Population and Housing

[plam]

I have a good friend that works in a law office - it's strictly dealing with real estate mostly.

She was saying out cities are addicted to these high land transfer tax, every time there is a sell. It's common to see they taxes in excess of $40,000 now.

Had me thinking that, while the government (all levels) speak lip service regarding affordable housing, everything they do prevents it. Why? They want the money.

Not sure what a solution to that is -- but most likely they'd need to figure out a tax scheme from elsewhere.

It's out of the hands of municipal governments since they don't get to choose which tax tools they have. It's really the province that needs to reform this.

It's not just that they need revenue. It's also unpopular with the voter base to crash peoples' #1 assets (sigh).

[tomh009]

I have a good friend that works in a law office - it's strictly dealing with real estate mostly.

She was saying out cities are addicted to these high land transfer tax, every time there is a sell. It's common to see they taxes in excess of $40,000 now.

Had me thinking that, while the government (all levels) speak lip service regarding affordable housing, everything they do prevents it. Why? They want the money.

Not sure what a solution to that is -- but most likely they'd need to figure out a tax scheme from elsewhere.

In Ontario, land transfer tax is provincial, and roughly 1%. Toronto (and only Toronto, at least in this province) adds the same amount on top. So, in Toronto, that $40K land transfer tax would be on a $2M property.

On the more affordable housing scale, the land transfer tax on a $400K townhouse or condo (in our region) would be roughly $4500. Not great, but it's not as massive as the $40K quote makes it seem.

[ac3r]

Housing minister: Canada needs temporary ban on foreign buyers to ease affordability crisis: https://nationalpost.com/news/politics/b...ba52f37bd/

[plam]

Housing minister: Canada needs temporary ban on foreign buyers to ease affordability crisis: https://nationalpost.com/news/politics/b...ba52f37bd/

Well, the foreign buyer ban totally didn't work in NZ (prices continued to rise through lockdown but may be moderating now), but it's also a really different cultural context with respect to investing. It seems that everyone middle-class and up wants to own as many rental properties as possible because they don't really know how to invest their money (the correct answer is: low-fee passive all-market funds e.g. Vanguard ETFs). In the 80s everyone seems to have bought individual stocks and then the NZ market crashed and they're still leery of buying stocks. So a lot of people are amateur landlords, many more there than in Canada, at least with respect to people I talk to.

Also, I've thought that if you are actually renting out your investment property, you're not decreasing the amount of inventory available on the market. (There should be better renter protections, but that's another story). So, vacant home tax? Sure. Banning foreign buyers? Meh.

[Bytor]

Housing minister: Canada needs temporary ban on foreign buyers to ease affordability crisis: https://nationalpost.com/news/politics/b...ba52f37bd/

Well, the foreign buyer ban totally didn't work in NZ (prices continued to rise through lockdown but may be moderating now), but it's also a really different cultural context with respect to investing. It seems that everyone middle-class and up wants to own as many rental properties as possible because they don't really know how to invest their money (the correct answer is: low-fee passive all-market funds e.g. Vanguard ETFs). In the 80s everyone seems to have bought individual stocks and then the NZ market crashed and they're still leery of buying stocks. So a lot of people are amateur landlords, many more there than in Canada, at least with respect to people I talk to.

Also, I've thought that if you are actually renting out your investment property, you're not decreasing the amount of inventory available on the market. (There should be better renter protections, but that's another story). So, vacant home tax? Sure. Banning foreign buyers? Meh.

If you go and look things up, though, foreign housing ownership is less than 5% in any Canadian market. Vancouver is the worse at 4.7%, Toronto is something like 3% and Montreal is 2-ish %. So the whole "ban foreign owners" seems to me to be nothing more than xenophobia and bigotry.

[plam]

If you go and look things up, though, foreign housing ownership is less than 5% in any Canadian market. Vancouver is the worse at 4.7%, Toronto is something like 3% and Montreal is 2-ish %. So the whole "ban foreign owners" seems to me to be nothing more than xenophobia and bigotry.

Often is!

[jeffster]

If you go and look things up, though, foreign housing ownership is less than 5% in any Canadian market. Vancouver is the worse at 4.7%, Toronto is something like 3% and Montreal is 2-ish %. So the whole "ban foreign owners" seems to me to be nothing more than xenophobia and bigotry.

Absolutely, and if it was the CPC that did this, it would be called out exactly as xenophobia and bigotry, because it would be true. But since it's the LPC doing this, they can do with without being questioned, especially the media will be silent.

They're using a popular opinion by doing this, and they can say 'we tried', meanwhile, prices will continue to go up, and more and more people will be pushed closer to being homeless -- that, or shacking up with the 'rents the rest of their lives. The government doesn't have the balls to do what is really needed, because by doing so, they stop funding their own party interests and their special interest groups. Follow the money, folks. It's nothing more than lining the pockets of the elite, and that group continues to be protected.

[plam]

If you go and look things up, though, foreign housing ownership is less than 5% in any Canadian market. Vancouver is the worse at 4.7%, Toronto is something like 3% and Montreal is 2-ish %. So the whole "ban foreign owners" seems to me to be nothing more than xenophobia and bigotry.

Absolutely, and if it was the CPC that did this, it would be called out exactly as xenophobia and bigotry, because it would be true. But since it's the LPC doing this, they can do with without being questioned, especially the media will be silent.

They're using a popular opinion by doing this, and they can say 'we tried', meanwhile, prices will continue to go up, and more and more people will be pushed closer to being homeless -- that, or shacking up with the 'rents the rest of their lives. The government doesn't have the balls to do what is really needed, because by doing so, they stop funding their own party interests and their special interest groups. Follow the money, folks. It's nothing more than lining the pockets of the elite, and that group continues to be protected.

It's also the case that very few governments in the Anglosphere have been able to solve their housing crisis yet. People are trying different things. Interest rates don't help.

[ac3r]

House price hotbed: Cost of a detached home in Waterloo Region rising faster than in almost all other major Canadian markets: https://www.therecord.com/business/real-...rkets.html

[Acitta]

This is U.S. centric, but applies just about anywhere. I know that many here would agree with this point of view. 

Stop Fetishizing Old Homes
"Whatever your aesthetic preferences, new construction is better on nearly every conceivable measure."

[Rainrider22]

Good article, thanks for sharing... It makes you think a bit differently for sure..

[westwardloo]

While I agree with some of the points this article is trying to make. I know my house 1949 is poorly insulated and definitely has air leakage issues. I have been trying to get a home energy audit for months so I can get rebates to fix this. Having said this personally I prefer the look and built environment of neighbourhoods built before the 1960's. It seems somewhere along the way cities just handed developers all the power in deciding how our city would be laid out. Suburbs from 1960 on were layed out to maximize developers profits but leave a cold disjointed built environment. One developers subdivision rarely connects to the next developers subdivision expect through an artillery's road. No commercial street has been developed, just car centric strip malls and power centers. Where as my neighourhood layout is in a grid pattern that connects various different developers properties together. There is a mix of single family, walk ups, midrises, (even a few towers thanks to the 1960's) and has small commercial shops scattered throughout. I rarely have to use my car to do my day to day errands. 

I will also say the level of detail and finishes in the older homes is way above anything you would find in a new tract home builds. I work closely with some Ontario housing developers and seeing how the sausage is made I would never buy a new build. The pride in workmanship just is not there anymore.  Trim, cabinets, countertops, appliances, plumbing features, doors, and floors are all the cheapest possible option. You are paying for the land not the house when you purchase one of these homes. An old home can be renovated to meet the same level of comfort you find in the new homes. Also open floor plans are overrated and make homes feel small, another personal opinion.  

In terms of accessibility I will agree that new midrise building are built to provide housing options for people with mobility needs which is a good thing. Although this does add a substantial cost to construction and maintenance of  buildings. I think it is important we build an inclusive built environment, but I do feel like we have lost the ability sprinkle in additional housing supply in new subdivisions with 3-4 storey walkups. I will also add that you rarely see bungalows built in new subdivisions, because they are just not profitable for the developer.

[ijmorlan]

While I agree with some of the points this article is trying to make. I know my house 1949 is poorly insulated and definitely has air leakage issues. I have been trying to get a home energy audit for months so I can get rebates to fix this. Having said this personally I prefer the look and built environment of neighbourhoods built before the 1960's. It seems somewhere along the way cities just handed developers all the power in deciding how our city would be laid out. Suburbs from 1960 on were layed out to maximize developers profits but leave a cold disjointed built environment. One developers subdivision rarely connects to the next developers subdivision expect through an artillery's road. No commercial street has been developed, just car centric strip malls and power centers. Where as my neighourhood layout is in a grid pattern that connects various different developers properties together. There is a mix of single family, walk ups, midrises, (even a few towers thanks to the 1960's) and has small commercial shops scattered throughout. I rarely have to use my car to do my day to day errands. 

I’m pretty sure you have this backward. The older parts of cities were built when basically anybody could build anything anywhere. Zoning is a 20th Century invention.

I remember seeing a billboard advertising for sale the vacant property on which it sat. I think this was on Fischer-Hallman Road in south Kitchener, some years ago; the property is probably now a recently-developed one. The billboard said something like “land available for strip mall”. I remember thinking, how does the seller know that a strip mall is right there? Of course the answer is that is what it is zoned for. Doesn’t matter if the owner thinks apartments or an enclosed mall or one big store or commercial above retail or whatever else will be more useful to people in that location — it’s zoned for a strip mall and if it is to be built as anything else, a big complicated process that can realistically only be navigated by a professional developer needs to take place.

I theorize that almost all development is now done by professionals who fundamentally are in the development business; whereas previously a significant amount was done by existing property owners who actually cared about their property. For example, the home owner who builds a house next to them, or rents out their main floor as a store and moves upstairs, or builds a store right in front of the house, or whatever. Now an owner who wants to do something interesting or creative is probably prevented from doing so by the zoning code. As a result they just sell to a developer who is in it for the money.

Not that I have a problem with people who are in it for the money; I buy most of my stuff from such people. But I think it makes a difference in their attitude towards what they are doing.

[plam]

This is U.S. centric, but applies just about anywhere. I know that many here would agree with this point of view. 

Stop Fetishizing Old Homes
"Whatever your aesthetic preferences, new construction is better on nearly every conceivable measure."

Mostly true. I was in some housing in NZ that had seen the previous pandemic a century ago and, well, visiting my friend's very modern build in Quebec City last month was a definite step up in terms of housing quality. I feel like the author only pays lip service to location though. Living close to central Wellington was a lot nicer than living close to uptown Waterloo (though downtown Kitchener is admittedly getting much better than it was 10 years ago). Like, the inside of my place in Waterloo is nice, but the location is... not the best in terms of urbanity. Location trumps a lot.

Maybe the point is that the lots with good location should be redeveloped with new construction. Which is supposed to be coming to central Wellington. I think Waterloo in particular is still a bit too committed to Nodes & Corridors like Toronto?

I think it's also true that a lot of 1970s construction was terrible. 2020s construction is going to be highly value engineered, but like 2020s cars, it doesn't actually break down that often, I think. It's kind of crappy sometimes and looks better than it is, but it's not truly crappy in a way that the mouldy 1970s condos were.

I will also say the level of detail and finishes in the older homes is way above anything you would find in a new tract home builds. I work closely with some Ontario housing developers and seeing how the sausage is made I would never buy a new build. The pride in workmanship just is not there anymore.  Trim, cabinets, countertops, appliances, plumbing features, doors, and floors are all the cheapest possible option. You are paying for the land not the house when you purchase one of these homes. An old home can be renovated to meet the same level of comfort you find in the new homes. Also open floor plans are overrated and make homes feel small, another personal opinion. 

I suspect there's also a bunch of survivor bias there. The really crappy 1940s house just doesn't exist anymore. Maybe it burned down. (It's also not necessarily pride in workmanship; drywall has existed since 1916 but wasn't widely used until the 40s. So it was necessarily more labour intensive in a bunch of places. And, reinforcing the Atlantic post, I'll take crappy modern wiring over knob-and-tube wiring built with pride, thanks.)

I theorize that almost all development is now done by professionals who fundamentally are in the development business; whereas previously a significant amount was done by existing property owners who actually cared about their property. For example, the home owner who builds a house next to them, or rents out their main floor as a store and moves upstairs, or builds a store right in front of the house, or whatever. Now an owner who wants to do something interesting or creative is probably prevented from doing so by the zoning code. As a result they just sell to a developer who is in it for the money.

Not that I have a problem with people who are in it for the money; I buy most of my stuff from such people. But I think it makes a difference in their attitude towards what they are doing.

ac3r wrote quite a bit in another thread on that topic which is apropos here about incentives for building. Lines up well with what you're saying. But in the residential space, I think it's also that it was more feasible for people to build their own in 1906, for a bunch of reasons.

I think also that there's something about concentration vs independence. Like, not so great if the same developer builds the entire subdivision, in a way that maybe didn't exist so much in 1906 in cities? It did in company towns.

[jeffster]

This is U.S. centric, but applies just about anywhere. I know that many here would agree with this point of view. 

Stop Fetishizing Old Homes
"Whatever your aesthetic preferences, new construction is better on nearly every conceivable measure."

For sure the author is correct regarding HVAC and insulation benefits of newer homes. But I wonder how overall build quality is, in comparison. A co-worker of mine had purchased a newer home (about 4 years old) and had issues with pipes freezing and other problems. My semi-detached is about 57 years old, and we never had any issues.

Though I highly doubt anyone with fetish our home...LOL