Trudeau government has the land, money and power to fix Canada’s housing crisis. What are they waiting for?

[CdnFox]

https://www.thestar.com/business/trudeau-government-has-the-land-money-and-power-to-fix-canada-s-housing-crisis-what/article_6d1c9413-1f6d-5b58-a6af-5611215cd60b.html

The housing crisis can be resolved relatively soon once Ottawa shares the urgency of Canadians to get this most basic problem fixed.

We have been here before.

Ottawa built about a million low-cost “Victory Houses” after World War II and provided money and land again to help house waves of immigrants from the mid-1960s to the mid-1980s.

As for private-sector homebuilders, 50 years ago they were replacing single-family dwellings with multiplexes and lowrise apartment buildings with 12 to 16 units.

But today, millions of Canadians are shut out of the housing market.

What went wrong?

[CdnFox]

It's an interesting point. We have addressed this sort of thing before, though never to this scale.

I think the article simplifies the problem a great deal and is a little unrealistic.  But - Trudeau does have the tools to wade into this - so why isn't he?

My guess is inflation.  I suspect his people have said after ALL the extra spending he's done which has driven up inflation and interest rates - if he dives in with money to fix this problem we'll see both of those shoot up again like a rocket.

He can't do major new public works until he gets his inflation and interest under control - which means a recession.  THEN he can look at announcing something as 'stimulus' or part of a 'new deal'.

[Dougie93]

the real estate sector is an asset class being inflated by unconstrained government money printing

the newly printed money is funnelling into stocks & real estate to find returns

nothing will stop it except withdrawing money back to the central bank

by raising interest rates well above the rate of actual  inflation ( food, energy, shelter )

but if they do that, it will incite a wage & price spiral, otherwise known as a depression

so they are trapped, damned if they do, damned if they don't

[CdnFox]

20 minutes ago, Dougie93 said:

the real estate sector is an asset class being inflated by unconstrained government money printing

the newly printed money is funnelling into stocks & real estate to find returns

nothing will stop it except withdrawing money back to the central bank

by raising interest rates well above the rate of actual  inflation ( food, energy, shelter )

but if they do that, it will incite a wage & price spiral, otherwise known as a depression

so they are trapped, damned if they do, damned if they don't

yeah - none of that's true.

This has been a bubbling problem for 20 years.  Municipalities, provinces and even the feds to a degree put up too many barriers that prevent developers from building enough homes. And that means supply is less than demand and that has been growing and growing for 2 decades. 

Now it's boiled over and there are simply not enough homes for people to live in. The solution is to build more homes but that is in fact going to take some real willpower on the part of the feds to lead the provinces.

[Dougie93]

3 minutes ago, CdnFox said:

This has been a bubbling problem for 20 years. 

and the problem all goes back to quantitative easing

exactly as you say, it started with the Dot Com bubble twenty or so years ago

the central banks started buying the bonds to keep the interest rates well below historical averages

this forces the money into asset class bubbles to try to find retunrs

predominately stocks & real estate

[CdnFox]

12 minutes ago, Dougie93 said:

and the problem all goes back to quantitative easing

 

No it doesn't. And stop using words unless you know what they mean. 

This has nothing to do with quantitative easing. It has nothing to do with interest rates either.

This is very simple.  Due to red tape and tax policy, we stopped building enough homes. There was a day when developers said "how many homes will we need next year?" and built those.  Now they say "how many homes do we need right now", and they START to build those but it'll take 3 years of approval process and permits - by which time that number of homes isn't even close to what we need.

Interest rates doesn't change that.  Money supply doesn't change that.  Inflation doesn't change that.  The only thing that DOES change it is it gets WORSE when things are unstable, like interest rates are fluctuating. 

Developers need to be incentivized to build faster and build ahead of need again, and local and provincial gov'ts need to be told to get out of their way. Then  we need to slow down immigration for a short time to let our supply catch up

[Dougie93]

3 minutes ago, CdnFox said:

No it doesn't. And stop using words unless you know what they mean. 

This has nothing to do with quantitative easing. It has nothing to do with interest rates either.

This is very simple.  Due to red tape and tax policy, we stopped building enough homes. There was a day when developers said "how many homes will we need next year?" and built those.  Now they say "how many homes do we need right now", and they START to build those but it'll take 3 years of approval process and permits - by which time that number of homes isn't even close to what we need.

Interest rates doesn't change that.  Money supply doesn't change that.  Inflation doesn't change that.  The only thing that DOES change it is it gets WORSE when things are unstable, like interest rates are fluctuating. 

Developers need to be incentivized to build faster and build ahead of need again, and local and provincial gov'ts need to be told to get out of their way. Then  we need to slow down immigration for a short time to let our supply catch up

I don't foresee any significant price drops because of government intervention

people who believe the government will save them will end up with what they deserve

I have no sympathy for those people / shrugs

[CdnFox]

3 hours ago, Dougie93 said:

I don't foresee any significant price drops because of government intervention

people who believe the government will save them will end up with what they deserve

I have no sympathy for those people / shrugs

well as we've seen you don't understand the problem so your lack of vision on how to resolve it is no surprise.

In the end this is largely a gov't caused problem. The gov't will inevitably be part of the solution.

 

What's curious is why Justin isn't even pretending to be part of the solution never mind actually doing something which he could do.

[Dougie93]

2 hours ago, CdnFox said:

well as we've seen you don't understand the problem so your lack of vision on how to resolve it is no surprise.

In the end this is largely a gov't caused problem. The gov't will inevitably be part of the solution.

 

What's curious is why Justin isn't even pretending to be part of the solution never mind actually doing something which he could do.

the problems have all been caused by government intervention

decades of the central bank interfering in the bond markets to keep interest rates at net zero

the central bank,  at the behest of government,  is flooding the economy with newly printed dollars

this is why everything is so expensive

Justin Trudeau dumped $600 billion unto the street in a single year

no wonder the price of assets went through the roof

Justin Trudeau is the big government interventionist

more of the same is not opposing Justin Trudeau