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2019 Election| Availability and Affordability | Canada | May 2019
The document discusses the rising housing affordability issues in Canada and globally, emphasizing the need for government intervention to address systemic challenges. It highlights various contributing factors, including housing prices, governmental policies, land issues, and potential solutions like 3D printing technology. The conclusion advocates for a comprehensive review of urban planning and the integration of new technologies to enhance housing affordability.
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2019 Election| Availability and Affordability | Canada | May 2019
- 1. How to makeHousing more Affordable Paul Young CPA, CGA June 14, 2019
- 2. Paul Young -Bio • CPA, CGA • Financial Solutions • SME – Risk Management • SME – Close, Consolidate and Reporting • SME – Public Policy • SME – Financial Solutions • SME – Supply Chain Management Contact information: Paul_Young_CGA@Hotmail.com
- 3. Agenda Housing affordabilityindex Real Estate – Housing Starts and Real Estate Prices Systemic issues with Real Estate 3-D and Home Building What’s next
- 4. Introduction More isrequired by all levels of government to deal with the systemic issues facing real estate. This presentations looks at key areas facing housing prices across Canada and the world.
- 5. Housing Affordability Index Source- https://www.numbeo.com/property-investment/rankings_by_country.jsp 2019 2015
- 6. “'The realityis that too many Canadians cannot afford to buy a house,' the Liberal leader Justin Trudeau said CBC News [ Posted: Sep 09, 2015 9:10 AM ET - September 9, 2015 ”Source - https://www.cbc.ca/news/politic s/canada-election-2015-justin- trudeau-affordable-housing- 1.3220479 Liberal Party of Canada / Housing “More eco-friendly homes which could cost home owners up to $35,0000 in costs” Source - http://www.enerquality.ca/2017/11/0 8/tighter-building-codes-ottawas- next-climate-target-cost- homeowners-35000/ • The Harper government introduced its ecoENERGY Retrofit program as part of its massive stimulus package during the recession, which was granted to more than 250,000 homeowners in Canada. The program provided homeowners up to $5,000 to retrofit old insulation, doors, windows and rooftops with more eco- friendly alternatives. – Source - http://www.enerquality.ca/2017/11/08/tight er-building-codes-ottawas-next-climate- target-cost-homeowners-35000/ • This was part of the 2009 Stimulus Package pushed by both the NDP and Liberal Govt Summary • Housing is no more affordable under Trudeau - https://betterdwelling.com/canadian-mortgage- growth-plummets-to-the-lowest-levels-since- 2001/ • Liberals policies would push up the cost of both existing and new homes • Any retro-fit policies only grow if there is incentives by the govt. • Short-lived reprieve. RBC’s main affordability measure for Canada in the first quarter reversed the slight improvement it saw late last year http://www.rbc.com/newsroom/_assets- custom/pdf/20180703-ha.pdf Liberals Eco Home CPC – Eco-Fit Programs
- 7. Canada Housing Market– May 2019 • Home prices rose 8% y-o-y in Ottawa (led by a 12.2% increase in townhouse/row unit prices), 6.3% in Greater Montreal (led by a 7.6% increase in apartment unit prices), and 2% in Greater Moncton (led by a 15.9% increase in apartment unit prices). • The MLS® HPI provides the best way to gauge price trends, as averages are strongly distorted by changes in the mix of sales activity from one month to the next. • The actual (not seasonally adjusted) national average price for homes sold in May 2019 was close to $508,000, up 1.8% from the same month in 2018. • The national average price is heavily skewed by sales in the GVA and GTA, two of Canada's most active and expensive housing markets. Excluding these two markets from calculations cuts almost $111,000 from the national average price, trimming it to just under $397,000. Source – https://www.newswire.ca/news-releases/canadian-home-sales-rise-again-in-may-2019-886083799.html
- 8. “Canadian homeprices rose in May as Toronto remained robust despite recent government efforts to cool the market, while prices in Vancouver picked back up to hit a fresh peak, data showed on Wednesday. The Teranet-National Bank Composite House Price Index, which measures changes for repeat sales of single-family homes, showed prices rose 2.2 per cent last month. Prices were higher in all 11 cities included in the index, led by a 3.6 per cent increase in Toronto and a 3.1 per cent rise in nearby Hamilton.” http://www.bnn.ca/toronto-housing-market-stays-hot-as-canadian-home-prices-rise-in-may-1.778739 http://www.huffingtonpost.ca/2017/06/20/household-debt-canada-pbo-report_n_17227374.html Analysis There is issue with land, especially in major cities. Government have brought in legislation to protect sensitive areas from development http://www.mah.gov.on.ca/Page195.aspx British Colombia introduced foreign buyer tax to curb high price of houses - http://business.financialpost.com/personal-finance/mortgages-real- estate/cmhc-data-shows-foreign-buyers-have-almost-disappeared-from-vancouver-market Bids and asks for property are getting ridiculous. http://www.cbc.ca/news/canada/kitchener-waterloo/kitchener-waterloo-2016-real-estate- bidding-wars-from-toronto-buyers-1.3622610 There are old industrial sites also known as brown sites. The cost of cleaning up brown sites is very expensive. http://warming.apps01.yorku.ca/library/wp-content/uploads/2013/03/NRTEE-Cleaning-up-the-Past-Building-the-Future.pdf mortgage rules allow people to enter the market when they likely should not. The mortgage approval process should look at net income as well as look at the ability to cover operational expenses for a house. http://www.statcan.gc.ca/daily-quotidien/160212/dq160212a-eng.htm Federal government can set mortgage amortization period as well as thresholds for CMHC insurance. However, the federal government cannot control areas, like land or real estate commission as they are either municipal or provincial jurisdiction. http://www.queensu.ca/iigr/sites/webpublish.queensu.ca.iigrwww/files/files/conf/Arch/03/03-2/Hulchanski.pdf PBO Office – Housing Affordability - http://business.financialpost.com/personal-finance/why-its-time-for-canadas-financial-industry-to-put-the- customer-first/wcm/433faa13-8531-4a01-9a47-229ac1220a87 Source: https://www.slideshare.net/paulyoungcga/housing-market-canada-may-2017 or https://www.slideshare.net/paulyoungcga/canada- affordability-housing-crisis-june-2017 Blog – Housing – Systemic Issues
- 9. 3-D Printing andHousing Source - https://www.scmp.com/news/world/united-states-canada/article/2137538/can-3d-printers-make- cheap-homes-worlds-poor or https://www.aniwaa.com/house-3d-printer-construction/ 1. Overall 3-D Printing market is predicted to be 35B by 2024 - https://www.forbes.com/sites/tjmccue/2019/03/27/wohlers-report-2019-forecasts-35-6-billion-in-3d- printing-industry-growth-by-2024/#5892814d7d8a 2. Houses can be built for $4,000 (USD) - https://www.businessinsider.com/3d-homes-that-take-24-hours-and- less-than-4000-to-print-2018-9 3. Environmentally friendly - https://3dprintingindustry.com/news/is-3d-printing-really-as-ecofriendly-as-we- think-it-is-136335/ 4. 3-D Housing with First Nations and Northern Countries - https://www.northernontariobusiness.com/industry-news/design-build/test-3d-printed-homes-for-northern- communities-report-1142349 5. More and more players are entering the 3-D Printing of Housing- https://www.artsy.net/article/artsy- editorial-inside-race-perfect-3d-printed
- 10. What’s next forgovernment There needs to be a review of urban planning as part of smarter urban planning - https://www.slideshare.net/paulyoungcga/urban-planning-issues-facing-urban-planners-april-2019 There is a shortage of the skills trades. A better strategy is require to support the skill trades as well as other skills to support real estate market - https://www.slideshare.net/paulyoungcga/2019-election-careers-skills-training-education- canada-may-2019 Better market valuation that ties housing prices to wage growth, inflation and after tax income, etc. - https://www.slideshare.net/paulyoungcga/2019-election-wages-canada-march-2019 Better management of supply, i.e. brown sites, rural land, etc. All levels of government need to come up with integrated solutions as part making housing more affordable. Adopting new technology including 3-D Printing of housing Clamping down on foreign ownership, especially money laundering, speculators, etc.