- cross-posted to:
- [email protected]
- cross-posted to:
- [email protected]
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As someone who believes:
A) Housing investors collectively have made incredibly large amounts of money at cost of other Canadians.
B) Essentially every single level of government has done little to aid in housing/infrastructure developments. If not outright block them.
C) Given the other 2 issues aren’t dealt with immigration is the only thing that can completely pivot overnight but we’ve only increased it.
I think the biggest issues is that in the last election 80% of voters seemed to think more of the same was okay. To be clear I’m talking about the people who voted for a party who’s housing minister said that investor is helping the situation or the party’s leader said the same or people who couldn’t even be bothered to vote.
Canada’s fertility rate hasn’t been above the replacement rate in over 50 years and that is with immigration. It’s currently at 1.4 (child per woman/family)
Nearly four-fifths of the 1.8 million population increase from 2016 to 2021 was attributable to new arrivals to Canada either as permanent or temporary immigrants
If you want to lower immigration rates, you’re gonna need to increase birth rates unless you want to become the next Japan where the population is expected to halve within our lifetimes.
The issue is the supply of affordable housing, plain and simple, and there is no solution that does not involve the government intervening in the housing market in some form.
If you want to lower immigration rates, you’re gonna need to increase birth rates
The opposite is also true: if you want to see higher birth rates then housing needs to be affordable. Most Canadians require some financial stability before they start a family, and that is difficult today with the sky high housing costs.
if you want to see higher birth rates then housing needs to be affordable.
Canada’s birth rate has held stagnant for the last 50 years. No time in the last 50 years has housing been affordable? Hell, Toronto had a housing crash in the 1990s. And it still wasn’t affordable right after that?
If your answer is no, it is likely that it is fundamentally impossible to make housing affordable. It ultimately uses up a lot of labour and resources, while removing food growing capability and damaging the climate, for no productive benefit. Good for the individual, but a terrible strain on society as a whole. The cost reflects that.
and that is difficult today
And for the last 50 years, it seems. Even if we can wave a magic wand at housing, how can we be sure that doesn’t end up “I can’t have kids, food is too expensive!” and then “I can’t have kids, internet service is too expensive!”?
The reality is that life has never been affordable. The only thing that changed 50-some-odd years ago was the invention of the birth control pill. And the harsh reality, save some fundamental technological shift, is that life can never be affordable. There is not enough time in the day for all of us to be productive enough to make life affordable.
The number one reason young people tell me they do not want kids these days is because they cannot afford it. Perhaps if housing was more affordable and wages weren’t stagnated it wouldn’t be a privledge to raise a family these days.
The number one reason young people tell me they do not want kids these days is because they cannot afford it.
So they say. I always wonder what the real reason is.
Kids don’t cost much. Moreover, they are a complete time sink. Anything that you used to spend money on vanishes as you won’t have time for it anymore. It is likely the the average person will come out net ahead. And as the kids get a little bit order, they start to become productive, which becomes an income multiplicative factor.
If the average woman in Niger, where the average income is $50 USD per month, can have seven children, anyone in Canada can afford at least one child with ease.
I expect it is the “16 and Pregnant” movement that has dissuaded people from having children. The whole “Don’t ruin your life having children, go to school and get a good job!” message that keeps getting perpetuated. People don’t want to be seen as the rural hick woman pumping out babies. That stereotype has become the scorn of our society.
Children cost approximately $15,000 a year up to the age of 18.
According to StatsCan, the average total income for a person in Canada is $54,400 in 2021.
Experts tell us that we should only spend 30% of our income on housing. That would mean the average Canadian should be spending $16,320 a year. $54,400 minus $16,320 equals $38,080. If you have one child at $15,000 a year, that leaves you with $23,080.
$23,080 is a nice chunk of change, however we still haven’t done any other bills. According to the Globe and Mail, the average new car payment is $880 per month. That’s $10,560 a year. We’re now at $13,080 in left over income.
In the 2023 Canada Food Price Report, a family four will spend $16,288.41. We’ll take 75% of $16,288.41 to represent a family of three. That couple would be spending approximately $12,216.30 a year in food. $13,080 subtracting $12,216 .30 means you are left over with $863.70.
CCA currently states that the average price of gasoline in 2022 was $1.632. Let’s say you have a 50l tank, that means you are spending $81.60 per fill up. Twice a month, means you spend $163.20. Over the course of a year, you will spend $1,958.40. Oh shit, we’re in the red now with -$1,904.70
We still have to pay for our cell phone, internet, hair cuts, clothing, emergencies, save for retirement, pay down debt, etc.
You da real MVP with sources and everything
Great work sourcing. Too bad the message is misleading. Using those sources we can see, for example, his $15,000 figure includes the child’s portion of shelter and transportation costs, which he then includes again when calculating the cost of housing and car ownership. You don’t have to actually pay for those same things twice.
Poor people don’t need cars. So it saves a lot of money.
Not to mention that if you look at what the $15,000 child cost includes, it already factors in things like transportation and shelter costs. Which @[email protected] includes again when budgeting parental costs.
Based on his numbers, removing the duplication, this single income supporting a family of three comes out comfortably in the black. And that’s with childcare costs included! If you are going to pay for childcare, why not have two incomes supporting the family of three? Now you’re saving money hand over fist.
If not being able to accurately calculate costs is the reason why Canadians aren’t having children… Maybe it’s best to keep that out of the gene pool anyway.
Children cost approximately $15,000 a year up to the age of 18.
Keep in mind this figure includes things like cost of shelter. It certainly costs money to shelter a child, so the $15,000 isn’t invalid, but not applicable if you are going to account for shelter elsewhere. Double entry accounting doesn’t mean accounting for the same thing twice.
Somewhere closer to $4,000 per year is what is generally accepted as the cost of the child alone, excluding such externalities which are a real cost, but reasonably accounted for elsewhere. This brings you back into the black with some money to spare.
Note, even the $4,000 (average yearly cost over 18 years) includes childcare costs. This means the typical parental unit should be able to double its income expectations from what you have presented. If one parent is foregoing an income to care for the child, then $4,000 would be reduced.
Oh shit, we’re in the red now with -$1,904.70
According to Statscan, the average woman is 29 years old when she has her first child. For the sake of discussion, we will assume the partner is of the same age.
Employment regulation varies by province, but generally one is expected to start working at the age of 14 and somewhere around 20 hours per week. There is a legal expectation of being under the care of an adult for those first four working years, which means it is, for all intents and purposes, pure profit.
If we assume a youngster is paid $10 per hour, that is $7,500 after tax each year. If we assume a 3% interest rate, that leaves one with around $50,000 in hand by the time they have their first child even if no further saving takes place after turning 18. But it takes two to tango, as they say, so actually a combined $100,000 is available.
Even if your family really is haemorrhaging $2,000 per year once you turn 29, you still have 50-some-odd years of runway. You could quite possibly have great grandchildren by the time you run out of money at that burn rate.
pay down debt
There is capital benefit to housing and automobiles, so debt may be justifiable there, but you have already included those payments in your earlier figures. What other debt could there possibly be? The average Canadian isn’t starting a business and your cashflow figures are positive before the child comes along. No need to account for the same thing twice.
While I agree the answer to the issue is the solution. As I noted it doesn’t seems like people agree on the issue.
So what is wrong with a declining population, anyway?
An increasingly aging population. Less money from taxation to fund services, decreasing standards of living, more people dependent on a decreasing number of income earners, being in a nursing home without anyone available to care for you etc
A death spiral unless we can somehow manage to grow economically to compensate but even then the social outcomes arent great either.
Note also that the Liberals have basically stated that their immigration policy is intended to suppress wages. It’s not about helping refugees, or about diversity, it’s about class warfare.
the Liberals have basically stated that their immigration policy is intended to suppress wages.
Policy fail, then. With the exception of the height of COVID, wages have beat inflation since Trudeau took the Prime Ministership. Even the BoC has stepped in to try and stop it.
There is no war but class war.
Yeah, the government is helping house Canadians the same way the government is helping Canadians enjoy a livable climate in the future.
50% of Airbnb in Toronto are hosted by entities of 10+ full homes. The average occupancy rate is 37 nights/year. How are we letting this happen?
Numbered corporations create annoymity for these Airbnb landlords to evade taxes and encourage mortgage fraud. force real name incorporation for real estate and cities can enact punishing tax rates for these illegal hotel operators.
Source? 50% seems really low
http://insideairbnb.com/toronto
It’s interactive. I clicked on the “full homes” and only multi listings and the number was 8600/16000.
Cool
Corporations should never be able to buy homes, they’re not a commodity. I’m in the US and we have the same problem, it’s fucking us over with no end in sight.
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sad by true 😭
No, they are not. The defining feature of a commodity is that it is interchangeable.
If you in Ontario try to charge me too much for a bushel of wheat, I’ll laugh and buy it from a guy in Saskatchewan selling it at a reasonable price instead. Makes no difference to me. The product is the same either way.
If I try to charge you too much for a house in Ontario, it would make no difference to you to move to Saskatchewan? I suspect not. They are not equivalent products. Living in the Ontario home will be a very different experience to living in the Saskatchewan home.
If housing were a commodity, a lot of our problems would be solved. But, housing is not. It even has a popular slogan to remind you of that fact: Location, location, location.
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Immigrants have always been the punching bag of long term residents…
I was researching the other day when we might expect the housing market to recover to the point where people can actually afford a house again.
Instead, what I found was lots of articles proclaiming that the housing market will “recover” by 2024. By “recover” they meant that the downward trend in $$$ is going up again. Meaning house prices going up.
It really blew my mind that there is so little concern for affordability and it’s all about the investments… So sad. Seriously considering leaving Canada at some point in the future in order to buy a house, which is nuts.
Blaming corporations is a cop-out. Small “mom and pop” landlords are just as capable of gouging their fellow Canadians for profit. At least there are real-estate corporations that build stuff instead of being purely parasitic.
And at least the corps have to pay tax on their profits. Private owners who bought when things were cheap and are now multimillionaires got all that money effort-free and tax-free thanks to the principal residence exception.
This stinks. I’m not a landlord, I do own my own house.
And at least the corps have to pay tax on their profits
I wish i payed 15%. I’m not even counting on the rebates they get for setting up shop places, or developing “doing research”. Corporations quite often do not pay their fair share. Corporations do buy up swaths of real estate.
Private owners who bought when things were cheap and are now multimillionaires got all that money effort-free and tax-free thanks to the principal residence exception.
Almost nobody got their shit effort-free, you still have to go in with the bank and pay them a shit tonne of money. Principal residence only applies to first residence, and you still have to pay taxes on your residence (I know, because I pay them).
And here’s some news for you: housing was always relatively expensive, people who bought gigantic mortgages took on a whole pile of risk, made the banks rich, and sometimes came out richer for it; that doesn’t make them bad.
How exactly do they get it tax free due to principle residence exemption?
If you bought your house in 1986 for $60k, and then sold it in 2021 for a $million, and you lived in it for those 25 years as your principal residence, then that is tax-free.
Obviously this is less about landlords than just homeowners who are celebrating their good fortune, but still: blaming corporations is a cop-out.
Corporations are 100% to blame for the rising prices. They are increasingly buying new and old homes (single family, apartments and condos).
According to the CHSP, more than a fifth of all houses in British Columbia, New Brunswick, Nova Scotia and Ontario were owned by investors in 2020. That is a fucking insane number considering the current crisis.
https://www150.statcan.gc.ca/n1/pub/46-28-0001/2023001/article/00001-eng.htm
That is not the only factor, but it is undeniably an issue in the ballooning price of rent and home value.
According to the CHSP, more than a fifth of all houses in British Columbia, New Brunswick, Nova Scotia and Ontario were owned by investors in 2020. That is a fucking insane number considering the current crisis.
This does not necessarily mean they’re being bought by corporations. Plenty of individual buyers are investors. And remember, investment properties go onto the market to get rented. If there was really a massive glut of investment properties being created, rents would be plummeting. Is that happening? Of course not. And houses are not only 20% too expensive. And if Toronto made 20% more housing would it solve the housing crisis, would it offset the damage done by “investors”? According to the CMHC, Toronto is only hitting half of its target for completions needed to put a dent in this. Mississauga is doing far worse (which is why I’m deeply skeptical of mayor Bonnie Crombie’s attempt to take over the OLP – she got me to register to in the provincial liberals leadership race just to vote against her).
In Toronto, the number of bedrooms per year built peaked in 2001, and went down to below half by 2019. The housing crisis happened because demand went up and supply went down. Nothing more, nothing less. And the reason supply went down isn’t “corporation” or “investors”, it’s municipal governments that made housing illegal and the provinces that enabled them.
https://twitter.com/benmyers29/status/1222613287092785159
Imagine if there was a starvation crisis and it took years to get approvals to plant more farms. That would be insane, right? And it would also be insane if people blamed “farming corporations” for starvation, right? And yet that’s where we are right now. People blaming “greedy developers” for the housing crisis that’s caused by governments making housing illegal (unless they get a special one-off pardon, like a murder in the USA) combined with rising immigration.
If it really was just investors buying up everything, rents would be cheap. But since it’s expensive both to rent and buy, it means there’s just not enough stuff for all the people who want it. And if you can make a million dollars for putting up a unit, why wouldn’t you? Well, if somebody was stopping you.
Your point is that blaming corporations is a cop out. My point is that blaming the corporations is not a cop out, and one of the reasons, not the only reason. NIMBY and zoning regulations are definitely also affecting the crisis.
If it really was just investors buying up everything, rents would be cheap.
That is such a naive point of view. Landlords would rather leave a unit empty instead of lowering rent because otherwise it would lower the value of their investment.
The housing market isn’t a free market like you seem to imply. People need to have housing, so landlords will definitely gouge their tenants because they can and we see an article pretty much daily of renovictions and rent ballooning up once the lease is at term. Having more supply would definitely alleviate this problem, but it is only part of the solution. REIT buying swath of houses with lower interests than individuals is definitely inflating the prices because they can buy housing at a higher price, causing the other houses in the area to raise as well.
Yeah, that one is well known. I was trying to figure out how they made that work with rentals, which don’t have that exclusive.
Sorry, but how does that tax exemption work for the landlords then? They have to live in the unit for at least a year to avoid capital gain on the property.
That’s 9%/year annual rate of return (assuming 2% inflation), which is good, but not unheard of (here’s the calculator i used. This ignores all the money they put into the place while they lived in it (roof’s and heaters etc aren’t cheap). It also discounts that they need to find a place to live in 2021 where all houses just got much more expensive then back in 1986.
That whole time they were paying property tax.
The beaverton speaks truth once again!
As a Lemmy passer-by and one-time resident of Toronto… I almost ate the onion on this one.
And they can’t wait until we push our govt to build more homes … So they can buy them up.
Everyone saying we need more supply is a loon. We need a reallocation of existing homes. Building more will just line these assholes’ pockets.
Ahh, didn’t know Canadians had their own version of The Onion.
