Too many governments think they have a fixed for housing prices. The problem is that it takes combination of policies to fix the systemic issues with out of control housing prices. You do not fix a problem with a leak in the dam through plugging one hole. So, you cannot fix real estate pricing with one off policies.

1. CANADA HOUSING
AFFORDABILITY CRISIS –
JUNE 2017
PAUL YOUNG CPA, CGA
JUNE 9, 2017

2. PAUL YOUNG - BIO
• CPA, CGA
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Financial Solutions
Contact information:
Paul_Young_CGA@Hotmail.com

3. OVERVIEW
• Too many governments think they have a fixed for housing prices. The problem is that it takes
combination of policies to fix the systemic issues with out of control housing prices. You do not fix a
problem with a leak in the dam through plugging one hole. So, you cannot fix real estate pricing with
one off policies.

4. AGENDA
• Housing Prices
• Cost of Housing
• Root Cause vs Symptom – Resolving Problems
• Summary

5. AVERAGE HOUSING PRICES
Average Canadian
house price $450,180
May 2015 May 2016
Average house
price in Canada
jumps 13% to
$509,460 in March
from year earlier
April 2017
The average house
price in Canada for
April 2017 is $603,369
or about 10% from
March 2017
• Housing affordability continues to worsen
• Wages, GDP and Inflation are not keeping pace with growth in housing prices
• There is no quick fix to solving the affordability of housing. It will take all levels of government including the
private sector to fix the systemic issues with the housing market.

6. GRAPH – AVERAGE HOUSING PRICES - CANADA
• CBC, Stats Canada and Canadian Real Estate Board

7. HOUSEHOLD BUDGET
• Source - Stats Canada

8. HOUSING
Housing Cost
• Raw Material
• Assembling
• Building Permits
• Land Transfer Taxes
Issues:
• Availability of Land
• Government regulations
• Qualifying for Mortgages
• Market value assessment
• Bids and Asks

9. BANK OF CANADA / HOUSING MARKET
• http://globalnews.ca/news/3512390/housing-market-a-growing-threat-to-financial-stability-bank-of-canada/

10. GOVERNMENT MISTAKES WITH HOUSING
• Analyzing the symptoms and not the root cause

11. Government has a habit of looking for a quick fix. Quick fixes
rarely fixed systemic issues when it comes to government
policies

12. LIBERAL PLAN / HOUSING
http://www.lfpress.com/2017/04/20/ontario-to-tax-non-resident-foreign-housing-buyers-15
Toronto - Moments after introducing a package of measures designed to cool the GTA’s red-hot housing
market, Premier Kathleen Wynne conceded she’s open to doing more if her plan doesn’t work.
Wynne made the much-anticipated announcement on the housing market and new rent controls with
condos in one of Toronto’s trendiest neighbourhoods as her backdrop.
The 16 measures include the imposition of a 15% foreign speculators tax and closure of a loophole that
allowed landlords to raise rent by any amount on units built after 1991.
• BC used the foreign buyer tax and it did have an impact on housing prices. However, prices are now going back
up in BC.
• Liberal are only acting now as they are trail in the polls. No action to control spiraling housing prices happen
over their term in office
• There are more issues facing real estate
• Building Permits
• Land Transfer Taxes
• Availability of Land
• Proper market value assessment
• Mortgage approval process (tied to net income)
• Raw Material/Labor Costs
• Brown sites cleanup

13. SUMMARY / REAL ESTATE
• All levels of Government
• Needs to fix the root cause when it comes to solving problems, not try to fix the symptoms
• Government -
• Mortgage Rules
• Review land transfer taxes
• Building permits
• Availability of Land
• Infrastructure (Roads, Bridges, Transit, etc)
• Banks need to enforce better market valuation as part of assessing mortgages
• Wage growth
• Inflation
• GDP
• Original cost of the property