4 ms·

Lets try to avoid the sophistry. I dont think the native Americans were wrong to consider the influx of European settlers as being a threat to their existence.

Lets try to avoid the sophistry. I dont think the native Americans were wrong to consider the influx of European settlers as being a threat to their existence. Also like "But it's the price increases that cause the investments, not the other way around." is completely nonsensical. Investment is about the expectation of the future price. If something has increased in price it might indicate that it will decrease in price in the future (so called over-priced).

JamisonM 4y ago
The expectation of the future price of housing for foreign investors is entirely about believing that future construction will be restricted. If investors, foreign or otherwise, believed that housing was a market that responded to market forces in a timely manner they would not invest. It is therefore reasonable to assume that the foreign investors: 1. Believe that their domestic real estate market is overpriced or will respond very quickly to market pressures that will make any investment undervalued. 2. Believe there is non-market benefits to owning foreign real estate that compensate for any additional risk associated with investing overseas. I believe that both of these factors are at play, Canadian real estate rules make markets dysfunctional so property values tend to increase disproportionally compared to what they should. But it is also the case that a upper-middle class Chinese person looking to secure assets outside the purview of the authoritarian government they are forced to live under will pay a premium. Ideally what we all want is a situation where the Canadian market is very dynamic and investments provide a reasonable return but any foreign investors that are investing for non-market benefit reasons are compelled to put their properties into the market for rental at market rate for economic reasons but still get to enjoy the bit of freedom that foreign investment affords them.
- petermcneeley 4y ago
  >upper-middle class Chinese person looking to secure assets outside the purview of the authoritarian government they are forced to live under will pay a premium I think this plays such a significant role in the motives behind the foreign investment that even if housing was going down they would still make this trade.
  - JamisonM 4y ago
    And any jurisdiction that loosens zoning restrictions can benefit from the investments that will expand availability instead of being harmed by the consumption of a scarce resource. Potential for a win-win situation.

JamisonM 4y ago

The expectation of the future price of housing for foreign investors is entirely about believing that future construction will be restricted. If investors, foreign or otherwise, believed that housing was a market that responded to market forces in a timely manner they would not invest. It is therefore reasonable to assume that the foreign investors: 1. Believe that their domestic real estate market is overpriced or will respond very quickly to market pressures that will make any investment undervalued. 2. Believe there is non-market benefits to owning foreign real estate that compensate for any additional risk associated with investing overseas. I believe that both of these factors are at play, Canadian real estate rules make markets dysfunctional so property values tend to increase disproportionally compared to what they should. But it is also the case that a upper-middle class Chinese person looking to secure assets outside the purview of the authoritarian government they are forced to live under will pay a premium. Ideally what we all want is a situation where the Canadian market is very dynamic and investments provide a reasonable return but any foreign investors that are investing for non-market benefit reasons are compelled to put their properties into the market for rental at market rate for economic reasons but still get to enjoy the bit of freedom that foreign investment affords them.

petermcneeley 4y ago
>upper-middle class Chinese person looking to secure assets outside the purview of the authoritarian government they are forced to live under will pay a premium I think this plays such a significant role in the motives behind the foreign investment that even if housing was going down they would still make this trade.
- JamisonM 4y ago
  And any jurisdiction that loosens zoning restrictions can benefit from the investments that will expand availability instead of being harmed by the consumption of a scarce resource. Potential for a win-win situation.