Here’s the thing about housing:
The delegates insisted on one hand that “housing is for living not speculation”, but on the other, emphasised the critical importance of real estate to China’s economic growth.
In other words, things are complicated. We want housing to be affordable to more people, but at the same time, we recognize that housing appreciation is kind of useful for overall economic growth. So we’re a bit conflicted. And that may be why we tend to take contradictory actions.
Broadly speaking, the current playbook in Canada seems to be as follows: heavily tax new housing, force those who can afford new market-rate housing to subsidize those who can’t, and then tax/ban foreign buyers.
Canada’s new foreign buyer ban came into effect on January 1 of this year. And for the next 2 years, it prohibits companies and people who are not Canadian citizens or permanent residents from acquiring non-recreational, residential property in Canada. (What is the definition of non-recreational?)
While this may sound good to some — finally, more homes for Canadians — we’re talking about a relatively small portion of the market, which is likely why there’s also little evidence that any of our foreign buyer taxes have been all that effective.
It’s really hard to imagine this one working much better. But it certainly sounds like something.
Banning foreign buyers is a good idea and I hope there are more ideas being put into action to ensure we are building enough housing for Canadians, whether they are new to this country or not. Personally I am happy when I see new condo developments. Next step could be to address all of the single family homes near subway stations. Take a page out of Athens’ book? Developers purchased land or traded land and offered landowners a unit or 2 in the new building.
there will not be a silver bullet but this needed to happen 10 years ago but here we are, let’s see the results amoung the other things we need to change to get pricing under control