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

[Innsertnamehere]

Originally Posted by hipster duck

The data does back that up (Original G&M article for those who have subscriptions).

Also, think of the jobs that were formed downtown vs. in the suburbs. Downtown jobs are msotly well-paid, professional FIRE type jobs. Suburban job growth was mostly from warehouse and fulfillment centre workers getting paid $20/hour.

Of course there are more white collar jobs in the suburbs than downtown, but there is no net growth in these types of jobs in the suburbs. Just look at commercial real estate forecasts for suburban office parks.

Anyway, my point is that you can't solve the GTA's housing issues by removing the greenbelt and building sprawl. You're always presenting that as some kind of panacea.

I'll agree with you that we are not building enough freehold ground-oriented housing to meet true demand (not some "would you prefer a SFH over a condo?" straw poll question that doesn't present the added costs and other trade-offs). But in a region like Toronto, which is growing by 200k/year; where the average household size is 2.4 and shrinking; where a 50% drop in prices (like FL in 2008) would still leave SFH costing over $600,000; where the cost of building a stick frame home is probably north of $200/ft2 and where the construction industry has pivoted over the past twenty years to a labour force that's oriented around building reinforced concrete highrises, I really don't think that building sprawl is going to solve enough of the housing crisis to make up for its costs.

Like any complex problem - no one solution will fix it all.

A big reason ground related housing costs have gone nuts is because of government policy though.

Generally it can be entirely blamed on overregulation - we need deregulation of apartment construction, but we also need deregulation of ground related housing construction.

Right now we've got a system which makes ground related housing effectively illegal, and then turns around and places heavy taxes and restrictions on high-density housing forms too. It's a recipe for disaster.

[lio45]

Originally Posted by Innsertnamehere

40% real estate price drops are possible, yes. But not likely from interest rate hikes alone.

Look south of the border. Even Austin, the posterchild for a supply-unconstrained, high-growth metro, has seen prices drop "only" 18% from pandemic highs, despite US mortgage rates generally actually increasing more than Canadian mortgages did. That's more the range you would expect from such a rapid interest rate hike, as it it takes time for markets to adjust.

US real estate is somewhat shielded from interest rate variations, as rates there are 100% fixed for the entire amortization of the mortgage. This makes their market a lot more inelastic than Canada’s. It’s normal that real estate prices there would be much less sensitive to rate changes — most people by far just aren’t impacted.

[SpongeG]

A third of B.C. residents are considering leaving the province: poll

Kraig Krause
CTV News Vancouver Journalist

Updated June 10, 2024

One-in-three British Columbians are seriously considering leaving the province for more affordable housing, according to a new survey.

Angus Reid Institute conducted the study and found that half of 18- to 34-year-olds and more than two-in-five 35- to 54-year-olds say they are seriously thinking of leaving the province because of the cost of housing.

The Angus Reid study found figure number plummeted for those over the age of 55, with 40 per cent of both men and women saying they are strongly opposed to leaving.

Vancouver, Burnaby, Victoria, and Kelowna all rank among the 12 most expensive cities to rent in Canada, while purchase prices follow a similar trend, according to the Angus Reid Institute.

...

https://bc.ctvnews.ca/a-third-of-b-c...poll-1.6920431

[chowhou]

One of my friends has been "seriously considering" quitting his job for the past 5 years.

Actions speak louder than words and BC's population keeps increasing. I wonder what sort of numbers you get when you poll how many people "seriously consider" going to the gym, but don't?

[MonkeyRonin]

Originally Posted by chowhou

Actions speak louder than words and BC's population keeps increasing. I wonder what sort of numbers you get when you poll how many people "seriously consider" going to the gym, but don't?

Granted, it's only growing because of federal immigration policy. BC otherwise has negative - and accelerating - interprovincial growth.

Obviously, most of those of those people won't actually leave; but sure, half of a province's young people wanting to leave is totally normal and everything is fine. Nothing to see here folks.

[Changing City]

Originally Posted by MonkeyRonin

Obviously, most of those of those people won't actually leave; but sure, half of a province's young people wanting to leave is totally normal and everything is fine. Nothing to see here folks.

If enough of them leave, that presumably would mean rents would fall as the vacancy rate would increase? 40+% of Ontario graduates are apparently thinking of leaving that province too. Maybe that's already happening? Rentals.ca say Toronto and Vancouver rents fell in the past year.

[ssiguy]

Originally Posted by chowhou

One of my friends has been "seriously considering" quitting his job for the past 5 years.

Actions speak louder than words and BC's population keeps increasing. I wonder what sort of numbers you get when you poll how many people "seriously consider" going to the gym, but don't?

As MonkeyRonin stated, BC is only growing due to immigration. BC & NFLD are the only 2 provinces to have both negative interprovincial migration and negative natural growth rates and BC has the lowest birth rate in the country.

One also have to remember that it's not just the total number of people that may want to move but also the demographics of them. Someone older who has paid their mortgage off or a well healed immigrant, the cost of housing is not much of an issue but for younger people fresh out of school or couples wanting to start a family, it's a very big issue. I think most young people do not "want" to leave BC but rather fell like they are "forced" to.

[lio45]

For what it's worth, Quebec PM Legault this week met with Federal PM Trudeau and in the context of this ongoing negotiation with the Feds about immigration, declared that the housing crisis is 100% due to massive immigration:

https://www.journaldequebec.com/2024...750-m-a-quebec

Sounds like Legault isn't a Flat Earther!

(I think Marc Miller has released a Supply-And-Demand-Denying statement in response, from what I've heard, but I haven't yet seen the details.)

[Build.It]

Originally Posted by hipster duck

Also, think of the jobs that were formed downtown vs. in the suburbs. Downtown jobs are msotly well-paid, professional FIRE type jobs. Suburban job growth was mostly from warehouse and fulfillment centre workers getting paid $20/hour.
...

Anyway, my point is that you can't solve the GTA's housing issues by removing the greenbelt and building sprawl. You're always presenting that as some kind of panacea.

Claiming that most downtown jobs are FIRE type is quite an exaggeration. Certain jobs (legal, accounting, finance sectors) sure, but most downtown jobs are just jobs.

And removing the greenbelt won't solve all our problems, but it is an incredibly important step we need to take. The sooner people realize that the better. Greenbelts are not normal. There isn't a single healthy, growing, affordable city in the world that has a Greenbelt around it.

Toronto (GTA) is a decent place to live, but it isn't even close to good enough (low wages, shitty weather) to justify $1.5M detached houses. The only reason they cost that much is because of the greenbelt and places to grow acts.

And finally, even if your assertion was true, that most job growth in the 905 was from lower wage jobs, that doesn't change the fact the 905 has grown in population, and these people need to live somewhere. Having arbitrary pointless density rules that cities need to follow, and locking 50km of land in all directions out of development, means that these people need to compete for ever-scarcer homes.

I'm well aware that the greenbelt isn't everything, but it is the lowest hanging fruit, and the easiest one to solve.

We also need to overhaul the LTB (remove rent control, allow landlords to evict tenants for non payment), put pressure on cities to approve development apps faster, and punish cities that use the housing crisis as an excuse to jack up permit fees.

It is really really simple:
- let developers build and sell what there is demand for in the market
- let landlords evict tenants who don't pay
- people need to pay their fair share for common resources (property taxes)

Do that and the housing crisis will be a bad memory in 10 years.

[lio45]

Originally Posted by MonkeyRonin

... but sure, half of a province's young people wanting to leave is totally normal and everything is fine. Nothing to see here folks.

Exactly. "Half the people officially wanting to decamp for greener pastures if they have the opportunity is perfectly normal, no problem there!"

I'd also point out that it's possible for ANY First World jurisdiction to grow, by simply opening its gates to the billions who are in the poorest countries of the planet; out of a pool of billions you're bound to have millions of New Suckers accepting your crappy bargain even if the take rate for it is like 0.1%.

It doesn't mean anything about desirability (well, technically, it means something: that that location is more desirable than the source countries of these immigrants, but that's a super low bar if we're only looking at developed countries).

[Acajack]

Originally Posted by lio45

Exactly. "Half the people officially wanting to decamp for greener pastures if they have the opportunity is perfectly normal, no problem there!"

I'd also point out that it's possible for ANY First World jurisdiction to grow, by simply opening its gates to the billions who are in the poorest countries of the planet; out of a pool of billions you're bound to have millions of New Suckers accepting your crappy bargain even if the take rate for it is like 0.1%.

It doesn't mean anything about desirability (well, technically, it means something: that that location is more desirable than the source countries of these immigrants, but that's a super low bar if we're only looking at developed countries).

It's like a woman who sleeps with any guy that pays the slightest bit of attention to her and who has a super high body count, claiming that this is hard evidence of her superior beauty.

[lio45]

Originally Posted by Acajack

It's like a woman who sleeps with any guy that pays the slightest bit of attention to her and who has a super high body count, claiming that this is hard evidence of her superior beauty.

Excellent analogy, and it works fully too, because in her case it does at least prove a little bit of something attraction-wise: that she's not so extraordinarily repulsive that men in general would run away unless paid, which is also what it proves in Canada's case: that it's at least a slightly less shitty place than the source countries of these immigrants, by definition.

[Acajack]

Originally Posted by lio45

Excellent analogy, and it works fully too, because in her case it does at least prove a little bit of something attraction-wise: that she's not so extraordinarily repulsive that men in general would run away unless paid, which is also what it proves in Canada's case: that it's at least a slightly less shitty place than the source countries of these immigrants, by definition.

Or at least better than one's hand or an inflatable doll!

[YOWetal]

Originally Posted by Acajack

It's like a woman who sleeps with any guy that pays the slightest bit of attention to her and who has a super high body count, claiming that this is hard evidence of her superior beauty.

To stretch the analogy further. Even them all being super rich doesn't prove much. We could probably bring in 1 million rich Asians who would come pay little taxes and decamp after they get citizenship. Proves nothing to our actual desireablity.

[whatnext]

Originally Posted by chowhou

One of my friends has been "seriously considering" quitting his job for the past 5 years.

Actions speak louder than words and BC's population keeps increasing. I wonder what sort of numbers you get when you poll how many people "seriously consider" going to the gym, but don't?

It’s hard if you grew up here and have friends and family here. I mentioned somewhere that I had two coworkers decamp for Edmonton right after Covid. Both had just started families and saw how much more housing they could get for less money and the employment opportunities were good. However both were originally from Ontario and didn’t have family ties to B.C.

[SpongeG]

has anyone moved to another province and had problems. I have a friend born and raised in BC and he and his partner sold up their BC home in 2022 and moved to Winnipeg where they could buy a house and not have to pay off any mortage, it cost half of what their house was in BC.

Anyway he found that wages were lower in Manitoba and none of the places he applied seemed to acknowledge his years working in BC and wanted to start him from the beginning, which is understandable but he was quite upset about it. He works in Hospital/health care. Also said that car insurance was much more of a cost there and felt like it was a bad decision to move despite the more affordable housing.

Do people like the ones surveyed look into those kind of things before leaving one province for another?

[GenWhy?]

Originally Posted by SpongeG

has anyone moved to another province and had problems. I have a friend born and raised in BC and he and his partner sold up their BC home in 2022 and moved to Winnipeg where they could buy a house and not have to pay off any mortage, it cost half of what their house was in BC.

Anyway he found that wages were lower in Manitoba and none of the places he applied seemed to acknowledge his years working in BC and wanted to start him from the beginning, which is understandable but he was quite upset about it. He works in Hospital/health care. Also said that car insurance was much more of a cost there and felt like it was a bad decision to move despite the more affordable housing.

Do people like the ones surveyed look into those kind of things before leaving one province for another?

Reminds me of that story of the woman who moved from Toronto to "Edmonton" (actually Leduc or Nisku) and she complained how rural it was and I think she moved back to Ontario.

[MonkeyRonin]

Originally Posted by SpongeG

has anyone moved to another province and had problems. I have a friend born and raised in BC and he and his partner sold up their BC home in 2022 and moved to Winnipeg where they could buy a house and not have to pay off any mortage, it cost half of what their house was in BC.

Anyway he found that wages were lower in Manitoba and none of the places he applied seemed to acknowledge his years working in BC and wanted to start him from the beginning, which is understandable but he was quite upset about it. He works in Hospital/health care. Also said that car insurance was much more of a cost there and felt like it was a bad decision to move despite the more affordable housing.

Do people like the ones surveyed look into those kind of things before leaving one province for another?

Stuff like this is probably the biggest practical barrier to interprovincial migration. There are a number of professional designations and accreditations that are province-specific, and therefore essentially lost by moving. Apparently, Manitoba can't trust a nurse or an engineer from neighbouring Saskatchewan, or vice versa. Too foreign to be compatible I guess.

After to moving to BC, it was also quite surprising seeing the number of job postings in the Architecture/Design industry that specifically listed BC or even Vancouver-specific experience as a requirement. I still had no trouble getting a job here with Ontario experience, but I don't think I'd ever even seen anything like that in Toronto.

[whatnext]

Originally Posted by MonkeyRonin

Stuff like this is probably the biggest practical barrier to interprovincial migration. There are a number of professional designations and accreditations that are province-specific, and therefore essentially lost by moving. Apparently, Manitoba can't trust a nurse or an engineer from neighbouring Saskatchewan, or vice versa. Too foreign to be compatible I guess.

After to moving to BC, it was also quite surprising seeing the number of job postings in the Architecture/Design industry that specifically listed BC or even Vancouver-specific experience as a requirement. I still had no trouble getting a job here with Ontario experience, but I don't think I'd ever even seen anything like that in Toronto.

Yes, all that is totally ridiculous. It is all the same country for pity's sake!

[YOWetal]

Originally Posted by whatnext

Yes, all that is totally ridiculous. It is all the same country for pity's sake!

We are a federation. So have different standards in many areas. Are many or most of the these barriers more about guild like protectionism? Most likely, but it's not true that there are no differences.