Quote:
Originally Posted by Azure
My original question was also ignored.
Do people honestly believe Toronto & Vancouver housing prices were driven by actual demand and not external shady circumstances?
Why is Vancouver SO much higher than Montreal? Calgary? And why has it been higher for so much longer than other cities in Canada? Where is the money coming from that is driving that insane demand?
|
It's both. Investors only enter a market in large numbers when they think it's profitable. There has to be high demand to create the circumstances for investors to profit.
The idea that, long term, investors alone will result in a market is false. If that were the case, why weren't they snapping up all the property in Regina? Because they will only profit from investing if its in a market where natural demand is likely to sustain investment.
And yes, the demand for housing is extremely high in both Vancouver and Toronto. My own experience buying a home in Jan-Feb of 2021 was that every house would have dozens and dozens of people viewing with 10-20 offers made the next day. The vast majority of people I saw viewing were people aged 30-45, many with a young kid(s) and many with their own parents.
Vancouver and Toronto both simply do not have enough housing units to accommodate their populations. Vancouver and Toronto are both cities that have more demand than other cities in Canada. They have also not done anything to accommodate their low housing supply for several decades, and the problems are boiling over.
Vancouver also has horrid zoning for a city of its size. Land is kept artificially scarce via permitting, the ALR, and Nymbyism. On top of that, they do have their own geographic restrictions, being surrounded by ocean and mountains. They can't just build a new suburb, the way Calgary can.
Montreal is a bit of an exception, as they have much better zoning and city structure than either Toronto or Vancouver. Montreal is a high demand city, but not as in demand as Vancouver and Toronto.
You can alleviate some pressure by removing investors and launderers from the equation, but things are far beyond that now. There's not enough housing full stop.