Risk of forced home sales rising in Canada, warns economist - "The focus of the economists’ concern is mortgages refinanced with non-bank lenders. Chartered banks must ensure that borrowers meet mortgage stress tests, but alternative lenders are less regulated."
Opinion: Canada’s approach to housing is bad for the economy - The Globe and Mail - "when real estate accounts for much of an economy’s wealth, it tends to steer both investment decisions and state policy toward unproductive outcomes. Firms that hold real estate have been shown to be less productive than those that don’t; their collateral makes it easier to get credit than firms that, even if more dynamic, are property-poor. Equally, politicians find it hard to resist policies that juice property values when homeowners make up such a large share of the population, even if those policies inhibit growth. Home ownership itself can slow the economy. Efficiency depends on matching skills to jobs, which requires factor mobility. If you lose your job or if you just have better opportunities elsewhere in the country, it’s much easier to pack up and leave if all you need to do is end a tenancy... as property values rise, all workers become less mobile, owing to the sheer cost of moving. Germany, another country with comparatively good labour productivity, enjoys the edge it does largely because it remains to a large extent a society of renters. Real estate evangelists will quickly ask: If renting is so great, why are so many Canadians so keen to get on the property ladder? The answer may be that Canadian laws tend to favour owners over tenants. In Germany, where tenants enjoy far more rights, investing in rental properties tends to get taken on only by those looking for a stable income stream. Preserving rather than growing wealth, it produces a model in which renting remains an attractive, even lifelong option. Being car-loving homebodies – Canadians own much bigger houses and spend less on dining out than Europeans – many see all this as a reasonable price to pay for the lives they want to lead. But falling productivity will ultimately force tough decisions. Moreover, the high carbon intensity that results from this model of urbanization may store up future problems."
Why doesn't Toronto build "regular" apartment buildings instead of luxury condos? : askTO - "They say “luxury” but really it’s pretty cheap materials that just look nice. Renderings do wonders to hype it up pre construction. I think building them cheaper would be a little dent in their overall construction cost."
"“Industrial lofts” aka purposefully unfinished"
"100%. I'm renting in a new luxury condo. Our sink leaks, washer leaks, and my neighbors door handle feel off the other day. It's so cheap"
"I hear you. Moved into a brand new "luxury"condo at the end of 2020. Since then there have been a staggering amount of problems, here's a short list: randomly flickering entryway light, leak from unit above through a light fixture into the bathtub, cupboard door installed incorrectly so it needs its screws tightened once a month, smoke detector failed and went off at 1am, cartridge for the kitchen faucet failed about a month after it was out of warranty. The building has had lots of major problems too, ranging from elevators needing constant maintenance, driveway needs to be repaired around once per season, there was a major leak requiring months of repairs, and to top it all off a literal dumpster fire. This is not an exhaustive list, and I know many people have had way worse problems with new builds."
"If OP thinks Toronto "luxury" condos are luxury then they clearly don't know luxury. I actually am yet to see a truly luxury condo in Toronto, and I live in one of those buildings myself super downtown and have visited many while doing viewings with $3-4k budget for one bed. There probably are a few truly luxury ones with an actually nice finish, most likely renovated by the owner who actually gives a shit about where they live, but rarely for renters Compared to say, Dubai or London or NYC"
Maybe the same leftists condemning "luxury" condos are also condemning dishonest builders for false advertising and shit work
Why doesn't Toronto build "regular" apartment buildings instead of luxury condos? : askTO - "The family estate was in rural Markham because it would be inhumane to bring children up in such tight quarters of the city"
So many people think that single family housing is the only way to raise children.
Why is housing cheaper in Quebec than in Ontario? - "What did Quebec do right or, alternatively, Ontario do wrong? Social housing is not the answer, as it is less common in Quebec (7.8 per cent of tenants in Montreal, 13.3 per cent in Toronto). It may be that Toronto has more social housing precisely because its housing market is less efficient. A major urban planning difference is Ontario’s use of development charges levied on developers, in principle to cover the costs of urban services generated by new residential developments (roads, sewage, transit, etc.). Quebec municipalities did not historically have the power to levy charges, except for minor costs such as parks. This prohibition had far-reaching consequences. In 1989, Ontario brought in the Development Charges Act. The argument for development charges seems reasonable: to make developers pay the social costs of development. What could be more progressive? Development charges would facilitate construction – making development pay for itself – in addition to providing a welcome source of revenue for local governments while lessening pressures on property taxes. Development charges seemed like a good thing. The true impact was different. It opened a trap door that was difficult to close once opened. Calculating the cost of services generated by residential developments is not an exact science, leaving much room for discretion. The temptation to keep adding on services financed via development charges is difficult to resist. The provincial government loved them too because they allowed it to offload services to municipalities. This is exactly what happened in Ontario... The impact on housing was threefold. First, the direct cost was predictably passed on to consumers, renters or owners. Second, since this was an upfront charge, often also entailing drawn-out negotiations with local government, only developers with sufficient resources entered the field. This curbed supply, producing an oligopolistic housing market. Finally, since charges are levied per unit, irrespective of income generated, it created an incentive to build more expensive (often high-rise) units, which explains in part Toronto’s “missing middle.” Let us return to Quebec, where urban services are largely financed via general property and provincial taxes. The result was a more open market, that facilitated the entry of small developers and the building of the two- and three-story “plexes” that are less costly to build and typical of Quebec cities. Lifestyle preferences were undoubtedly also a contributing factor. Quebec also lacks Ontario’s legislated greenbelt or the recently enacted provincially significant employment zones, both of which limit the land available for residential development. Overall, Quebec’s housing market has historically been less restrictive than the one in Ontario."
Damn greedy landlords and investors, and conservative governments refusing to build social housing! Clearly more regulation is the answer!
Real estate in Canada: Will the bubble burst? - "Colmar argues that those looking for a "big headline about a housing bubble" should be keeping an eye on the disparity between house prices and incomes. He warns that decades of low interest rates in Canada "seduced a lot of home buyers" and has led to "excessive leverage backing up the whole system." But how leveraged are Canadian homeowners? Colmar says it's significantly "north of where the U.S. was" before the 2008 housing market crash... Unlike the U.S., where buyers can qualify for a 30-year mortgage, Canadian borrowers must renew their mortgages every five years -- at the prevailing interest rates. Colmar argues that's one of the reasons mortgage burdens can become astronomical... Although Colmar doesn't think that a housing crash is imminent, he does warn that when "you're dealing with these kind of excesses… hopefully interest rates don't rise." Colmar says some of the key factors to watch for are further interest rate hikes and employment levels – warning that if rising unemployment levels combine with spiking mortgage rates Canada could face a situation similar to the 2008 crisis in the U.S. What would that look like here? "A very deep deleveraging cycle, a quite pronounced recession," Colmar says. "The currency will take it on the chin too.""
Canada wants to make homes affordable without crushing prices - "“Our goal is not to decrease the value of their home,” Housing Minister Sean Fraser said in his first interview with Bloomberg News since he took the job on July 26. “Our goal is to build more units that are at a price that other people, who don’t currently have their needs met, can afford.” Fraser’s comments underscore the ambitious — and contradictory — aims of a government that’s trying to quell a political backlash against the soaring cost of living, but doesn’t want to adopt policies that would damage the millions of Canadian households whose wealth is tied to their homes... Fraser reiterated Immigration Minister Marc Miller’s comments last week that reducing the number of newcomers isn’t the answer for Canada’s housing shortages."
Leaked memo shows Trudeau warned immigration would cause housing crisis - "Prime Minister Justin Trudeau was warned in June 2022 by Secretary of the Cabinet Janice Charette that his immigration policy since taking office in 2015 triggered Canada’s housing affordability crisis... Trudeau’s response was to ignore the warning and announce that he would bring in more immigrants. He also blamed the provinces for not “stepping up” to fix the housing problem. “The purpose of this note is to provide you with an analytic summary of the report’s findings,” wrote Charette in a classified memorandum Report by Canada Housing and Mortgage Corporation: Canada’s Housing Supply Shortage... Conservative Leader Pierre Poilievre took issue with Trudeau’s denial that housing is a primary federal responsibility. He argued that local governments do not have the revenue capacity to adequately address the affordable or social housing problem. “To some extent, people do look toward the federal government mainly because it's the level of government with the greatest fiscal powers,” he said. Poilievre reminded Trudeau of his promise eight years ago that he would lower housing prices, but instead has more than doubled them."
Damn racist xenophobe!
The End of Homeownership - "Canada hasn’t always been a nation obsessed with homeownership. Before the Second World War, fewer than half of Canada’s city dwellers owned their own property. The authors of the 1931 census report even declared that the advantages of homeownership were “undermined in urban areas by the convenience and attractiveness of modern multiple-unit dwellings”—renting, in other words... mobility, the great purported advantage of renting, has disappeared as rents have risen. Renters like Ullman and Ireland are shackled in place not by a mortgage, but by the certainty that moving will mean paying far more every month... In 2001, the Squamish First Nation successfully reclaimed a historic village site called Sen’ák¯w, not far from downtown. In 2019, the nation announced plans to build 6,000 rental homes on the 10.5-acre parcel—a level of density far beyond what would be allowed under municipal zoning, but permissible because, as First Nations land, Sen’ák¯w is not beholden to city rules. A major goal of the Squamish housing strategy is allowing their members to build the kind of housing wealth that has historically been out of reach for First Nations—not to mention building homes for thousands of people in a city experiencing a dire shortage of housing. This has drawn fierce opposition from homeowners in nearby Kitsilano, a 1960s hippie enclave that has aged into one of the city’s most expensive communities. A nearby neighbourhood association has even gone to the B.C. Supreme Court to seek a judicial review of an agreement struck between the First Nation and the city, which would require the city to provide municipal services to the development... Political polarization may also intensify. In 2021, British researchers analyzed recent electoral results in 11 European countries. They concluded that not only were renters and homeowners politically divided, those divisions grew as homes became less affordable. Homeowners became less supportive of policies such as rent control or tax reform to help non-owners, and even less supportive of building new housing. Renters moved in the opposite direction."
Clearly the solution is even more rent control, so no one will move
Lone tenant in a $400-a-month apartment could delay major condo project - "She is the only remaining tenant in her building, which is slated to be demolished to make room for a 176-unit condo project. But in order to move forward, the developer must reach an agreement with White — and she says she won’t leave until she’s provided with a home that offers the long-term stability she needs to ensure she won’t end up back on the streets... senior partner David Owen said the company has been trying to negotiate with White for “three or four years” without success. He said that the company has offered White a different apartment, which she refused. They then offered her $20,000, which she also refused, he said. “She indicated to our lawyers that she wanted a penthouse and an amount of more than $50,000,” he told the committee. White and her lawyer, Manuel Johnson, say she’s not asking for anything unreasonable, given the city’s skyrocketing rents and the disappearance of affordable housing. Johnson believes her story is a “classic class conflict,” that pits the desire of wealthy developers to make a profit against the needs of the wider population... White wants an apartment with an affordable rent guaranteed for at least five years, or the equivalent in cash. They acknowledged the developer did offer White one apartment, but she says she didn’t feel safe in the proposed building and wasn’t convinced the rent wouldn’t rise... The two parties are set to appear in June before Quebec’s administrative housing tribunal, which adjudicates disputes between landlords and tenants. Johnson, however, doesn’t believe that body will have the authority to impose a deal, especially because he and his client are satisfied with the city’s ruling. He believes that if an agreement isn’t reached, it will be up to a Quebec Superior Court judge to clarify, which could be a much longer process."
Damn greedy landlords keeping housing expensive!
Too bad for the 175 people who would benefit from the new project. Because profit is evil, they are all bad people too
Toronto’s rules about shade are costing us new housing - "thousands of Torontonians are consistently prevented from finding homes within tall buildings because ours is a city scared of its own shadow. Consider the fact that every year, thanks to the city’s planning policies around the “shadow impacts” of new developments, likely hundreds of potential highrise units are scrapped from building plans because they would cast shadows on public parks and private backyards. Have you ever wondered why so many residential buildings in Toronto look like they’ve had a bite taken out of them by Godzilla? Or put another way, why they resemble multi-tiered wedding cakes instead of conventional highrise towers? This is thanks to “angular planes” guidelines entrenched in city policy; guidelines that require certain floors be set back within a building to mitigate shadows cast on the ground below. According to Toronto planning guidelines, tall buildings downtown must be designed so as not to “cast new net shadows” on “signature parks” and “open spaces.”... Ironically, you’d think those priorities would include shadows. As I write this, Toronto and most of Ontario is under a heat warning"
As Toronto gets more and taller condos, the city is left grappling with shadows - "Shadows cast by tall buildings blocking out the sun can upset residents who are impacted. After all, when buyers drop massive amounts of money down for a condo, sunlight is often a major selling feature. Studies have also shown that exposure to sunlight can boost serotonin, a chemical that controls our moods and that reduced sunlight can lead to decreased energy and sadness... The city requires shadow impact studies as part of the highrise development applications for proposed buildings about six storeys or taller... City planning staff might also prepare their own shadow studies during application reviews, appeals or city-led planning studies"
Damn AirBNB and investors keeping housing expensive!
Asking people to walk into the sun violates their human rights
Is a $100,000 salary enough for a comfortable life any more? - The Globe and Mail - "For $100,000 earners with gargantuan shelter costs, it’s also getting trickier – and is sometimes now impossible – to manage another staple of a financially comfortable life: owning a car. Lofty vehicle prices and high interest rates mean Canadians are now paying an average of $813 a month to finance a vehicle on a seven-year loan, the most popular auto loan term... Of course, most urbanites can easily do without a car. But for people who rely on cars to commute into city centres, the swelling costs of ownership are eating into the savings that normally come from living far away from a downtown core. Even buying a used second-hand vehicle – which in the past has meant big savings compared with buying new – isn’t working so well these days. The average listing price of a used passenger vehicle in Canada is currently more than $38,000, a number buoyed by strong demand and low inventory, according to Canadian Black Book. The challenges facing Canadians contemplating car purchases are similar to those facing many who are house-hunting right now, according to Ms. Simmons, the financial planner. “I think often people who are in a lucky position with timing will confuse their success with savvy,” she said. “And it’s not. It was just luck. Just timing. Luck you got in before everything skyrocketed.”... Another common source of housing-related financial pain is a divorce or breakup, Ms. Simmons said. She often sees couples, who together had no difficulty paying housing costs, break up and be thrust into the fray of the rental market, she said. Even if each partner earned $100,000, she said, basement apartments could turn out to be all they can afford individually. “They used to live aboveground and now can’t afford that,” she said."
Rural areas not exempt from high cost of living: Ontario Living Wage Network - "“It is not cheaper to live in rural Ontario. It’s a stereotype that you’ve got farmers near you, so food will be cheaper. It’s simply not. We don’t have employment friendly transportation between communities, so it’s a challenge to hold down a job without a vehicle,” said Dobbyn... It’s not just the extra cost of transportation in rural Ontario that’s pushed up the cost of living, shelter in particular is no longer “cheaper” outside of urban boundaries... Dobbyn and Erb said more employers than ever have signed up to pay their employees a living wage, but that can also add to the costs of goods, transportation and food."
The majority of Montreal households are renting - "Despite housing in Montreal generally being more affordable than housing in Vancouver or Toronto, 63% of Montreal households rent rather than own their own homes, according to a new analysis of 2016 census data by the City of Montreal’s economic-development office."
From 2017
Canada has two housing crises. One requires more government, the other less - The Hub - "Housing crisis number one is pretty simple. Housing completions have been relatively stable for decades while population growth has increased. People try to make this complicated, blaming their preferred causes—whether it’s foreign investors, immigrants, or the whole capitalist system. In reality, it’s math. If there aren’t enough new condos for upper-middle-class urban professionals to buy or rent, they move down market to older units. That pushes middle-class buyers down a notch on the housing ladder, and some people off entirely. At the risk of sounding simplistic, the solution to this crisis is to make the math work. In other words, we need to bring housing completions into line with population growth. Ideally, we’d do that entirely by building more housing. If we fail to do that, we’re probably going to end up with less immigration—a lost opportunity for Canada. We can resolve housing crisis number one through slower population growth, more housing, or both. Whatever we decide, it’s a conceptually easy (though politically difficult) problem. The standard left-wing line gets crisis number one entirely wrong. It might well be because they’re focused almost exclusively on housing crisis number two. Housing crisis number two is much more complicated. After all, some people are never going to be able to afford market-rate rents. It’s probably not a large proportion of the population—the vast majority of people are housed through the private market—but it’s the most vulnerable segment of the country. We could cut rental rates in half and some people would still be left out. Frankly, many of those people need more than just affordable housing. Some are dealing with complex addiction issues, broken families, and trauma. It’s tempting to think that everyone can be pulled up onto their own two feet if we just give them a hand. The addict, the unemployed single parent, the domestic abuse survivor. But even if healthy housing markets around the world, some people fall through the cracks. It’s not just about cheap rent. The Left is correct when they point out that some people will never be served by “luxury condos.” Where they err is in assuming that this is true for everyone. Building enough new homes to bump the rental vacancy rate from 1 to 3 percent, for instance, would put downward pressure on rents. Even slightly lower rent payments and more locational options would be a welcome relief to many renters. We shouldn’t discount this just because it won’t help everyone. We can walk and chew gum. We can address both housing crises... While it’s theoretically possible to solve crisis number one without solving crisis number two, the reverse isn’t true"
The left hate the private sector, so
The left don't understand that increased supply flows through a market
Canada’s New Housing Minister Has Already Demonstrated He’s Clueless - "Minister Sean Fraser pledged to make housing more affordable without lowering prices. He reiterated the housing-is-an-investment mindset, before dropping suggestions that would reinforce higher prices. Great news for investors. Not fantastic if you pay taxes, or you need affordable housing... Details on how he would lower and not lower home prices at the same time were scarce. However, he did mention he would increase supply, incentives, and development speed. It’s a narrative repeated since 2015, and made Canada the affordable market it is today... The problem here is once again that developers only control their pricing floor. They can stop building if prices fall to the point it’s no longer an incentive. They don’t control the market price of a new home, which is set by the marginal buyer. The maximum a marginal buyer is able and willing to pay is often set by the amount they can finance... even if the input costs fall, that doesn’t translate into how much someone is willing to pay—the amount they can finance does. If the marginal buyer is an investor, they’re still likely to outbid the first-time buyer with a subsidy. Tragically, the only way to make housing more affordable is by lowering the incentive to make it an investment. That means it can’t be both the most important investment a person can make, and a sustainable solution for shelter. If it’s the former, the role of an investor is to capture as much profit as possible, knowing an end-user will overextend themselves. One person’s home is another person’s rental dividend."
Too bad the writer is a left-winger who is against increasing supply ("eviction by re-zoning" is a great way to justify NIMBYism), subsidies and reducing costs, and just rails against investors (as if renting out housing doesn't reduce its cost), because left-wingers are economically illiterate
This is an interesting insight into why the left keeps wanting to impose costs on developers: they think people don't respond to incentives, so if prices rise it's just because of "greed" - not the costs they demand
Of course, if you mention that the incentive to make housing an investment is due to immigration, you're racist. Their "solution" is to have government build all housing, or at least all rental housing. Good luck with that
Woman lists room for $900 a month but renter must share bed with her - "One Toronto tenant hoping to rent out a room has received strong criticism after stating that the tenant has to sleep in the same bed as them for $900 (£525) a month. The rental advertising post was for a “shared bedroom in a lake-facing downtown condo”... According to the person advertising the room, they have had a similar arrangement with a roommate they met on Facebook, which allegedly worked “perfectly”."
Is it cheaper to stay in a hotel than rent in Toronto? - "With average Toronto rent prices dipping slightly to $2,908 in October amidst the affordability crisis, living in the city has grown increasingly impossible for many. Could hotels offer a solution? Toronto’s Don Valley Hotel is undercutting rental prices in the city by offering stays on a month-long basis for $1,999 plus tax — including parking, pool access, Wi-Fi, weekly cleanings and utilities... At around 326 square feet, the rooms are “fully furnished” with one king-sized bed, a bathroom, TV, dresser, lounge chair, a small table and several chairs. Every room comes with a balcony... The rooms have no kitchen, but were provided with a fridge and microwave, Porter continued. Tenants can opt to share their room with another person at no extra charge... Porter noted some of his tenants have lived in the rooms for years, with his longest-running customer staying for more than six years... the Palmerston Hotel, for example, charges a daily rate of around $60. However, it requires a minimum stay of 28 days, according to its website, totalling around $1,680. Meanwhile, renting a room in a furnished house “hotel” like this one by Toronto Furnished Living goes for around $1710 for 30 days, or $57 per night"
The leftists were complaining, not considering that ease of eviction and lack of "rent" control are factors
GTA Condo, Purpose-Built Rental Completions to See Record-Breaking Year
Clearly, there was no point removing rent control
Jagmeet Singh and NDP need to drop the 'luxury condo' slur - "What is luxury? To some it’s a Tuscan villa, a fancy SUV, or VIP bottle service at a club. For a lot of the old guard left, though, luxury is a tiny box in the sky called a condo. I’ve learned this fact following Canadian housing and development politics for a couple decades where, inevitably, somebody utters the phrase “luxury condos” as a kind of gotcha slur during community meetings or on list serves and social media. Look a little closer and the “luxury” in question are the generally small or tiny condo units that the very same people will denigrate as unlivable, a place unfit for a family where even a full-sized bed won’t fit. Funny how that works both ways. Which is it: luxury or Dickensian? Less funny was seeing NDP leader Jagmeet Singh and the federal NDP lean heavily into this kind of rhetoric recently. While discussing building housing on public land, Singh said it should be 100 per cent affordable and shouldn’t be used to make developers rich or build luxury condos. Let's unpack this a bit. Over and over, the people referring to condos as luxury often live in houses they own that are far bigger, have more outdoor space and are more expensive than those "luxury" condos. It’s the weirdest thing and most warped of perceptions, but a given among a large part of the population: they personally don’t live in luxury, but other people do... The developer and luxury rhetoric is aimed directly at a very comfortable and housed old guard lefty base who don’t like change — a dog whistle that can galvanize a lot of people for or against something... Big bad developers don’t help themselves by hiring marketers who push every new project as luxury or use imagery and words that imply as much even when the reality is a tiny box. Yet unless you’re a carpenter with Jesus of Nazareth skills, it’s likely a developer built the place you live, big or small."
Shawn Micallef: ‘Luxury condo’ is a slur the left wing needs to drop if it wants to help the housing crisis : toronto - "Of course developers call them luxury for the same reason Presidents Choice doesn't describe their chocolate chip cookies as mediocre but instead calls them decadent."
When even a left wing publication is making the point. Of course, a common response was pretending that this is a straw man (I guess the NDP doesn't count). One even tried to associate The Star with The Toronto Sun
