Quote:
Originally Posted by opendoor
Canada already builds more units than almost anywhere in the world. We're building at a per capita rate that's about 40% faster than the US and UK, and about twice as fast as Germany. And we have essentially the lowest housing overcrowding in the world based on OECD data (meaning that existing stock likely isn't being used to its potential).
And if you're waiting for developers to eat into their own profits by driving down housing costs through over-building, you're going to be waiting a while. Every single time the housing market softens, housing starts drop to compensate. And the idea that there's this unused capacity to build faster (i.e. tradespeople, investment dollars, etc.) isn't based in reality. Even maintaining the current level of tradespeople will be tough enough given the average age of them.
If you want more affordable housing, a recession is really the only answer. Basically every time the mortgage payment to income ratio has gotten this high (and it has several times in the past), an economic downturn followed shortly after and sorted things out.
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I got to say, this is the most wildly out of touch response I have seen on the housing subject. The income to payment ratio is one thing, but the income to down payment ratio is completely out of control. There is now an entire generation of Canadians used to housing insecurity.
We have a shortfall of 3.5M units. We have an economy built on a shaky foundation of property changing hands. We could not afford a recession. For one thing, it would destroy the economy.
But also, what kind of recession? The Canadian property market has weathered Covid and high interest rates. The market is already bouncing back in Vancouver and Toronto, but starts continue to decrease.
The entire model is broken and will require the same type of fix that Japan faced in the late 90s. We have to change the way our cities are governed and built.