Canada wants to make homes affordable without crushing prices

Whenever they say "I don't want to drive down prices" that demonstrates a fundamental unseriousness about the crisis.

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.
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.
I think you're assuming waaay too much about the seriousness of this statement. It's a politician assuring the losers of a policy they won't lose by rewording the policy a different way.

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?

Supply and demand control prices. Period. Adding supply will only fail to control prices if demand keeps rising. And if buyer demand keeps rising to keep up with prices? It would suck, but there's actually a silver lining to that: Rent goes down then.

Remember, now that we're punishing vacant units, every investment unit must be rented out. So as the investors make a mad dash to build and buy our endlessly-rising housing units, more and more inventory gets dumped onto the rental market.

Now, there's obvious downsides to this story, I'm not going to pretend the "own nothing and be happy" end is ideal. But it's better than the "own nothing and live in a fucking tent" ending.
- No, market failures exist. It’s not all supply and demand. The cartoon economic world of libertarians is not reality.
  
  That said, we do have a supply problem. Vacancy is essentially zero in Canadian cities, and that’s not true in more affordable housing markets like the US or Japan.
It seems to me that increasing supply alone is not going to cut it.

Well obviously you also need to increase demand. Without that, most Canadians will remain out of the market. The hope is that more home options will encourage increased demand.

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.
- 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.
- Those people will also need to factor in how much housing is causing localized inflation which is eating into their monthly cash flow. Unless the person has a rather large real estate portfolio they could defer the burden to I don't think the current situation is going to work out well for most single dwelling owners unless they plan to move away soon.
- As someone who struggled to get into homeownership in vancouver area it not about investment by candians. you are actively bidding on homes where asian investors trump your offer by 100K without even seeing the property. And the vacancies are bad. Two of my friends rent small basement suite in a giant home. The asian owners have not lived in the rest of the house for 2 years. So an entire family is denied housing for an investor to just sit on the property...not a canadian nest egg.
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

We do tax homes past a primary residence. In fact, we also tax the primary residence.
- Are you talking about the capital gains? Because that's not enough as it treats homes like any other commodity. Homes aren't an ETF. That's the whole point of the tax, to make it no longer an attractive investment vehicle for amateur landlords.
  
  Again look at how Singapore does it, it works.

Those two goals are fundamentally at odds with each other.

Noooot necessarily, but a solution for that is to raise minimum to median wages up to a point that homes are affordable, and keeping existing wealth as it is or taxed. (AKA not happening.)

Big corps, rich lobbyists would cause government to not even begin considering it, it would cause a good chunk of inflation but there's a chance that we could get rising wages to outplace inflation instead of the other way around how it's been.
- That only considers people who are already with a job. Doesn’t solve homelessness.
- That will just push prices higher because now you have more prospective buyers for same inventoru of houses on the market.

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.

Or as in the case of vancouver realestate a foreign owner buys it then never even occupies it
- Is this still happening in Canada?
  
  It was very common in Australia. A lot of Chinese ownership, citizens basically afraid their government could at any moment seize assets & bank accounts looked to move money offshore. Our government had(and still are) been proping the housing market up through every financial crises by any means necessary. So investing in the housing market is almost risk free and the guaranted gains means it easier just to leave it vacant and not have to deal with agents or tenants. It's a safe offshore bank in a country that won't steal your shit if they decide they need warfunds quickly.
  
  But China has several restricted moving money out over the last few years and it's definitely slowed the trend here, not that it's made any noticeable impact to our housing prices

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.

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.
Agree with the diagnosis, but disagree with retrofit. Vancouver doesn’t need that right now. It takes more political will but I think a better solution would be to finish the job of bringing density to downtown and just rezone the whole of west end into condos with commercial fronts. Then move on to do the same with mt pleasant and Kitsilano. SFH within 5 minutes of seawall is just too much subsidy for suburban conservatives.

"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.

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.

Maybe we need to be more vocal? 🤔

Contact the Prime Minister https://www.pm.gc.ca/en/connect/contact

https://www.canadahousingcrisis.com/ will email all of your representatives.
I received a reply today

On behalf of Prime Minister Justin Trudeau, I would like to acknowledge receipt of your correspondence of August 12, 2023.

Thank you for writing to the Prime Minister. You may be assured that your comments have been carefully reviewed.

In your correspondence, you raise issues that fall within the portfolio of the Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance. I have therefore taken the liberty of forwarding a copy of your correspondence to Deputy Prime Minister Freeland for her information and consideration.

Once again, thank you for taking the time to write.

I'm guessing he has a few investment properties already.

And even if he doesn't, a large percentage of MPs do, either because they needed that passive income to actually be able to afford to run for parliament (campaigning is a full time, temporary job, and it's difficult to go a month without an income), or because an MP's salary and position makes it so much easier to afford the rental properties after they've won the election.

And if you can find yourself in the position to set yourself up for life with a passive income, most people are going to take that opportunity. Especially the neo-liberals that dominate all of the viable parties who don't even have a theoretical problem with the idea .

~~Canada~~ International Billionaires want to make ~~homes~~ places where poor people live ~~affordable~~ profitable without crushing prices

*fixed your headline

"I want you to buy a home at this price."

I can't afford that.

"But what if you paid anyway..."

Possibly making a statement before election. Doubt government has any intention make housing affordable.

Interesting to compare with this: https://thewalrus.ca/there-is-no-housing-crisis/

I read an article a while back that argued the only way to really make housing affordable is to build MASSIVE amounts of housing.

Supply and demand is at least part of the problem.

It really isn't in this case, unfortunately.

Lets says I I have a farm that produces all the food people need, but because I own the only farm, I can set the price for food to whatever I want.

Helping me build ten more farms doesn't solve the problem. The problem is that I'm in a position to decide the price. Helping someone else build more farms, might work, but I already make so much I could probably buy them the moment they're done. And even if I don't, we don't actually need more farms. The one I have could already feed everyone.

Building more farms at that point, would be a irresponsible waste of this already overloaded planets resources.

The real solution is dividing up ownership of the already sufficient existing resources. This will crash prices, but that will only hurt those who already have what they need, not those currently unable to get it.
- And even if I don’t, we don’t actually need more farms.
  
  But since you are now operating more farms than needed you've ended up with a flood of product. It costs extreme amounts of money to operate a farm, so you are going to be forced to liquidate that product to pay your bills. The consumer won't pay top dollar for food they don't need, so you are going to be forced to sell it for pennies on the dollar. And now food is cheap.