventually! One day... Any minute now
Housing was expensive four years ago, that was before prices almost doubled. Policy that lowers prices to those levels would put home ownership in the reach of many.
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It seems to me that increasing supply alone is not going to cut it. Are there not a bunch of financial groups with nearly bottomless wallets that enable them to afford to buy up any amount of property to rent or flip at any price they want, even if it means some properties sit on the market empty for a long time? This government policy seems analogous to having people with $100 dollars sitting at a no-limit poker table with a bunch of billionaires who can afford to endlessly put you all in on every bet, so they always bet more than you have and then the government comes in and says they will allow for more games to be played. Wouldn’t the policy be pointless if you don’t also limit the number of games the wealthy players can play?
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Canada wants to eat it's cake while also having it. Something like 60% of Canadians own their home or live in a home their parents own. 40% of a country is more than sufficient to tear the country apart if they lose faith in the society they live in. Allowing housing to become investments has been a mistake that needs to be corrected for the long term stability of the nation.
Allowing housing to become investments has been a mistake that needs to be corrected for the long term stability of the nation.
Canadians are using real estate as their retirement nest eggs. That means they're investing less in productive businesses and are woefully under-diversified. Reducing/removing the capital gains exemption on real estate sales would encourage actual investment.
Shit, when was such an exemption passed? That's literally a law that turns housing into a non-productive investment.
Making a necessity to live in the modern world an investment is the way to turn a portion of the population resentful and unproductive.
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To be fair, the reason they're using it for retirement is because every other method (defined-benefit pensions, defined-contribution pensions, bonds, mutual funds, RRSPs) have been systematically broken by the wealthy.
The dotcom bust, and the lesser extend the 2008 crisis, wiped out a lot of Boomer and elder-Xer equity. Real estate was the next thing that "weath advisors" pushed after they ran the other options into the ground.
If people could retire with dignity and security, we probably could have headed off some of the early stages of the real estate speculation boom. Of course, that would have required rich people to make less money, or face some kind of consequence. As it stands, the economy suits them just fine, even if it fails everyone else.
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If government had the power to just snap their fingers and halve the price of all real estate, regular home owners should not be negatively affected.
It's mostly only the people who own multiple homes as investments, developers, and people who rent out their properties.
If you own a home that you live in, yes it will suck that prices dropped after you signed your mortgage, but you already agreed to pay that before so you should be able to afford those payments wether your house is $1M or $500K.
If you need to move, the house that you need to move to will now be half price so you didn't lose anything with your own house going half price. If anything you win by not having to pay as much taxes.
They want the existing houses to remain expensive while the new houses somehow are cheap? Sounds like they're wishing for a magic trick, or are trying to put lipstick on their business-as-usual pig.
Just tax homes past a primary residence like Singapore. We know it works and at least it'll be real obvious those against are the immoral asses we thought they were
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And I want a unicorn!! 🦄
Yeah that won't happen. Houses just get bought up by those who can afford so they a) can rent them out and b) use it as a safe investment. House prices need to come back down to fix this anytime soon so they can't be seen as an investment.
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There is a logic to this. Private developers will not make multi-year, large capital investments in something if they think that its value is guaranteed to decrease. That should be obvious.
And we desperately need to increase supply. For better or worse, we do still live in a capitalist society so its going to be up to the private sector to increase supply, with the govt providing an incentivizing role. The govt ever saying anything like "we need to bring house prices down" would paralyze private sector investment into building houses.
FWIW, in my esteemed position as an armchair big-social-problems-fixer, the solution is obvious: Govt investment/subsidies to convert downtown commercial real estate towers into condos. Instead of forcing people back to the office to salvage what's left of the real estate value for those empty towers. The owners get their handout, people can continue to work from home, it's good for the environment too! I dunno, I think it makes sense.
We accept that a fundamental need like healthcare shouldn't be subject to market forces. We don't have to treat housing any differently. Vienna was rated the #1 most livable city because they understand this. Our path forward is not only clear as day, it's tested, proven, and already putting out the best results in the world. The only reason we don't follow that path is because those with the authority to change things are in the class of people profiting from doing things wrong.
This. Fucking this.
Homes are infrastructure not investments. Well not monetary investments anyway.
Governments have done the work of providing housing in the past, and still do in limited numbers. There is no reason why they can't just push the number of projects up until there is no housing crisis anymore.
I've heard some numbers here and there, and it seems like there's plenty of organizations providing non-market housing that rent at below half the usual prices. Apparently the YMCA is one of them.
If the governments aren't willing to do it themselves, they can just make it easier for corporations that are willing to provide non-market housing to get the property rights and loans needed to actually get this done.
There is a logic to this. Private developers will not make multi-year, large capital investments in something if they think that its value is guaranteed to decrease. That should be obvious.
Government can make large, multi-year capital investments, too. They just don't want to, because we're two generations of civil servants and politicians that consider publicly-provided services to be heretical.
You'll note that anything that doesn't involve giving money to the private sector is not done, and what little fully public institutions we still have left are a) from an earlier era, and b) so intrinsic to the cash flow of a functioning government that not even the most boot-licking Thatcherite can make a case for selling them off.
If the governments aren’t willing to do it themselves, they can just make it easier for corporations that are willing to provide non-market housing to get the property rights and loans needed to actually get this done.
As above, there is no appetite in government to do this as it would erode the ability of the wealthy to make money, and even if they did, developers would just build something expensive to maximize value.
The entire philosophy of how government delivers services would need to change, reversing course on a quarter-century of neoliberal policy.
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Selfishly want Canada to road test some ridiculous tax for residential properties that you own but don’t personally reside in. 50% progressive increase in property taxes for every residential property beyond the one you live in or something.
"I want to stop being an alcoholic but I'd like to drink occasionally"
You say that in jest but I know far more previous functional alcoholics who drink occasionally vs went teetotaler.
Maybe we need to be more vocal? 🤔
Contact the Prime Minister https://www.pm.gc.ca/en/connect/contact
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I wish they would raise the HBP limit for RRSP that can be used towards a downpayment. It's not like I'm going to be able to retire with that if I can't build equity beforehand.
From the CRA "Currently, the HBP withdrawal limit is $35,000. This applies to withdrawals made after March 19, 2019."
From the article "Recent surges — prices have risen 36 per cent in three years"
So it should be closer to $50,000. Maybe $60, 000 would be better to account for prices continuing to rise while we wait for something to be done to improve the situation.
"I want you to buy a home at this price."
I can't afford that.
"But what if you paid anyway..."
~~Canada~~ International Billionaires want to make ~~homes~~ places where poor people live ~~affordable~~ profitable without crushing prices
*fixed your headline
Possibly making a statement before election. Doubt government has any intention make housing affordable.
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