Canada's 'housing bubble' deemed close to bursting

[hipster duck]

Originally Posted by casper

Hosing starts in Canada are around 277,000 per year. Average number of people per household in Canada is around. 2.5

We should be able to accommodate 682k newcomers per year.

Yikes. Central planning mindset at its finest.

[WarrenC12]

Originally Posted by whatnext

LOL, it is the YIMBY wokesters apparently don't understand that Demand is half of that equation.

What is a "YIMBY wokester". Immigration will spur demand, and yes we already have a lack of supply. What should we do? Freeze immigration or build more homes?

[thebasketballgeek]

Originally Posted by casper

Hosing starts in Canada are around 277,000 per year. Average number of people per household in Canada is around. 2.5

We should be able to accommodate 682k newcomers per year.

One problem is that most new builds are occurring from multi-family dwellings which on average house 2 people per unit.

Also, the problem that new builds are generally unaffordable for newcomers to the country.

Oh yea we still have to make up for decades of under building housing. Frankly, the number of housing starts probably has to be closer to 1 million per year then 500k to play catch up.

[casper]

Originally Posted by thebasketballgeek

One problem is that most new builds are occurring from multi-family dwellings which on average house 2 people per unit.

Also, the problem that new builds are generally unaffordable for newcomers to the country.

Oh yea we still have to make up for decades of under building housing. Frankly, the number of housing starts probably has to be closer to 1 million per year then 500k to play catch up.

I don't think that is a problem.

When someone buys a new home they are usually leaving the older home they use to be living in. That older homes is usually at a more economical price point.

As people age and there kids grow up and move off they may want to downsize.

[Truenorth00]

Originally Posted by whatnext

To some degree they'll be bailed out by quickly rising rental rates in the big cities.

Long term rental rates are pushed up by supply being diverted to the short term rental market. Many of these will end up on the resale market when their proprietors can keep eating the losses, especially if there's a recession. Some will even end up back on the long term rental market. More housing stock for buyers and renters should on due course stabilize rents or even bring a decline.

[lio45]

Originally Posted by WarrenC12

What is a "YIMBY wokester". Immigration will spur demand, and yes we already have a lack of supply. What should we do? Freeze immigration or build more homes?

There’s a third solution: continue to have high immigration, continue to build very little supply, and as a result, enrich the current bunch of Canadian property owners even more

Nothing wrong with the above, and if Justin can reliably promise it will continue for four more years, I’ll even consider voting for the Federal Liberals

[WarrenC12]

Originally Posted by lio45

There’s a third solution: continue to have high immigration, continue to build very little supply, and as a result, enrich the current bunch of Canadian property owners even more

Nothing wrong with the above, and if Justin can reliably promise it will continue for four more years, I’ll even consider voting for the Federal Liberals

Yeah I'm with you if we can relax rent controls in BC. It's insane for long term tenants right now.

[casper]

Originally Posted by WarrenC12

Yeah I'm with you if we can relax rent controls in BC. It's insane for long term tenants right now.

The city of Vancouver has a program in place where they wave some of the more expensive fees for unzoning a property if there are convenances written into property registration that require it to remain residential.

I think that is an excellent solution for encouraging more rental. There are two high rises near Joyce station that were originally proposed as strata but as the market become softer they have decided to go rental.

[WarrenC12]

Originally Posted by casper

The city of Vancouver has a program in place where they wave some of the more expensive fees for unzoning a property if there are convenances written into property registration that require it to remain residential.

I think that is an excellent solution for encouraging more rental. There are two high rises near Joyce station that were originally proposed as strata but as the market become softer they have decided to go rental.

Sure but my point was that long term renters are currently paying way under market rent. They could have landlords getting hit with higher interest costs and no way to increase their rent to market levels.

I'm in this boat except not worried about payments. Profit dropping every year, my tenant is paying about 60% of the current market rate.

[Coldrsx]

Housing as an asset class/commodity needs to be addressed first before any of this really matters.

[Wigs]

Originally Posted by Coldrsx

Housing as an asset class/commodity needs to be addressed first before any of this really matters.

I agree.
Canada put a lot of eggs into the Real estate speculation basket and then some Canadians are surprised the bubble has finally popped.

[thewave46]

Originally Posted by casper

Hosing starts in Canada are around 277,000 per year. Average number of people per household in Canada is around. 2.5

We should be able to accommodate 682k newcomers per year.

Uh, great.

Anything going to arrest the decline of the average household size, or account for the domestic side of things? Those born in Canada from 1995-2005 are now in, or approaching the age of going out into the world with home ownership probably on their minds. The number born per year was 330-370k per year for that timespan. Even pairing them off and rounding down means we are at 165k residences.

Sure, some residences will become available, but if we are not at peak household formation, we are not far off.

[thewave46]

Originally Posted by hipster duck

Yikes. Central planning mindset at its finest.

There are 39 million Canadians and they need slightly less than two shoes on average each.

Thus, 75 million shoes should be adequate for all Canadian footwear needs.

[casper]

Originally Posted by thewave46

Uh, great.

Anything going to arrest the decline of the average household size, or account for the domestic side of things? Those born in Canada from 1995-2005 are now in, or approaching the age of going out into the world with home ownership probably on their minds. The number born per year was 330-370k per year for that timespan. Even pairing them off and rounding down means we are at 165k residences.

Sure, some residences will become available, but if we are not at peak household formation, we are not far off.

Canada has 10.21 births/1,000 population and 8.08 deaths/1,000 population.

Easily account for with the higher than require rate of housing starts.

[theman23]

Honestly if you were to listen to Casper talk, you’d think that Canada and that Vancouver in particular was some sort of international model for housing policy.

[thewave46]

Originally Posted by casper

Canada has 10.21 births/1,000 population and 8.08 deaths/1,000 population.

Easily account for with the higher than require rate of housing starts.

Right, and newborns tend to not require purchasing their own home immediately.

It is the 20-30 year old people (curse that growing up lag) and the fact that not every death means a house is available.

[casper]

Originally Posted by theman23

Honestly if you were to listen to Casper talk, you’d think that Canada and that Vancouver in particular was some sort of international model for housing policy.

I actually think Vancouver screwed up on housing. Especially in the 80s and 90s there was a reluctance to densify the city. If there is any city that has done a good job on housing I would say it is Montreal.

[casper]

Originally Posted by thewave46

There are 39 million Canadians and they need slightly less than two shoes on average each.

Thus, 75 million shoes should be adequate for all Canadian footwear needs.

Now that is silly. We are Canadians after all.

You need a pair of winter shoes, culturally appropriate traditional shoes "Mocassins", colonial culture appropriate shoes "dress shoes" and runners. Replacement rate once every two years.

I think you have underestimated your shoe production by 50%. That is dangerous as it may cause a revolt against the central planning committe.... .

Many of the protesters will lack shoes so they can't run very fast. That is the one saving grace.

[swimmer_spe]

Originally Posted by casper

I actually think Vancouver screwed up on housing. Especially in the 80s and 90s there was a reluctance to densify the city. If there is any city that has done a good job on housing I would say it is Montreal.

Would that be why housing that has traditionally been lower than most of the other larger cities?

[yaletown_fella]

Originally Posted by WarrenC12

What is a "YIMBY wokester". Immigration will spur demand, and yes we already have a lack of supply. What should we do? Freeze immigration or build more homes?

A substantial level of immigration is necessary to offset the sharply declining birthrates . There needs to be enough young workers to keep the countrys' grid and health care system functional so it can meet the demands of the aging population .

So the answer is to build more homes and slash local zoning/approval processes and devlopment charges. Slashing back/Rolling back development charges in cities like Toronto and instead raising the general property levy is a start. Places to Grow Act is also unreasonable and contributes to artificial scarcity of land/inflated land valuation.