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Why not institute policies to build more housing units? Taxation should be used to manipulate prices downward only when other market options don't exist. The

Why not institute policies to build more housing units? Taxation should be used to manipulate prices downward only when other market options don't exist. The government could finance the construction of new houses. They could even go so far as incentivize the construction of entirely new suburbs or towns outside of major cities like Vancouver and build ultra-fast trains to connect the commercial district of the major city to the new suburb that is being built with affordable housing in mind. Trying to halt foreign investment is a fool's errand. There is too much money to be made from these people, giving a strong financial incentive to find legal ways to subvert the taxes/regulations put in place.

jmpman 6y ago
I’ve wondered why California doesn’t leverage Prop 13 to encourage more housing units. Say for any property which isn’t owner occupied, the number of rentable units must increase by N per year in order to maintain Prop 13 tax lock. Seems like very quickly we would have landlords fighting cities to expand their rentable units, expending much more money than they otherwise would in order to expand the rental stock.
deleted 6y ago
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toomuchtodo 6y ago
Because there is more money than land. More realistic to push the foreign money out. If loopholes are discovered, tighten regulations further. Many countries restrict foreign real estate investment without issue (Mexico and Thailand come to mind, but there are many others).
- mywittyname 6y ago
  Canada seems like it has plenty of land left to build on. None of their major cities come close to the size of US cities like Dallas-Fort Worth or Chicago. Any attempts to limit the inflow of Chinese investment will fail. And the more aggressive the government gets, the more Canadians are going to get caught up in it by accident. Chinese people are willing to pay massive premiums for houses and high property taxes, all while not utilizing any of the services those taxes are paying for. Canada would be wise to start incentivizing construction in out-of-the-way places specifically to accommodate these investors. Otherwise, these foreign investors will use their extensive capital to find legal loopholes and will continue to focus on "safer" bets (read: Vancouver housing). It's exactly like the problem with DRM: being aggressive just hurts legitimate consumers because hackers will always find a loophole in the system. So the best course of action is to give customers exactly what they want with minimal friction. Funny that you bring up Mexico because Mexico's system is similar to what I'm proposing: special economic zones and other incentives that ensure that foreign investment flows where the government wants it to.
- dirtyid 6y ago
  Toronto, despite being the crane capital of the world "only" built 200k condo units in 20 years with marginal increase in other housing. Population increased 500k in the same period. Mississauga increased 120k dwelling units in 40 years, while population increased 300k. Beijing cranked out multiple 100K+ megablocks in 5 years. It's a supply side problem. There's more land than money, 1/2 of Richmond BC is undeveloped. There's space for millions of units. The fundamental problem is Canada cannot build due to combination of regulations and construction culture.

jmpman 6y ago

I’ve wondered why California doesn’t leverage Prop 13 to encourage more housing units. Say for any property which isn’t owner occupied, the number of rentable units must increase by N per year in order to maintain Prop 13 tax lock. Seems like very quickly we would have landlords fighting cities to expand their rentable units, expending much more money than they otherwise would in order to expand the rental stock.

deleted 6y ago

[deleted]

toomuchtodo 6y ago

Because there is more money than land. More realistic to push the foreign money out. If loopholes are discovered, tighten regulations further. Many countries restrict foreign real estate investment without issue (Mexico and Thailand come to mind, but there are many others).

mywittyname 6y ago
Canada seems like it has plenty of land left to build on. None of their major cities come close to the size of US cities like Dallas-Fort Worth or Chicago. Any attempts to limit the inflow of Chinese investment will fail. And the more aggressive the government gets, the more Canadians are going to get caught up in it by accident. Chinese people are willing to pay massive premiums for houses and high property taxes, all while not utilizing any of the services those taxes are paying for. Canada would be wise to start incentivizing construction in out-of-the-way places specifically to accommodate these investors. Otherwise, these foreign investors will use their extensive capital to find legal loopholes and will continue to focus on "safer" bets (read: Vancouver housing). It's exactly like the problem with DRM: being aggressive just hurts legitimate consumers because hackers will always find a loophole in the system. So the best course of action is to give customers exactly what they want with minimal friction. Funny that you bring up Mexico because Mexico's system is similar to what I'm proposing: special economic zones and other incentives that ensure that foreign investment flows where the government wants it to.
dirtyid 6y ago
Toronto, despite being the crane capital of the world "only" built 200k condo units in 20 years with marginal increase in other housing. Population increased 500k in the same period. Mississauga increased 120k dwelling units in 40 years, while population increased 300k. Beijing cranked out multiple 100K+ megablocks in 5 years. It's a supply side problem. There's more land than money, 1/2 of Richmond BC is undeveloped. There's space for millions of units. The fundamental problem is Canada cannot build due to combination of regulations and construction culture.