7 ms·

Building more doesn't work. Some areas in Toronto have 30% empty dwellings. There are much more money available to speculate than available surface area. Leve

Building more doesn't work. Some areas in Toronto have 30% empty dwellings. There are much more money available to speculate than available surface area. Leverage was cheap (through housing) so everyone played that asset class on margin here. Now that the interest rates are going up, it will sort itself out.

tptacek 8y ago
The average rent in Toronto is even lower than that of Chicago. It doesn't sound like there is a housing problem there.
- jacquesc 8y ago
  You have to compare it to avg incomes. They make less in Vancouver than Chicago, so it takes up a much higher percentage of their income.
  - xyzzyz 8y ago
    I just did that, and it’s not true. Average rent is higher percentage of average wage in Chicago.
    - tptacek 8y ago
      Also, I said Toronto.
    - deleted 8y ago
      [deleted]
  - tfehring 8y ago
    I assume you mean Toronto, not Vancouver, based on the parent comment. Median household income in Toronto is $65,829 CAD as of 2015 [0], which is about $52,500 USD adjusted for purchasing power parity [1]. Chicago's median income from 2012 to 2016 was $50,434 [2]. I didn't take the time to find numbers that are perfectly apples-to-apples, but it definitely doesn't seem like Toronto's median income is materially lower than Chicago's. [0] https://www.toronto.ca/wp-content/uploads/2017/10/8f41-2016-Census-Backgrounder-Income.pdf https://www.toronto.ca/wp-content/uploads/2017/10/8f41-2016-... [1] https://data.oecd.org/conversion/purchasing-power-parities-ppp.htm https://data.oecd.org/conversion/purchasing-power-parities-p... [2] https://www.census.gov/quickfacts/fact/table/chicagocityillinois/LND110210 https://www.census.gov/quickfacts/fact/table/chicagocityilli...
jowiar 8y ago
Cities need to fund themselves through real estate rather than income taxes. Tax “the person who could live in a place” rather than “the person who does live in a place”. For actual residents, it’s a wash, but it severely penalizes the investment crowd.
- underwater 8y ago
  It also severlely penalizes the elderly and retired, who don’t earn but certainly still vote. In my city in Australia it’s common to see a single elderly retiree living in a rundown home on a large block, where the land alone could be worth close to a million dollars. When the property is sold it can often be split into two, and house two families in detached homes. It feels cold hearted to say elderly should be pushed out of homes they have lived in for 50 years. But it does make it harder for cities to grow - the carrot of higher prices doesn’t seem to work for people who just want to live out their days in the community and home they know.
  - underwater 8y ago
    Here is a random example (https://www.domain.com.au/64-days-avenue-yeronga-qld-4104-2014561367 https://www.domain.com.au/64-days-avenue-yeronga-qld-4104-20...) I just came across. A home that was purchased 30 years ago for the equivalent of 350k, selling for 1.4 million. The same sized property next door has a full sized home and three townhomes. So potentially one person living in the same space that is housing a dozen next door.
  - bradleyjg 8y ago
    > It feels cold hearted to say elderly should be pushed out of homes they have lived in for 50 years. More or less cold hearted than forcing three new dads to spend 15% of their waking hours getting back and forth to work, which means they only sees their kids when they are sleeping?
  - jowiar 8y ago
    If you have a million bucks in assets, I don't care if you're 75. Our country has been ruined by boomers running the country into debt by way of cutting their taxes -- taxes that millennials will eventually have to pay. I have no qualms with taxing the "winners" of that generation. They owe it to us anyway.
RidingPegasus 8y ago
> much more money available to speculate than available surface area Doubtful, some of the biggest cities on earth have tiny geographic areas. Build more and let them keep buying, a clear government policy that targets rezoning to keep price rises in-step with inflation would certainly make empty home investors think twice. Real estate speculation is a gamble that governments won't accommodate growing populations and politically benefit from rising house prices. In many places on Earth they are likely right.

tptacek 8y ago

The average rent in Toronto is even lower than that of Chicago. It doesn't sound like there is a housing problem there.

jacquesc 8y ago
You have to compare it to avg incomes. They make less in Vancouver than Chicago, so it takes up a much higher percentage of their income.
- xyzzyz 8y ago
  I just did that, and it’s not true. Average rent is higher percentage of average wage in Chicago.
  - tptacek 8y ago
    Also, I said Toronto.
  - deleted 8y ago
    [deleted]
- tfehring 8y ago
  I assume you mean Toronto, not Vancouver, based on the parent comment. Median household income in Toronto is $65,829 CAD as of 2015 [0], which is about $52,500 USD adjusted for purchasing power parity [1]. Chicago's median income from 2012 to 2016 was $50,434 [2]. I didn't take the time to find numbers that are perfectly apples-to-apples, but it definitely doesn't seem like Toronto's median income is materially lower than Chicago's. [0] https://www.toronto.ca/wp-content/uploads/2017/10/8f41-2016-Census-Backgrounder-Income.pdf https://www.toronto.ca/wp-content/uploads/2017/10/8f41-2016-... [1] https://data.oecd.org/conversion/purchasing-power-parities-ppp.htm https://data.oecd.org/conversion/purchasing-power-parities-p... [2] https://www.census.gov/quickfacts/fact/table/chicagocityillinois/LND110210 https://www.census.gov/quickfacts/fact/table/chicagocityilli...

jowiar 8y ago

Cities need to fund themselves through real estate rather than income taxes. Tax “the person who could live in a place” rather than “the person who does live in a place”. For actual residents, it’s a wash, but it severely penalizes the investment crowd.

underwater 8y ago
It also severlely penalizes the elderly and retired, who don’t earn but certainly still vote. In my city in Australia it’s common to see a single elderly retiree living in a rundown home on a large block, where the land alone could be worth close to a million dollars. When the property is sold it can often be split into two, and house two families in detached homes. It feels cold hearted to say elderly should be pushed out of homes they have lived in for 50 years. But it does make it harder for cities to grow - the carrot of higher prices doesn’t seem to work for people who just want to live out their days in the community and home they know.
- underwater 8y ago
  Here is a random example (https://www.domain.com.au/64-days-avenue-yeronga-qld-4104-2014561367 https://www.domain.com.au/64-days-avenue-yeronga-qld-4104-20...) I just came across. A home that was purchased 30 years ago for the equivalent of 350k, selling for 1.4 million. The same sized property next door has a full sized home and three townhomes. So potentially one person living in the same space that is housing a dozen next door.
- bradleyjg 8y ago
  > It feels cold hearted to say elderly should be pushed out of homes they have lived in for 50 years. More or less cold hearted than forcing three new dads to spend 15% of their waking hours getting back and forth to work, which means they only sees their kids when they are sleeping?
- jowiar 8y ago
  If you have a million bucks in assets, I don't care if you're 75. Our country has been ruined by boomers running the country into debt by way of cutting their taxes -- taxes that millennials will eventually have to pay. I have no qualms with taxing the "winners" of that generation. They owe it to us anyway.

RidingPegasus 8y ago

> much more money available to speculate than available surface area Doubtful, some of the biggest cities on earth have tiny geographic areas. Build more and let them keep buying, a clear government policy that targets rezoning to keep price rises in-step with inflation would certainly make empty home investors think twice. Real estate speculation is a gamble that governments won't accommodate growing populations and politically benefit from rising house prices. In many places on Earth they are likely right.