Quote:
Originally Posted by Traum
With him teaching at UBC and being based in Vancouver, I honestly don't know how he can ever think the $1M threshold that he suggested is a reasonable number. It might be reasonable for other parts of the country, but for the 2 most expensive RE markets in Canada -- Toronto and Vancouver -- they almost definitely do not make any sense.
In Vancouver, the high prices is primarily a major disconnect between demand and supply. People continue to think Vancouver is a desirable place to live, so the demand is huge. Meanwhile, CoV, in particular, takes forever to approve new building permits, while other municipalities are nowhere close to being fast either. The building code, esp CoV's ultra leftard green initiatives, make building costs expensive. Quite a number of RS-ers have work related to the construction business one way or another. I'm sure they can tell you what can be done on the supply side to improve things so that costs savings can come down from there, and these are far better suggestions than to "just tax the current home owners".
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This tax suggestion is one of the dumber ideas to come out - every form of tax that we have thrown on top of housing has largely failed because, ultimately as you said, this is a supply problem. We don't have enough housing so people are forced to spend like crazy to get something - when the average detached home in Chilliwack and Hope cost $1m I think we've gone well past the theory that it's just foreign investment (BTW: You can get a fantastic detached house in central Calgary for $1m). Detached homes in Hope are being built with suites so people can afford to buy them. It's completely nuts.
This tax would just be more theatre - by allowing deferral it'll never have the effect he suggests in terms of slowing down home purchases and it disproportionately affects the different types of people who own these homes. Some lucked into them by having lived in them for ages, others actually put all their money into one just so they could have it etc. Taxes should be relatively equitable and this one wouldn't be.
There's a small myth that we're out of land to build on in the lower mainland - the myth exists because technically we don't have any more SFH lots available but that's strictly a zoning problem. There are tonnes of massive lots in the lower mainland that the cities won't allow subdivision on so they artificially inflate housing costs. Allow smaller lots and you've got lower costs right away. Then allow more units of housing on these lots and more square feet. I noticed Calgary has much more flexibility in lot sizes and housing types than we do and they've got tonnes of land to build on.
Our politicians are bunch of cowards.