Posted on 05/17/2016 5:53:46 PM PDT by Lorianne
There's a bidding war for government action on Canada's soaring housing market, but as fingers point to foreign buyers as a reason for escalating prices, governments at all three levels are not yet motivated to cool the market down.
Young Canadians complain home ownership is increasingly beyond their reach. Governments fear rules to put a lid on stratospheric prices — expected to show another strong increase in today's real estate data for April — could have an an economic impact far beyond the first-time buyer market.
The difficulty governments face is that while Canadian manufacturing and exports fall, while oil and resources crash, the property market has become the spark plug of the economy. The proverbial engine of growth is firing on a single cylinder.
Efforts to tabulate exactly how much foreign money is entering the market are unlikely to be definitive. The debate over whether it is five, 14 or 66 per cent of sales, to quote some of the estimates in a recent Maclean's article, will not be easily resolved.
Family members can be placeholders for overseas investors. Layers of corporate ownership can do something similar, as South China Morning Post Vancouver correspondent Ian Young explains.
And that may be just the way a lot of those who benefit from the real estate market want to keep it.
The fact is the foreign contribution to rising prices is only accelerating a global phenomenon that would have happened in Canada anyway. The real issue is land, hence the real estate truism: "They ain't makin' any more of it." As populations grow, prime land close to where people want to live inevitably gets bid up in value.
(Excerpt) Read more at cbc.ca ...
I believe Canada’s housing bubble is in large part due to Chinese owners buying up housing in many places.
The thing is, China does not allow Western buyers to likewise buy in China.
Just saying. They do not. Completely unbalanced system, at the moment.
I gotta admit, some of those prices you see on “Property Brothers” shock me as to what houses are going for up there.
Alright, now insert all appropriate “Property Brothers” jokes. I’ve probably seen about two dozen shows.
And everything else aside, yes, it’s quite obvious HGTV has an agenda.
Same thing has been going on in SoCal for several years. Chinese buyers paying cash for houses and driving prices.
I think HGTV stands for “Homo-Gyno Television.” Something like that.
In our area in the suburbs south of Houston muslim buyers with lots of cash are buying up houses when they come on the market or engage in bidding wars and drive prices up so high that they are not affordable by regular folks. This, in turn, drives up the assessed valuation on all the neighboring homes for tax and insurance purposes. Getting to be a no-win situation.
It’s Chinese capital flight.
People getting out and stashing money anywhere but the increasingly shaky Chinese asset markets.
You don’t really want reciprocity in this case.
You might be right but do you really want to buy property in China?
I want to (be able to).
Yes. Absolutely.
Question: If so much money can be made flipping houses and investing in real estate, why would anyone want to waste time teaching other people how to do it?
Answer: Because it's no longer true ... or won't be very soon.
I’m sure the 66% figure is true in Vancouver, if not more, where junk houses on ordinary lots can go for C$1.2 million.
I’m sure the 66% figure is true in Vancouver, if not more, where junk houses on ordinary lots can go for C$1.2 million.
At that point you are no longer talking about home values; you are talking about land values. Any place on a coast will watch these price increases occur more quickly because there is less area for “sprawl”.
It’s funny, but the Canadians are all over the community I live in SW of Phoenix. They buy up any houses coming on the market using all cash, which makes it difficult for locals to buy a home. They’re snowbirds so the houses are vacant half the year too.
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