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Originally Posted by opendoor
That's what tends to happen, and it already is to some extent. Real Property prices in Canada are barely above (up about 5%) where they were 7 years ago in mid-2017. And once you account for real wage growth, they're not up at all, really.
And that's what happened in the past; housing was cheap in the '90s and early 00s not because there were dramatic drops, but because prices stayed stagnant while inflation and real wage growth made them more affordable.
It's also interesting how people blame the current federal government for housing prices, but like I said, prices aren't really any higher than 7 years ago. The biggest sustained run ups in real property prices in recent decades were 2001-2008 and 2009-2017:
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It's fairly easy to manipulate graphs to make trends look one way or another. There's no denying that there was a dramatic uptick in housing prices around 2020 though:
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As of August 2023, the national average home price was $750,100 — a negligible $2,900 increase from a year ago, but a $179,100 jump from the summer of 2020.
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https://storeys.com/canada-home-price-change-2020-2023/
It's the combination of these increases with stagnating wages and vastly increasing interest payments that are creating the crunch, in what was already a difficult market to begin with.
The Liberals themselves are acknowledging that it's an issue, making building 3.9 million more homes by 2031 a key part of their campaign:
https://www.ctvnews.ca/politics/from...-you-1.6849339
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According to the budget, the Liberals are laying out “a bold strategy to unlock 3.9 million new homes by 2031,” using a string of measures with spending spread out over the next several years.
“Because the best way to make home prices more affordable is to increase supply—and quickly,” the budget reads.
Some of those measures include a plan to convert public lands into housing, a new Canada Housing Infrastructure Fund, and a top-up to the Apartment Construction Loan Program.
According to the Canada Mortgage and Housing Corporation, Canada needs to build 3.5 million homes by 2030 to restore affordability.
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The Liberals are also proposing increasing capital gains taxes on amounts over $250k earned in a year.
All of this is great. However, it also highlights that the existing government didn't do enough about these issues prior to now.