Quote:
Originally Posted by Mathgod
I'm going to assume you are correct.
In any event, I'm in favor of a tax that makes it less attractive for anyone (be it a person or a company, domestic or foreign) to own multiple properties, without being onerous on those who only own the one they live in. What are your thoughts on the idea?
Building new homes to increase supply must be a part of any solution to this housing crisis. But this alone won't solve it. The crisis likely won't subside as long as deep-pocketed investors see the real estate market as a way to make an easy buck.
|
I think that's a fair position. I don't agree but I understand that too many investors makes purchasing more difficult for home owners.
They however also play an important role in creating supply.
One important element you should consider is how vital investors are for the creation of new homes.
Particularly large condo developments like we see a lot of in Vancouver and Toronto; they can't get built without enough investors buying.
Those developments need about 60% presold to get construction financing and get built; that's not a number feasible by end users alone.
Most end users don't want to wait 3-5 year for the construction of these towers, so investors always make up the required purchasers to get to those construction financing thresholds.
Then when the condos are finished, they become rental supply or get resold to end users (home supply).
Like it or not, investors are vital to the cycle of home supply and rental supply.