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Old Posted Oct 13, 2017, 8:59 PM
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How would you solve the housing affordability crisis?

This seems to be the topic on everyone's mind these days - at least for those of us in Toronto & Vancouver - being that the current order of things is looking pretty bleak for everyone but the landed gentry, and is at the point where it's become actively detrimental to the economic & cultural life of the city. It's particularly pertinent to me at the moment as I'm looking for a new apartment, but even with a well-above average income it seems like I can no longer afford much beyond a bed bug-infested slumlord building or a basement in the far reaches of Scarborough.

The housing market needn't even be a consideration for most, while rental vacancies are at historic lows, and any half-decent, semi-reasonably priced apartment is snatched up within hours (that is, if it doesn't spark a rental bidding war first). Between that, and the near-daily reminders in the media of the unaffordability of the market, it's hard not to feel kind of dispirited by the whole thing.

So I'm interested in hearing what ideas you people have on how we might be able to fix this. Without getting too heavily into the financial side of things, these are my suggestions from a mainly zoning/planning-related perspective - some of which are Toronto-specific, but most could be used elsewhere as well:

  • Create a more extensive heritage inventory and a more rigorous approvals process for proposed redevelopments of existing building stock. Aside from protecting heritage stock, this would have the effect of suppressing existing home values as they lose their redevelopable potential. Conversely, streamline the development process for proposals on undeveloped and undeveloped land - like vacant lots, laneways, brownfield sites, parking lots, tower-in-the-park infill, etc. Encourage new construction where none exists currently to flood the market with new units without causing displacement.

  • Get rid of the Single-Detached zoning designation entirely, and replace it with a broader Small Residential zone that would also allow for small apartment buildings (say, up to 4 stories/8 units), townhouses, and duplexes in traditionally SFH neighbourhoods.

  • Make it easier to subdivide buildings & lots. Allow accessory buildings. Relax constraints on lot coverage, height limits, and setbacks for multi-unit buildings.

  • Mandate that a certain percentage of units (with an appropriate mix of unit types/sizes) in all new developments above a certain size must be given over to and administered by Toronto Community Housing as affordable housing. I'm not sure what the magic proportion would be, but it should be high enough that the TCHC can get out of the business of building new public housing units, and low enough to ensure that development is still viably profitable.

  • Put minimum requirements in place for the proportion of 2 & 3+ bedroom units that all new developments of a certain size must have, to increase the stock of family-sized units (right now, 3-bedroom condos are so uncommon that they're often even more expensive than a house). And while we're at it, amend the provincial building code to stipulate that a "bedroom" must have a window to the exterior - I'm tired of dark closets with frosted glass doors passing for bedrooms.

  • Further increase taxes on foreign buyers and flippers of pre-construction units; and add a luxury tax for owners of multiple properties that are not used as rentals.

  • This is something important for a whole bunch of other reasons as well, and is slowly but surely happening already - but improve regional transit, with the aim of making far-flung, lower-cost areas more accessible, so people don't have to choose between an unaffordable home in the core or a nightmarish commute.
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  #2  
Old Posted Oct 13, 2017, 9:08 PM
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In larger cities, I'd expand public transit as the foundation of any attempt at controlling the cost the housing. If everyone living an hour's drive outside the core can get downtown in 30 minutes... it makes far-flung places less inconvenient while still affordable. And you reduce the increased price of being near transit because most areas are.

In St. John's, our issues are different. There are no foreign buyers excluding American philanthropists in the heritage preservation market (and it's surprising how many there are, and how much they spend; the entire town of Bonavista's resurgence is funded by Americans; there's nary a Canadian dollar being spent there). What we have is an exceptionally large lower class, and a large number of them couldn't put on enough of a facade to not stand out at even a Boston Pizza. Outside of the nicest neighbourhoods, we have an exceptionally cheap core and very expensive (relatively) suburbs.

So, being this far behind, what we need is what the larger cities have already done - mixed-use neighbourhoods, continued and enforced requirements for a certain number of affordable housing units in every development (whether it's a single multi-residence building or an entire subdivision). We need better community-based mental health and addictions support to get the most outcasted into their own core homes. And, most importantly in a moderately touristy town, we need to regulate Air B&B such that the owners of the home or unit are required to live on-site, which will eliminate most of the cannibalism of would-be, long-term rental units.
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Old Posted Oct 13, 2017, 9:52 PM
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This is a easy answer for me. The solution is so simple and yet no one openly discusses it.

Cut the immigration quota in half to 150 thousand
Problem solved overnight. Actually most of our big problems would be solved over night with this one simple move.

Also cut down other streams like 10 year visas, international students, TFW's etc. to sustainable levels.

I find it incredibly that people over think this topic so much when the whole problem is because one thing thst we have full control over. Immigration rates which are way too high. Cur them down. It's like someone drowning debating how to remove the water from the ocean instead of thinking about learning to swim. It's all on the wrong track and will solve nothing. The only solution is with immigration policy.
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Old Posted Oct 13, 2017, 9:59 PM
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Outside of the larger cities, we can't afford that. The presence of temporary foreign workers and immigrants is too... for example, the Sears store closing in St. John's. 190 people out of work. You can count on one hand the number not from the Philippines. Same with the fast food industry, etc. We're at a point now where our province could not function without workers from poorer countries in the service industry. We have fish plants in towns with 25% unemployment where the workers are half Thai because locals wouldn't do it. Disgusting. But... legal?

I think if Canada ever restricts immigration further, which I completely disagree with, there should be introduced some middle level of residency that is restricted to a province. So you can come, but before you become a "Permanent Resident", you become a "Nova Scotia Resident" for some period of a few years. Maybe get rid of "Permanent Resident" and replace it with a province-specific one. Then we could help the areas with obscene demographic challenges, like my own. St. John's is younger than the Canadian average and doing well enough, but the rest of the province is the fastest-aging with a declining population (we're expected to be in the high 400Ks in just a generation, compared to 570+K in the 1980s).
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  #5  
Old Posted Oct 13, 2017, 10:09 PM
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Vancouver needs to build at least 100,000 more rental units by 2020, and Toronto 300,000.
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Old Posted Oct 13, 2017, 10:44 PM
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Cutting immigration isn't the answer. I'm a Brit immigrant, but my wife and kids are Canadian, they would still require a house whether I was here or not.
But for sure heavier taxes on foreign investors who never live in the property, and even bigger taxes on those that buy condos to flip and sell before the building is even open would help slow the rising house prices. My wife's hobby is browsing MLS and other real estate website looking at house prices and what you get for given $'s. Since the initial tax on foreign investors was introduced several months ago we've noticed a slow down on rising prices, and even drops in some areas. Admittedly correlation does not equal causation, but I would certain postulate there was some link.
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Old Posted Oct 13, 2017, 10:45 PM
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I don't think there can be a blanket solution unfortunately. In Vancouver (and Toronto I suppose... not familiar with that market) there is not going to be any substantial change without significant intervention in the market. Places like Edmonton are extremely bubbly, and right now there's lots of affordability in the market.

One place where affordability is a big problem also are smaller cities where there are some external forces at play. Growing demand and prices in places like the Okanagan Valley have driven housing prices through the roof.
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  #8  
Old Posted Oct 13, 2017, 10:47 PM
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Stop trying to encourage seniors to stay in their homes as long as possible and do the exact opposite--get as many elderly as possible to downsize into condos as we can. This will fill the market with homes for resale which will provide massive amounts of low rise housing stock for young families without the need for any more sprawl.
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Old Posted Oct 13, 2017, 11:01 PM
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Stop treating high house prices as a good thing and stop caring if policies will have the effect of lowering house prices.
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  #10  
Old Posted Oct 13, 2017, 11:02 PM
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It might not be a bad idea to reintroduce the MURB tax shelter, i.e., accelerated depreciation on rental apartment building construction. It was a tremendous boon for housing in the 1970s. The RHSOP program from the same decade benefitted a lot of people then also.

MURB- Multiple Unit Residential Building
RHOSP - Registered Home Ownership Savings Plan
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  #11  
Old Posted Oct 13, 2017, 11:08 PM
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Quote:
Originally Posted by SignalHillHiker View Post
Outside of the larger cities, we can't afford that. The presence of temporary foreign workers and immigrants is too... for example, the Sears store closing in St. John's. 190 people out of work. You can count on one hand the number not from the Philippines. Same with the fast food industry, etc. We're at a point now where our province could not function without workers from poorer countries in the service industry. We have fish plants in towns with 25% unemployment where the workers are half Thai because locals wouldn't do it. Disgusting. But... legal?

I think if Canada ever restricts immigration further, which I completely disagree with, there should be introduced some middle level of residency that is restricted to a province. So you can come, but before you become a "Permanent Resident", you become a "Nova Scotia Resident" for some period of a few years. Maybe get rid of "Permanent Resident" and replace it with a province-specific one. Then we could help the areas with obscene demographic challenges, like my own. St. John's is younger than the Canadian average and doing well enough, but the rest of the province is the fastest-aging with a declining population (we're expected to be in the high 400Ks in just a generation, compared to 570+K in the 1980s).
I kind of like that idea. Instead of having a 5 year residency requirement for citizenship, make it an 8 years in a small province residency requirement (less than 2 million population). This increases immigration to provinces that need it most while simultaneously reducing overall immigration. Problem solved!
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  #12  
Old Posted Oct 13, 2017, 11:12 PM
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End foreign ownership of housing, period.

Crack down on corrupt developers. They are the new mafia. No more political donations to city council members, for one.

Put tons of funding into proper transit and road infrastructure that has been crumbling and/or bursting at the seams since the money laundering bubble started.

Make it socially acceptable for more expensive urban areas to have a higher minimum wage, pegged to cost of living. Vancouver's should be no lower than $20 per hour - there isn't a labour shortage in Vancouver like so many employers claim, there's a living wage crisis.
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Old Posted Oct 13, 2017, 11:13 PM
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Originally Posted by mistercorporate View Post
I kind of like that idea. Instead of having a 5 year residency requirement for citizenship, make it an 8 years in a small province residency requirement (less than 2 million population). This increases immigration to provinces that need it most while simultaneously reducing overall immigration. Problem solved!
That could seriously screw over low-density areas within big provinces, though (like Northern Ontario or the BC Interior).
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Old Posted Oct 13, 2017, 11:22 PM
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Originally Posted by GernB View Post
It might not be a bad idea to reintroduce the MURB tax shelter, i.e., accelerated depreciation on rental apartment building construction. It was a tremendous boon for housing in the 1970s. The RHSOP program from the same decade benefitted a lot of people then also.

MURB- Multiple Unit Residential Building
RHOSP - Registered Home Ownership Savings Plan
Yes, that's a great idea. We haven't figured out how to build corporate rental (i.e. not private landlords) ever since the Condominium Act came into play and made condominium development much more lucrative. Programs like the MURB might rebalance some of that.

I also think it's time that provincial governments got back into the housing game, not with little sprinklings of cash, here and there, now and then, but with dedicated crown corporations building and managing public housing. Public housing gets a bad rep and is usually associated with housing the poorest of the poor in the most utilitarian conditions, but in other developed countries - notably the Netherlands (at least Amsterdam) and Singapore - the majority of middle class citizens live in state-run housing. These are often indistinguishable from private developments from a quality standpoint, and built according to forecasted shelter needs, rather than for investment purposes.

I would arm our provincial housing authorities with new tools. Just like how transit projects in Ontario benefit from an accelerated environmental assessment process, the TPAP, I would create an accelerated affordable housing development review process, where most of the considerations are waived in favour of development. I would also give these new provincial housing authorities the ability to expropriate land for provincially-run affordable housing. I don't think many people can argue that affordable rental housing is not in the public's interest anymore.
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Old Posted Oct 13, 2017, 11:22 PM
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Originally Posted by mistercorporate View Post
I kind of like that idea. Instead of having a 5 year residency requirement for citizenship, make it an 8 years in a small province residency requirement (less than 2 million population). This increases immigration to provinces that need it most while simultaneously reducing overall immigration. Problem solved!
That's great - but (and this is in agreement with your point, not in contrast to it - just stating another way) the smaller province should be more attractive if both exist. Three years in a small province, or five anywhere else. If we get rid of the "anywhere else", then it should be five. I don't want to make it harder for people who come here, live here, work here, to become citizens.

But people will stay here if we keep them here long enough. We have Syrian refugees here who are cultivating farmland from our hills. And the province is changing its agricultural/crown land rules to make it easier for them to do this. Five years from now, and they become citizens? They're staying here. And we need them. We need more arrangements like that. Even the Syrian barbers... everyone here is getting their beards threaded and eyebrows microbladed. All of the Syrian trends are just the cool thing that you do... whether you're a 17-year-old at a downtown high school or a suburban, married 40-something. Even outside the capital: http://www.cbc.ca/news/canada/newfou...rber-1.3591382 They've already completely replaced the local trends.

We need to do everything we can to make such people stay not just in Canada generally, but specifically, here. In the "middle of nowhere" by comparative Canadian importance.
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Old Posted Oct 14, 2017, 6:21 AM
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Originally Posted by GernB View Post
It might not be a bad idea to reintroduce the MURB tax shelter, i.e., accelerated depreciation on rental apartment building construction. It was a tremendous boon for housing in the 1970s. The RHSOP program from the same decade benefitted a lot of people then also.

MURB- Multiple Unit Residential Building
RHOSP - Registered Home Ownership Savings Plan
I agree MURBs should return. In addition cities like Toronto and Vancouver should only be approving multiunit rental, not strata titled properties. That would quickly show what the demand is for homes at local wages by taking the investment card out of the equation.
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Old Posted Oct 14, 2017, 4:00 PM
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If we didn't have immigration, many stores and fast food chains would simply close their doors. Right now, in many parts of Quebec, some fast food restaurants are closed during the night (some McDonalds and Tim Hortons) because there's no labour to hire. Shortage of employees everywhere. Nobody wants to work at minimum wage (11.25$ in Quebec), and if it stays that low, it won't attract anyone born here to apply for these jobs. We need these newcomers looking for a headstart and a starter job. There's a shortage of students who apply to work on the weekends, shortage of newly retired workforce looking for a part-time job after their career, shortage of adults looking for full-time jobs (the salary and the benefits are not attractive).
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Old Posted Oct 14, 2017, 4:52 PM
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If we didn't have immigration, many stores and fast food chains would simply close their doors. Right now, in many parts of Quebec, some fast food restaurants are closed during the night (some McDonalds and Tim Hortons) because there's no labour to hire. Shortage of employees everywhere. Nobody wants to work at minimum wage (11.25$ in Quebec), and if it stays that low, it won't attract anyone born here to apply for these jobs. We need these newcomers looking for a headstart and a starter job. There's a shortage of students who apply to work on the weekends, shortage of newly retired workforce looking for a part-time job after their career, shortage of adults looking for full-time jobs (the salary and the benefits are not attractive).
Sacre bleu! You mean people aren't able to get McNuggets at 3 am? Oh the humanity. If it's that important they should pay more. In addition we could go back to the days where the mentally slow and poor didn't automatically get a government cheque and had to work at whatever job was available to put food in their mouths. It's insane to say we need to bring workers from halfway around the world to sling Big Macs in the middle of the night.
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Old Posted Oct 14, 2017, 5:46 PM
YannickTO YannickTO is offline
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Sacre bleu! You mean people aren't able to get McNuggets at 3 am? Oh the humanity. If it's that important they should pay more. In addition we could go back to the days where the mentally slow and poor didn't automatically get a government cheque and had to work at whatever job was available to put food in their mouths. It's insane to say we need to bring workers from halfway around the world to sling Big Macs in the middle of the night.
Don't get me wrong, I agree with you, but there's more to it. Some business owners are closing doors, reducing hours, they lose money fast, can't afford to open new locations, affects the daily staff with reduction of staff as well, etc etc.

Night shifts are made primarily for cleaning equipment, cleaning the store, starting the next day's production, and other backend duties. You need to look past the drunk guy who wants a big mac at 3am. Some customers arrive in droves at 4am for breakfast already. There's no staff or it's closed. It's a lot of money being lost.
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Old Posted Oct 14, 2017, 6:00 PM
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I would agree with all the suggestions in the original post except I'd take issue with this one:

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Originally Posted by MonkeyRonin View Post
[*]Put minimum requirements in place for the proportion of 2 & 3+ bedroom units that all new developments of a certain size must have, to increase the stock of family-sized units (right now, 3-bedroom condos are so uncommon that they're often even more expensive than a house). And while we're at it, amend the provincial building code to stipulate that a "bedroom" must have a window to the exterior - I'm tired of dark closets with frosted glass doors passing for bedrooms.
Wouldn't putting more restrictions on the size and type of housing stock provided actually increase prices by giving developers less flexibility and few options for new buildings? For the larger units, if there was higher or equal demand for them they'd sell at an equal or higher cost per sq meter making it profitable to build more without developers being forced, and if not the restrictions would cause the cost per area to drop and thus act as a subsidy paid for by people buying the smaller units - making them less affordable. And for the window requirement, forcing developers to add amenities or features to units and forcing consumers to pay the embedded cost whether or not they'd be willing to forego them to reduce cost, seems more like an issue of quality rather than affordability.

One thing that i would say, is that it's somewhat natural for there to be price fluctuations when you have big discrepancies in terms of some regions attracting far more newcomers - and thus growth - than others. If it was just from domestic migration, it would balance itself out more, since the areas that were attracting people for economic or quality of life reasons will also generate a repelling force as prices rise and thus offset the economic benefits and reduce quality of life. This would eventually reach an equilibrium. But with foreign immigration, the lure of being near communities of people with whom you identify is an additional (and powerful) attractor in some regions allowing prices to get much higher before that equilibrium is reached.

However, to a large extent the high prices are the solution, rather than the problem. High prices means that the market springs into action providing huge volumes of supply - which is exactly what we've seen in the highest growth markets - and this supply is much harder to come by when prices are low since large volumes of new construction needs to be funded. And considering these costs, restricting foreign money from helping to finance the supply may also not be the best option.

The suggestions that I agreed with are mostly aimed at reducing the restrictions around increased supply, while the ones I take issue with would actually place restrictions or complications on supply. But overall, if we want significant growth - particularly from immigration - then we need to accept that there will be growing pains, which in this case include a (hopefully brief) period of elevated housing costs. Some will argue that immigration should be reduced, while others will argue that the long term costs of low population growth and an aging population would be higher than the short term pain involved in accommodating new residents. My guess is that the latter is probably true and that this isn't much different than many other things such as infrastructure investment that are worthwhile in the long term, but pricey in the shorter term. And just as with those many other things, you'll never get everyone to agree.
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