So this graph will give you a pretty clear indication as to where we are in the real estate cycle. Sales are up over 20% over the last year and listings are down 37%.
The media keeps covering the issue of rising prices in Toronto and Vancouver and most have attributed it to the foreign buyers (which helped implement the Foreign Buyer Tax) but no one is talking about the biggest issue at hand.
The lack of inventory is something that needs to be addressed immediately. No matter what the government does, you will not be able to legislate away demand. The FTB and the new lending practices are the most recent changes. The market will reflect these changes in the short term but it is not solving one of the biggest issues which is the lack of supply.
We need more rentals. We need more affordable housing. We need to increase housing across the board. We need the government from the municipal level all the way to federal to help facilitate the necessary changes.
I'm talking about making basement/accessory apartments easier to get approval, increase density in more areas, reduce development charges for builders, fast track land in the secondary act, push back borders for the greenbelt etc.
I don't have the solutions but what I do know is we need to act fast as the situation will only become more dire for the younger generations.
Also, this is not about the benefits of home ownership. I am not predicting what is going to happen to house prices in the future. This pertains to everyone since the lack of inventory will put pressure on the rental rates as well. This will affect us all.
Any questions or comments, feel free to share or contact me directly. [email protected]
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