by Tom Bradley
I live in Vancouver. The topic of the day (and decade) is rising house prices. We're going through a cycle like I’ve never seen. Prices are so far above trend that historical comparisons have become comical. It’s not healthy or sustainable.
For people wanting to get into the market, skyrocketing house prices are a major problem. The overwhelming consensus is that something has to be done about it. Even Prime Minister Trudeau is on the bit – he was here last month to talk about it and has since asked CMHC (Canada Mortgage and Housing Corp) to see what it can do.
And of course, in the provincial government’s efforts to “make housing affordable again”, a 15% tax on foreign buyers went into effect this week.
What really fascinates me about the house price discussion is the lack of mention of what will happen, and who will be affected, if the Prime Minister, Premier and Mayor are successful in cooling off the Vancouver housing market.
In Canada, home ownership has risen from roughly 60% of households to almost 70%. The trend towards owning versus renting has been powerful and broad-based. So, do 70% of Canadians really want to see the value of their homes go down? If a West Side home drops from $2.3 million to $1.5 million, will the owner be pleased with the political leadership?
We all want our children and employees to be able to buy homes in the neighbourhood, but before jumping on the ‘Cool-it’ bandwagon, we better understand what success looks like.