Quote:
Originally Posted by Nashe
Any additional charges to landlords will be passed on to tenants.
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Just as a real life example, right now in the heart of the downtown of a midsized Canadian city I have 47 empty units (ranging from 4-br apts to SRO units) AND vacant land / surface parkings where current zoning (which the City is working on densifying further right now) would allow, right now and without any possibility of NIMBYs blocking anything, a bare absolutely-NIMBY-proof minimum of 201 new units in new buildings of 7 to 9 stories. (In reality, I could likely obtain the green light to build more units, but it’s what could be done right now any day on those ready-to-build sites.)
The main reason for that situation is that property taxes in Canada are very low so holding real estate and waiting for the passage of time, while avoiding the hassle of tenants, is actually a good strategy.
If my property taxes were quintupled tomorrow / we moved to a LVT model, it would light a fire under my ass and I’d quickly rent everything and build a few buildings, or immediately sell to someone who would.
The Montclair house we’ve been discussing as an example, I’d just NEVER be holding that idly; too costly proportionally.
And consider, I’m just a small fish, imagine this phenomenon at the scale of the country… I’m far from the only one sitting on urban Canadian real estate banking on rising land values. If it makes sense for me, it also makes sense for tons of other investors.