Housing Bubble II: The Quest To Build Enough Homes Where People Actually Need Them

[theman23]

Originally Posted by Nite

the 2 years of low immigration i am referring to is from April 2020 to Feb 2022 so only the first 2 months of 2022. The record numbers of immigration pretty much started right after housing peaked.

That isn’t true. By the end of 2021 we were back to growing by 420k people a year. That would have been the second highest growth number in over 30 years, second to 2019.

And again, you keep conflating housing affordability and prices. Affordability has not yet plateued.

[Build.It]

Higher rates and decreasing prices is part of how affordability will eventually be restored. In the short term it will be less affordable, as the case right now. That is the entire point of the higher rates. Make mortgage payments less affordable so that prices are forced to come down.

It only addresses one aspect of what created the problem (cheap money), but it's a start.

We still need to address all the various rules that prevent developers from building what people want at the scale that people want it. (Greenbelt, Places to Grow, NIMBYs)

Most people want to live in detached houses. The only thing stopping developers from building affordable detached houses at the scale the market desires is government. As a result, the next best thing (townhomes) get bid up, which leads to condo apartments getting bid up as well by those who can no longer afford townhomes.

This message really needs to sink in with high density urbanists. Your war against detached houses and cars (and the various policies put in place as a result) is what caused housing to become unaffordable in Canada.

[goodgrowth]

The core social/economic problem imo is that we've built physical environments that have lead to significant job clustering and density which you could probably argue is a public good yet a lot of the surrounding residential land is treated more as an exclusivity thing.

I like the term "density freeloading" because whenever somebody somebody says they don't like density how often are they in some remote rural area vs in the suburbs proximal to the benefits of density?

We are not a nation of density haters so much as a nation of density freeloaders.

[Truenorth00]

Originally Posted by Build.It

This message really needs to sink in with high density urbanists. Your war against detached houses and cars (and the various policies put in place as a result) is what caused housing to become unaffordable in Canada.

If you want more detached houses, you have two choices:

1) Substantially improved local and regional transit.

2) 2-3 hr commutes (one way) in traffic.

If you think I'm exaggerating, talk to the nutters who live in KWC or Barrie or Hamilton, a shocking percentage of whom will drive.

There's a reason developers in the 416 would build even more density if they could get away with it. Thanks to inadequate transit service, there's a lot of demand to pay more for shelter to save time.

[YOWetal]

Originally Posted by Truenorth00

If you want more detached houses, you have two choices:

1) Substantially improved local and regional transit.

2) 2-3 hr commutes (one way) in traffic.

If you think I'm exaggerating, talk to the nutters who live in KWC or Barrie or Hamilton, a shocking percentage of whom will drive.

There's a reason developers in the 416 would build even more density if they could get away with it. Thanks to inadequate transit service, there's a lot of demand to pay more for shelter to save time.

Is there anywhere providing single family homes with transit? If we look at similar sized cities with affordable SFHs/ Say Houston. They have much bigger capacity of freeways. Sure this brings other problems but the freeway network of Toronto has developed even less than transit over the last 50 years.

[Truenorth00]

Originally Posted by YOWetal

Is there anywhere providing single family homes with transit? If we look at similar sized cities with affordable SFHs/ Say Houston. They have much bigger capacity of freeways. Sure this brings other problems but the freeway network of Toronto has developed even less than transit over the last 50 years.

I'm not sure what the point of comparing to Houston is here. We aren't going to demolish neighborhoods to build 20 lane freeways. And I'm fairly sure, if our governments even tried to do that today, they'd get utterly crushed in court. So really, there's only one way out. That's massive regional rail networks and either feeder services or parking structures that cost several hundred million. It's not directly analogous. But a lot of European and Japanese exurbs are basically what our suburbs should be.

Ironically, the very people who clamour for SFD often don't want to pay the taxes associated with building that kind of infrastructure necessary to sustain the lifestyle they want. Just imagine what parking alone would cost at GO stations iif we had cost recovery for the parking Taj Mahals we build.

[whatnext]

Originally Posted by YOWetal

Is there anywhere providing single family homes with transit? If we look at similar sized cities with affordable SFHs/ Say Houston. They have much bigger capacity of freeways. Sure this brings other problems but the freeway network of Toronto has developed even less than transit over the last 50 years.

Confused…do you mean to suggest no single family home areas in Canada have good bus service?

[YOWetal]

Originally Posted by whatnext

Confused…do you mean to suggest no single family home areas in Canada have good bus service?

No I mean is it possible to deliver good transit to the point where SFHs are affordable as they can be built in a widespread area. Freeways are how you knit SFHs to a city. That and liberal planning. GTA has huge swaths of land locked out of development. Some near highways or other transport links. In some senses that is unchangable but my point is you aren't fixing affordablity with transit.

[Xelebes]

Another thing that needs to be considered is access to jobs. Like one of the things that makes Edmonton more affordable than places like Calgary is how polycentric the employment centres are. The number of people who work downtown is only 40,000. The rest are in jobs in Nisku/Airport, Yellowhead, Acheson, Refinery Row, Industrial Heartland, or otherwise commute to the Oilsands. That way, the distance to your job is not so dependent on the distance to the few employment centres. That makes SFH more possible.

The dream that you get that much more SFH out of Toronto is pretty dubious.

[lio45]

Originally Posted by Build.It

Most people want to live in detached houses. The only thing stopping developers from building affordable detached houses at the scale the market desires is government.

Incorrect. Most people would want a SFH but within easy reach of all urban amenities, and that's just impossible (which is why they're so pricy). Blanketing the countryside with exurban sprawl isn't what people want, you can't support decent transit and traffic would be a nightmare anyway.

Anyone with a bit of savings and who truly wants a SFH can easily get one. In Cartier, Ontario for example (RIP, swimmer_spe!)

I'll leave it as an exercise to the reader to figure out why most people won't choose the above solution for their housing needs ...

[Truenorth00]

Originally Posted by YOWetal

No I mean is it possible to deliver good transit to the point where SFHs are affordable as they can be built in a widespread area.

Define "good transit". Because what GO is attempting with RER is to sort of enable development in a manner you are alluding to here. Maybe the local bus won't be frequent in Oshawa. But once they get to the GO station, they'll be able to get on a train heading downtown every 15 mins and get there in half an hour. This kind of network should make it fast more convenient to live in an SFH, especially if local bus service improves alongside RER (which is also a Metrolinx mandate/goal).

Originally Posted by YOWetal

Freeways are how you knit SFHs to a city.

This applies up to a point. Pretty easy to be auto centric in an oversized suburb like Ottawa. Urban agglomerations the size of the GGH are all but impossible to develop in a manner that is extraordinarily car centric unless you did it early on and developed commute patterns that aren't very core centric (so lots of driving to business parks outside the core). And even then there's a price to pay. Houston's core is basically half parking lots.

Originally Posted by YOWetal

That and liberal planning. GTA has huge swaths of land locked out of development. Some near highways or other transport links. In some senses that is unchangable but my point is you aren't fixing affordablity with transit.

It can be done. But it requires transit planning on a level this country is not used too. Toronto would need coverage like Melbourne (as we were talking about) with RER frequencies. And the question is, who is going to pay for that. But if we ever had that level of transit coverage, in theory that would allow massive SFH growth. Uxbridge would become the new Milton. That said, if Toronto ever did something like this and will maintained its downtown centric employment/commerce model, I think most people would find that kind of a city absolutely unbearable beyond their neighborhood. Downs-Thomson paradox kinda explains that.

[Truenorth00]

Originally Posted by lio45

Incorrect. Most people would want a SFH but within easy reach of all urban amenities, and that's just impossible (which is why they're so pricy). Blanketing the countryside with exurban sprawl isn't what people want, you can't support decent transit and traffic would be a nightmare anyway.

Anyone with a bit of savings and who truly wants a SFH can easily get one. In Cartier, Ontario for example (RIP, swimmer_spe!)

I'll leave it as an exercise to the reader to figure out why most people won't choose the above solution for their housing needs ...

It's always surprising to me how many people don't understand the basic physics of the problem and how it's proximity to the core that determines $/sqft. If you want an SFH in a desirable location, you will pay more per square foot and since you want more square feet in total, the overall price will obviously be expensive.

[YOWetal]

Originally Posted by lio45

Incorrect. Most people would want a SFH but within easy reach of all urban amenities, and that's just impossible (which is why they're so pricy). Blanketing the countryside with exurban sprawl isn't what people want, you can't support decent transit and traffic would be a nightmare anyway.

Anyone with a bit of savings and who truly wants a SFH can easily get one. In Cartier, Ontario for example (RIP, swimmer_spe!)

I'll leave it as an exercise to the reader to figure out why most people won't choose the above solution for their housing needs ...

It's not impossible at all. Houston is a great example. Build wherever and however you want and the governmetn builds the highways infrastrcuture and 8 million people can mostly live in mostly affordable SFHs.

[Build.It]

I don't see how allowing more SFHs to be built would be at the expense of density in the core. If you want to go live in the core, go live in the core. If you want to live in a house, go live in a house. Let developers build what the market demands, at the price the market is willing to pay. It's really very simple.

Most people don't want to live in a shitty stacked townhouse, or wait 10 minutes for an elevator just to get out of the building in the morning.

And SFH doesn't have to mean a McMansion. What ever happened to building 1200 sqft detached houses? Most people just want a comfortable sized house, on their own land, and don't want to hear their neighbours' loud music or sex.

Nor do I see what "better transit" has to do with SFHs. Unless you mean better transit in the core so there can be more density in core, freeing up land in the suburbs...

Another thing that needs to be considered is access to jobs. Like one of the things that makes Edmonton more affordable than places like Calgary is how polycentric the employment centres are. The number of people who work downtown is only 40,000. The rest are in jobs in Nisku/Airport, Yellowhead, Acheson, Refinery Row, Industrial Heartland, or otherwise commute to the Oilsands. That way, the distance to your job is not so dependent on the distance to the few employment centres. That makes SFH more possible.

The dream that you get that much more SFH out of Toronto is pretty dubious.

And the GTA is every bit as multinodal as Edmonton ... probably even more. The GTA has an anti-development boundary around the entire metro area that spans about 50km in all directions. Edmonton does not. That is the difference.

In Edmonton developers can build whatever the market demands. In Toronto they can't - they are limited to condos, stacked towns, towns and McMansions, with not much in between.

Most people would want a SFH but within easy reach of all urban amenities, and that's just impossible (which is why they're so pricy)

Anyone with a bit of savings and who truly wants a SFH can easily get one.

You live in Quebec, where anyone who wants a SFH can easily get one. In Ontario (GGH) this is almost impossible because of the Greenbelt and Places to Grow acts. Remove these two acts and return to a free market, and you'll see how quickly affordability gets restored in the GGH, which will actually put downward pressure on the rest of the country's house prices as well.

It's always surprising to me how many people don't understand the basic physics of the problem and how it's proximity to the core that determines $/sqft. If you want an SFH in a desirable location, you will pay more per square foot and since you want more square feet in total, the overall price will obviously be expensive.

No one is disputing this. The desirable land is locked out of development for 50km in all directions. That pushes up the price of all the remaining land within the boundary. So it forces people who need more space at an affordable price to live way further out - like KW or Barrie.

[lio45]

Originally Posted by YOWetal

It's not impossible at all. Houston is a great example. Build wherever and however you want and the governmetn builds the highways infrastrcuture and 8 million people can mostly live in mostly affordable SFHs.

The U.S. has a ton of nice cities, not everyone goes to Houston, so its growth is manageable.

I don't think we can continue to import FNSs as the rate we do (our peers now being South Sudan and Syria for growth) while making sure everyone gets a SFH in the GTA, it's not realistic EVEN if government "got out of the way" and allowed a continuous blanket of subdivisions everywhere between lakes Huron, Erie and Ontario.

[lio45]

Originally Posted by Build.It

You live in Quebec, where anyone who wants a SFH can easily get one.

Amusingly, I just spoke to my sis who reiterated that she'd want a SFH but can't afford one, she's currently stuck in her Montreal condo. SFHs in Montreal are like $800k or more...

[lio45]

Originally Posted by Build.It

I don't see how allowing more SFHs to be built would be at the expense of density in the core. If you want to go live in the core, go live in the core. If you want to live in a house, go live in a house. Let developers build what the market demands, at the price the market is willing to pay. It's really very simple.

Okay, but in a free market situation, those SFHs will be far away, connected to urban areas by long drives on expensive new toll roads, and will cost a lot, if the people who'll be buying them have to pay the fair cost of their services; they won't be as cheap as you think.

[YOWetal]

Originally Posted by lio45

Amusingly, I just spoke to my sis who reiterated that she'd want a SFH but can't afford one, she's currently stuck in her Montreal condo. SFHs in Montreal are like $800k or more...

If you mean on island in a desireable neighbourhood sure. You can find move in ready SFHs in Montreal for less than $500k and $600k will get you something nice.

Originally Posted by lio45

The U.S. has a ton of nice cities, not everyone goes to Houston, so its growth is manageable.

I don't think we can continue to import FNSs as the rate we do (our peers now being South Sudan and Syria for growth) while making sure everyone gets a SFH in the GTA, it's not realistic EVEN if government "got out of the way" and allowed a continuous blanket of subdivisions everywhere between lakes Huron, Erie and Ontario.

Houston is growing about as fast as Toronto. As someone said it's about greenbelt, Places to Grow Act etc. but I also think underappreciated is the decision to stop building freeways. This has made the downtown more liveable and preserved neigbourhoods and overall probably a good decision but the idea of everyone having a SFH is over. In most US cities it is still possible.

[hipster duck]

Originally Posted by YOWetal

It's not impossible at all. Houston is a great example. Build wherever and however you want and the governmetn builds the highways infrastrcuture and 8 million people can mostly live in mostly affordable SFHs.

Putting everything else aside, Toronto is fundamentally not like Houston because all of the job growth in the past 15 years for professional, white collar jobs - the kind that people who buy single family homes must have, even in cheap real estate markets - is downtown. Even with 2 day WFH policies, people have to find a way to get downtown, and there will be no increase in road capacity into the downtown core of Toronto, full stop. The more you build SFH, the more you have super-commuters.

Even if you trashed the greenbelt, the closest farmland that you can build SFH on that aren't already deeded are about 40 km from downtown as the crow flies. Getting to downtown even with sped up transit will still put you at a disadvantage to people who live closer to the core. Centrality really matters in Toronto in a way that it doesn't in Houston.

Houston's downtown is kind of stagnant. It has pretty much the same number of jobs it did 30 years ago. The skyline is more or less the same as it was back then, too. White collar job growth in Houston is mostly all on the suburban fringe, like to the north along the Grand Parkway, close to where the airport is. The detached houses built in greenfield subdivisions in these areas are more attractive simply because they're closer to good jobs than they would be in Toronto. For a while, Toronto kind of went this way: there was a lot of white collar job growth in the 90s and early 2000s in places like East Beaver Creek (Markham/Richmond Hill) and in Meadowvale in Mississauga. Then, after the 2006 census, downtown really took off, the suburban office market went bust, and almost all of the job growth in the suburbs has mostly been blue collar warehouse/logistics kind of stuff. These people are essential, and there's a lot of them, but they don't buy detached houses, and they don't buy detached houses even in Houston.

[Innsertnamehere]

The biggest greenbelt removal and reversal made by Doug was to remove a good chunk of greenbelt area for housing development 25-30km from Downtown. There are lots of areas which could be developed which aren't out in Caledon or Milton, particularly on the east end of the city.

Toronto's GO expansion program is also going to be a massive gamechanger in terms of employment access to the downtown from the suburbs, especially combined with a 2-day a week model.

One benefit Houston has is that it's not on a major body of water - sprawl can go in all directions.

Toronto by nature of being on a lake, makes basically 1/2 of the land within easy access of downtown completely unusable. This alone impacts prices.

The Toronto Market is one which will never be able to be Houston-like in sprawl, but that doesn't mean the current model works either. It'll likely never be a city where a nurse or a teacher can afford a detached home - but that doesn't mean that detached homes need to be reserved for senior-executive VPs either. If we allowed an extra 10,000 detached homes to be built, it means that 10,000 more families could afford a detached home who would otherwise be living in something else, and would give 10,000 townhouses for the income brackets below them, and so on.