I’ve heard that Mark Carney wants to ‘bail out developers’. It looks to me more like David Eby wants to help out people who can’t afford to buy a first home—but then spin, vibes, and ideology got involved. :-(
I’ve heard that Mark Carney wants to ‘bail out developers’. It looks to me more like David Eby wants to help out people who can’t afford to buy a first home—but then spin, vibes, and ideology got involved. :-(
I think you’re both saying the same thing in different ways. Boomers don’t just not want change because it’s change, they don’t want change because it impacts their property values. Its not about selling, it’s about home equity, and home equity financing. It’s truly shocking how much of that I see. Effectively selling off the market value of their property to fund their retirements as long as the property values never drop. Honestly not that much different than how the ultra wealthy never actually realize any tangible profits, they just take out equity backed loans and live large on tax free cash.
As Albertans have found out the hard way, it all comes down to the provinces. At the end of the day, local policy exists only at the discretion of the provinces. If the province wants something done, it’ll get done, and if the province doesn’t want something done, it’s dead in the water, and there’s nothing the local councils can do about it. The fed can play a role… if, and only if, the provinces allow it. Municipal autonomy is more of convention than a hard and fast rule. If the province wants to intervene, they can. That’s not to say the city councils don’t share some blame here. They have, historically, been the major hurdle. We should be very clear eyed about the problem though. The levers to fix this exist at the provincial level. They aren’t being used, because provincial governments live or die at the whims of the senior citizens.
What the feds SHOULD be doing is figuring out how to shut off the gravy train of equity financing without a) collapsing the whole economy, or b) leaving us a bunch of broke old people we have no way to house or take care of.
I think one also has to consider the persistent low interest rates that has happened in the last 20-30 years and how this has incentivized for assets to not only skyrocket in value, but also make people think that money is ‘cheap’. What’s even crazier is that the banks and various private lenders were more than willing to give out large mortgages and loans to people until they realized the problem got so big and risky that they had to introduce stress tests.
The feds have a difficult job ahead of it if they try and unwind the gravy train - the economy would have to run red hot so that the interest rates can be raised slowly over time by the BoC. If the BoC’s rates were somehow managed differently when it came to housing, there might be an easier way out.
Of course people could believe that intensification will lower their property values, but from what I’ve read it usually increases the value of properties. When I hear these guys talk, however, I think it isn’t about the money–it’s just they are afraid of change. I can understand that, as there’s no ‘do over’ once the developers start building. I agree, however, that it ultimately comes down to the provinces—even though toads like Poilievre will go to great lengths to blame it all on the federal Liberals.
As for equity financing, I suppose boomers know it as a ‘reverse mortgage’–from the television adverts. It strikes me this only happens because of the weird situation we currently find ourselves in because zoning won’t allow cities (if they wanted) to build enough housing. Without the lack of supply, houses would cost less, so there’s less incentive to loam money to owners. It’s true the provinces have the last word, but I’ve had some weird conversations with ‘progressive NDP’ council members in the city where I used to live who refused to even consider allowing having enough housing for everyone as one of the city’s official plan criteria. I also have read that councils often move heaven-and-earth to get around reforms that were supposed to increase density–effectively sabotaging the province when it tries to do something right.
Frankly, the housing issue has made me somewhat bitter about the so-called ‘progressives’ I meet.