This timeline provides an overview of some of the key housing issues faced by communities across Ontario and how governments have responded to these issues over the past 50 years, including a detailed look at how the pandemic has exacerbated existing issues. It shows that, as investments in affordable housing have dwindled, housing insecurity has grown – especially among the most vulnerable communities.
This is the big one. You can build as many houses as you want and it won’t help regular people if investors keep buying them all up.
I agree that such tax reform (and other regulatory measures) is really needed.
But, if the units are purpose built for affordable housing (as proposed federally in https://liberal.ca/housing-plan/ , for instance), this should at least not fall into the investor problem, no?
Yeah. And tax reform is far outside the political mainstream at the moment. So we’re stuck with bandaids (GST rebates, zoning changes, etc) when we need serious reform.
Don’t get me wrong: all those lil things are nice, as is building homes, but they aren’t going to add up to a serious improvement in the next few decades. If ever.
Yes it will, assuming they get rented out then of course it will.
The problem is zoning and developer fees. Our government at the municipal level is regressive with zoning and development taxes. While the Federal government uses mass immigration to artificially boost GDP to hide a technical recession, which adds a huge amount of new demand.
In enough volume, yes. But that volume is massive. 3.5 million units by 2030. We built something like 240k houses last year. We’re nowhere near the supply/demand balance that you’re describing.
If an insufficient number of homes are added, prices will remain the same or continue to inflate.
That’s tens of thousands of dollars on units that cost over 700k. So 5-10% of the sticker price on new builds. Removing those charges does little to lower the price of existing housing.
There are a host of other factors: expensive materials, not enough labourers/trades, money laundering, etc. But a huge issue is the amount of money in housing.
The feds and provinces could address that through tax changes, but politicians don’t have the guts. 🤷♂️
Ah yes, true prices would rise as Canadians compete with investors. We should disallow mortgages for those with second homes and ban foreign investment in perpetuity.
“At the upper end, government charges can represent more than 20% of the cost of building a home in major Canadian cities.”
https://publications.gc.ca/collections/collection_2022/schl-cmhc/nh18-35/NH18-35-1-2022-eng.pdf
The final cost to the buyer is more relevant than the cost to the builder. It looks like that’s closer to 5-7%.
There are lots of small things that might take a few percent off the cost of housing, if developers and landlords are feeling generous. But we’ll need systemic reform if we’re going to get prices back to affordable.