Stop championing scarcity by blaming scapegoats. Either we limit Canada's crazy-high immigration rate (1% of population every year) or we build more homes which is mostly gated by illiberal zoning laws passed by municipalities. But both of these policies are very popular so you'll be swimming upstream, politically.

While you're at it, you could go after other wildly popular policies that lead to high housing prices, like the primary homeowner capital gains tax exemption (probably, by value, the biggest tax dodge in the industrialized world), and Canadian cities' extremely low property tax rates (0.3% of assessed value in Vancouver, for example).

No, they're fighting market inefficiency. A free market requires accurate and timely information to be efficient. This is literally people putting constraints on the market for what they are selling so the information is not available to one side, and the price is inflated.

A rational actor should walk away from a system like this, but if that's all that's available around you because of scarcity, you're forced to work at a disadvantage.

Banning this is akin to banning other anticomptitive behavior, such as collusion and monopolies. That is, it's up to the government to decide whether the harm outweighs the problems regulation introduces (regulation always introduces some level of friction and problems, you just hope to minimize them and maximize the benefits it brings) and is thus worth pursuing.

In a world where there was enough housing supply, you would just walk away from a blind bidding auction since it's a pain, and buy a bigger house for cheaper across the street.

That scarcity exists is the whole reason we're focusing on foreign buyers in 2022. And blind-bidding in 2021. And investors in 2019. And money-laundering in 2018. And Chinese money in 2017. All of these things should be addressed, but every one of them has provided political cover for the real reason that housing is so expensive in popular cities, which is scarcity.

None of these things will matter one whit to housing affordability. "Helps in some way" is fine as long as we understand that it has nothing to do with high housing prices. "Helps in some way" is fine as long as we measure our claims and admit that this is about basic fairness and respect for the law. "Helps in some way" is alright except that "helps in some way" has been sold for the last 6 years, politically, as, "this is the reason you can't buy a home! Surely it has nothing to do with NIMBYism and our suburbs! Please don't ask me, as your elected representative, to take on suburban voters and start talking about housing equity as it relates to affordability!"

Every one of these things should be dealt with. Canada should probably have anti-racketeering laws. Real-estate boards should have less power and should be compelled to publicize their sales data. Etc, etc, ...

Just quit the bullsh*t about this being about addressing housing affordability.

This isn't really true though. Housing is expensive everywhere, even in unpopular cities, even in cities losing population. (Except for a few specific cities), housing is not scarce, we just pretend it is because we pretend all these fake financial transactions count as valid 'demand'.

> we're focusing on foreign buyers in 2022. And blind-bidding in 2021. And investors in 2019. And money-laundering in 2018. And Chinese money in 2017. All of these things should be addressed, but every one of them has provided political cover for the real reason that housing is so expensive in popular cities, which is scarcity

And why is housing "scarce"? Because we waste housing on fake buyers (every single thing you just mentioned). That's why it's all in focus so much.

My midwestern city has built 2x to 3x more housing units than it's received in new residents, for almost 15 years straight now, and housing still goes up 15% each year like clockwork. You can outbuild new resident growth (many places already do), but you can never outbuild investor demand while housing is federally forced to appreciate like this.

I'm so sick of people bullsh*tting that 'zoning' and 'nimbys' are why housing is expensive, when we have dozens of major cities with no meaningful zoning restrictions, no 'nimbys', and no restrictions on growth or construction of any kind -- and even in these cities, housing is shit and expensive.

Calgary? Its a hugely popular city, with a similar growth rate as vancouver and yet housing is much cheaper (relatively speaking)

> "Helps in some way" is alright except that "helps in some way" has been sold for the last 6 years, politically, as, "this is the reason you can't buy a home! Surely it has nothing to do with NIMBYism and our suburbs! Please don't ask me, as your elected representative, to take on suburban voters and start talking about housing equity as it relates to affordability!"

That isn't what the commenter you originally replied to was stating, nor was it my position. While your argument may have merit, it's a non-sequitur when used as a rebuttal to either that commenter or myself.

> Just quit the bullsh*t about this being about addressing housing affordability.

I get it, you have a point you want to make. There are more constructive ways to do so than to misconstrue the arguments of the people you are replying to.

The poster is literally responding to a news article about housing affordability with the declaration about blind-bidding, "This is such a huge deal".

It really isn't. This is the difference between English vs Dutch auctions and the relative merits in an open and sane market can be debated. Sealed auctions are not a market failure. Sealed auctions do not necessarily lead to higher bids. Sealed auctions do not necessarily lead to market asymmetries. The effects of these two auction choices is largely irrelevant as long as we have the demand curve pushed out to crazy-town.

Do research on the property! One of the big advantages of Dutch auctions is that bidders don't get information on how you value something! Except of course that everything is valuable because of scarcity so yeah actually I guess sealed bids won't really provide a lot of value for the buyer.

Adjust your bid as others bid! English auctions allow you to make lots of adjustments based on what other bidders think something is worth! Oh, except of course everything is in demand so everyone just keeps bidding and the frenzy makes other participants unpredictable... so yeah, actually I guess open bids won't really provide a lot of value for the buyer.

I get it, you have a point you want to make. There are more constructive ways to do so than to misconstrue the arguments of the people you are replying to.

I'm really just tired of the bs.

I disagree. Depending on the jurisdiction (in the US), part of the issue is the 10% net loss you end up with. 5-6% on the agent fee(s), another 1% on "mansion tax", in NYS/NYC there is a 1% and 1% transfer tax and 1/2% mortgage tax. Different jurisdictions are less (or more). Throw in more for the lawyer and you're down 10% on the sale. The sales agent fee seem fair for tough markets but even 1% sales agent fees seem preposterous given the market. If the house flips in 1 day, how is that worth 5 or 6%? These days people are negotiating that down to 4% but even that is preposterous given the market.

The problem with the extra 5 or 6% agent fees is: that people dont want to buy/sell as much, because you're effectively losing 20-30% of your 20% down equity on the sale (you'll lose more on the buy with the the 1-2% Title Insurance.) Effectively, you're losing half your 20% down equity.

Of course then...even if sellers want to sell, they dont because they need to bypass the frictional hurdles. Because if you sell and host half your 20% down equity, how the heck do you buy the next home?

The resulting price boom isn’t a mere 5-10% increase, but hundreds of percent over the course of only 5-10 years.

I’ve seen condo prices double three times in five years in places.

You forgot cheap debt. There's also a ton of speculation. Jack up those interest rates and see where we're at.

Making it too expensive to buy a home does 'help' with prices, but it's more like treating the symptom than the cause. The result is there still isn't enough affordable housing in places where it is needed.

Consider the long term consequences of this debt economy. We’re just kicking the can down the road. It won’t magically get better. The sooner we (society) learn that massively over borrowing has consequences, the better.

I agree though that building more housing (or maybe radically changing the way housing works) should also happen. Maybe once everyone wakes up from this real estate debt fantasy there’ll be the political will to actually do something about it.

Average house price in Canada has ballooned. It’s like a crypto scheme, only instead of a bunch of shady YouTubers selling it, we have an entire industry of snake oil pushers. I don’t think your average Jane really gets how ridiculous it is… yet.

My point is that if you reduce the red tape (and deadweight loss) there are actually people who want to sell, but wont sell if they are losing a ton of money on the sale. Reduce the loss and more supply appears.

In the US this is a huge issue. If you switch cities twice and sell each time, your entire downpayment has disappeared in fees/taxes. You literally have nothing left to buy your next home with. So people stick around in houses they dont want in cities without ideal jobs because they have no choice.

It is not that there are people that aren’t selling, it’s that there aren’t enough houses for the number of people in the country. House prices have risen enough to cover all of the fees, except that there is nowhere in the country you can move to where this isn’t happening.

(And if they are choosing to rent after they sell, that just shifts unaffordable home prices to unaffordable rents, as rental demand increases without a corresponding increase in supply.)

I've sold 3 houses myself, and bought 3 without a broker.

They are doing work, so the real question is whether you feel they are overcharging or not for whatever it is that they do.

Also, I think you meant to say "you lose practically every buyer WITH a buyer agent". This has not been my experience.

For given supply and demand if market was efficient the price of housing should have been a constant. I am guessing of course here there is an increase in demand also. (Which is what you perhaps you might mean as "scarcity?" Scarcity however has a separate definition.)

There’s indeed an order book that’s “public enough”, but not every trading system enters every intent into the public order book. (Even as a retail nobody, I can create contingent orders that only become public orders once the trigger conditions are met.) I also don’t believe that individual bid/asks can be traced to a specific bidder.

Further, block trades are negotiated off-order-book and later reported.

> Even as a retail nobody, I can create contingent orders that only become public orders once the trigger conditions are met.

Do different brokers implement this differently, or is this an a property of the exchanges themselves?

In terms of links, I don’t have a ready primer to vouch for. I worked 6 years in online broker tech, but it was decades ago.

I'm all for building more houses in cities/high demand areas, but doesn't Canada only have a population growth rate of around 1%/yr? It seems like you could easily build your way past that without giving up the advantages of immigration and a little population growth.

Densification is unpopular with existing municipal voters, and bankrupting CPP would be unpopular with federal voters.

My current city, Hamilton, is currently fighting with the Ontario government over this matter. The mayor is a regular feature on the local news and speaks to that often.

Their major push is for more density and resources for urban development. The provincial government has pushed for developing in Ontario's green belt and watershed instead. They've faced massive backlash over that to the point where they had to capitulate in some cases.

The current provincial government is the one pushing for downtown to be filled with parking lots and low-density housing developed outward. They're also responsible for nixing various transit and green power initiatives in favour of highway expansion. It's infuriating.

It does touch on building, but it's mostly about, "NOT IN MY BACKYARD!"

Council wasn't for intensification until they got the results of the poll back (and even then, the likes of Ferguson continue to be aghast at the idea of not being in the pockets of suburban developers).

We can see that with the kneejerk response to Bill 109, and the fact that only one Secondary Housing Unit has been approved by the city so far, the rest denied for what seem like vague reasons that won't hold up at OLT.

Back in the 90s they had a plan called "Vision 2020" that painted a dense, people-friendly Hamilton.

Now that 2020 has come and gone, the sprawl is crazy, downtown dead, transit gutted, and commuting by bike a near impossibility unless you're in the west end.

Some fun Hamilton transit facts: 1. There's an abandoned subway station underneath downtown. 2. There used to be a Funicular going up and down the escarpment. 3. When I was a kid many of the buses were electric, with overhead lines criss-crossing the streets like other cities have for trams.

(1) https://www.cbc.ca/news/canada/kitchener-waterloo/belmont-vi...

> hitting the limits of sprawl (congested highway commute time)

There's only so far you can bus, train, drive, bike, walk, seaplane, helicopter, hyperloop, or transporter in to go to work. Canadian cities are, just like cities in the US, hitting this limit rather aggressively.

In cities where sprawl isn't physically prohibitive, like Calgary or Toronto, the upper bound of "this shit ain't worth it" for time and money is a limiting factor. I know someone who commutes from Kitchener to Toronto on GO, so they don't even have to put up with driving, and they're debating moving back home to Winnipeg for a 40% salary cut just to not have to put up with it any more.

Remote work might help with this but even there, you have people who are moving "a little further out" but not leaving the region because they want to stay nearby for other reasons (or because they're not entirely convinced that full remote is actually on the table long term).

Canada's largest urban area is 5.6 million people. London, Paris and Seoul are around double that, NYC is 19 million and Tokyo is 37 million.

Why are Canadian cities hitting this limit at such a comparatively low population compared to other cities in the world? Why are all the major cities in the western world seemingly hitting this limit at the same time, even though they all have different populations?

It seems to me that we've just become less aggressive at building the infrastructure necessary to support population growth.

Toronto is suffering from the same problem Dubai has. It suddenly became relevant when sovereignists gained power in Quebec and the business class were worried about Montreal being a liability. So they packed up and went down the 401 to Toronto.

It has the infrastructure for a much much smaller city, and one in the North American car-driven style (massive highways, occasional regional rail that is artificially slowed down by regulation, little to no metro service in most areas, etc)

Combine with NIMBYs blocking every form of intensification, and here we are:

https://www.google.com/maps/@43.6783092,-79.352227,3a,90y,68...

A metro station close to the downtown core. In Tokyo this is the kind of development you find on the far side of Saitama, bounded by mountains or poor soil. In Toronto, this is an area that has suffered population decline, as the locals went from having a nuclear family to being 2 or even 1 empty nesters, being replaced by DINKs.

It gets much, much worse the further out you go.

A lot of the city has a blanket ban on anything more dense than a single family detached home.

Just look at the city's size in sqkm. It will never scale like this, things need to change and density needs to be improved.

All other Ontario cities suffer the same paste-eating mentality, especially Ottawa and cities in the GTHA.

If you look around the area, other than campuses like IBM's and CGI's, a very significant percentage of the business development in the area is still big box B2C (walmart/home depot/etc) or small-ish businesses. That's in stark contrast to areas like the financial district where the vast majority of workers are white collar office people. Which is to say, Markham/Vaughan could still stand to become much more metropolitan with the presence of more B2B big corps.

My pet theory is that concentration of white collar work is what drives up home prices. Exhibit A: places like Palo Alto and Mountain View in the San Francisco Bay Area (vs, say, Pacifica or Half Moon Bay) are clearly propped up by the presence of FAANG campuses. I'd bet that if a Google setup a campus in Ajax, you'd see an appreciable increase in demand for housing in surrounding areas even if they are traditionally considered too far from downtown TO (e.g. Whitby)

[0] https://www.google.com/maps/@43.842627,-79.3906732,3a,75y,20...

The high paying companies benefit from this when the markets are up, as their stock prices appreciate due to being able to compete in the market and remain highly paying companies. And when bubbles burst, their stock prices may go down, but so do their outlying obligations, which are denominated in dollars also. The gains made and invested into the company during the boom years allow strong companies to ride out the lean years better than their weaker competitors, whose workers are then in need of a job at one of the remaining companies unless they become or are already self-employed. This allows the strongest companies to get the benefit of both extremes of market conditions.

All of this causes metro areas, which are full of both established megacorps and VC-infused startups, to become pressure cooker bellwether barometers of property values and rent prices.

There are many ways to solve the problem of unaffordable home prices, and an answer is more supply. Why it isn't chosen more often is primarily a political problem inasmuch as it is a market problem, or land availability problem, or zoning problem.

I think at some point, even if the government were to scream "let there be more housing", there still needs to be private capital poured into these very expensive projects, and surely there must be a significant amount of analysis done to determine where it makes sense to put up condos, where amenities and other businesses sprout up in response, and rinse and repeat.

The side of supply where I think things get dicier is wrt wealth inequality. The real estate agent I used to buy my house had 3 mortgages of her own, it's an incredibly common thing for well-off people and real estate insiders to over-leverage on rental property mortgages. My wife had friends from China buying up property with corruption money given to them by their parents, it's been a thing since forever. There's no easy way to regulate who gets to buy houses and who doesn't.

I get what you’re saying, but didn’t Canada do just that? That’s not to say that it was easy, but I think it’s a step in the right direction.

Additional/secondary homes, and especially empty homes need to be taxed more to help disincentivize the anticompetitive behavior in the housing market that you mentioned.

But you're right, I don't think there's going to be a single action that solves the problem fully on its own, so taking it one step at a time is a good approach.

One of our chief problems is that there’s no interlock between development - whether dense or not - and public transit and other public infrastructure. London is still bisected by surface level train tracks with minimal above or below grade crossings; and in the seven years I’ve lived here nothing has changed.

We didn't build a single subway station for decades.

The solution is to enable density. Zoning in the US and Canada is done at the local level and zoning codes look like a list of things you can’t do. (You can have a house, but you can’t live with more than X unmarried people, you can have a home office but you can’t do hairdressing out of your home, etc.)

Zoning codes in Japan are a lot more relaxed, in that there are only about a dozen types defined by “maximum nuisance level.” Every additional level of zoning permits all the uses from the previous level as well. Which generally increases building capacity and density and lowers prices by staying ahead of demand.

It’s not just a matter of people’s preferences for cars, it’s not possible to build a non car city anymore due to pathologies that have nothing to do with “car culture”.

The number one issue is that we’ve allowed too many people and interest groups to effectively bring any major project to a halt. This is not some inherent feature of democracy either, you can have a democracy where the majority gets to do things. We just don’t have one of those in the US, or Canada it sounds like.

“Cars are land inefficient” isn’t a slogan, it’s literal fact.

> I live in NYC and we’ve built three brand new subway stations in the last fifty years

Ah, the stereotype of New Yorkers not paying attention to other cities strikes again! Yes, New York has its own problems, but for the vast majority of other cities GP’s comment is true. New York is one of the very few exception cases in the US.

> The number one issue is that we’ve allowed too many people and interest groups to effectively bring any major project to a halt. This is not some inherent feature of democracy either, you can have a democracy where the majority gets to do things. We just don’t have one of those in the US, or Canada it sounds like.

What if I told you that for a lot of transit activists, undemocratic processes that prioritize the needs of drivers over the rest of society is car culture?

Meanwhile complaints from a tiny number of affected people completely scuppered the high speed rail planned between Los Angeles and San Francisco before any track got laid.

Governments pull out the stops to complete car-centric infrastructure even over the loud complaints of the populace, but flinch the moment there is any push back against any public transit. Heck, trading on street parking for a bike lane is often a herculean effort.

Oh, and there's this little gem about the Big Dig "As of 2021, promised projects to extend the Green Line beyond Lechmere, to connect the Red and Blue subway lines, and to restore the Green Line streetcar service to the Arborway in Jamaica Plain have not been completed. Construction of the extension beyond Lechmere has begun.[20] The Red and Blue subway line connection underwent initial design,[21] but no funding has been designated for the project. The Arborway Line restoration has been abandoned, following a final court decision in 2011.[22]".

So once again, governments promised the moon about public transit and then did a rug pull once the highways were done. They in fact used this as an opportunity to destroy existing streetcar service. Exactly what we've been talking about.

> Or the new Kosciuszko Bridge?

Completed in 3 years. Again, we are really capable of building stuff, so long as that stuff supports cars.

That sounds pithy, but it overlooks all the maintenance work done on the system. Have you ever looked at pictures from the NYC subway in the 1970s? It was hell. (You can Google it.) My father lived in NYC in the 1970s and said the subway was like the "Fourth World" (vis-a-via first/second/third world!).

Also, how about PATH, Metro North, NJT, LIRR, AirTrain JFK, or AirTrain Newark? These are not the NYC subway, but they have also seen major upgrades in the last 50 years.

Finally, I tried to Google for list of stations opened from 1972. It could not find a concise list. I'm pretty sure it is more than three, just for NYC subway.

Have any metro areas built entirely new subways where there were none before in recent times? I know a lot of places are looking at light rail too, so have there been any greenfield light rail deployments in USA either?

It seems like a uniquely American problem, which leads me to believe that there just isn't political will to overcome the massive car lobby in most places, which is all the more reason to advocate for it, in my view.

I am not an urban planner but the north-south & east-west initial two-line style seems very popular. In my experience, the trick to quickly increasing ridership on new lines is closely coordinate with private developers. Be transparent about line planning, then team-up with private developers who can build (large) residential or office buildings with subway entrances in their basement. I've never seen a city do it better than Tokyo. My assumption is that the Elizabeth Line in London will spur similarly spectacular levels of redevelopment.

Light rail: Silicon Valley opened their system in Dec 1987.

About "unlocking value": Two massive upgrades come to mind. East Side Access in Manhattan will allow LIRR trains to enter Grand Central Station. The construction photos online are like something from science fiction. And look at last 30 years of Tokyo metro tightly integrating with private suburban rail lines where trains enter same station, but opposite sides of same platform. Everything is timed to the minute, so transfers are seamless.

None that I can think of in the US, but Madrid is generally pointed to as the stellar example of rapid and cheap subway expansion. They added an unbelievable amount of track and stations at really low cost.

> Between 1995 and 2007, the Spanish capital swiftly and cost-effectively upgraded its subway system, building more than 150 new stations over 120 miles at costs far below New York City rates. First, in just four years, Madrid designed, constructed, and opened 39 new metro stations and laid 35 miles of rail, 23.5 miles of which required new tunneling. The expansion was unprecedented for its low costs (about $65 million per mile of rail) and speed. Then, between 2000 and 2003, Madrid built Metro Sur, a 28-station, 25-mile circular subway line that connects the densely populated municipalities south of the city. Simultaneously, Madrid completed a direct metro line from the city’s central business district to its airport, now a 12-minute train ride away. Finally, between 2004 and 2007, commuters in the Madrid region gained an additional 80 new metro and light-rail stations, at a cost of $6 billion.

Just like high speed rail, this was less of a revolution in public works, and more a series of unglamorous minor improvements that added up to something greater than the sum of its parts. The government aimed for speed above all else, with the understanding that delays and financial uncertainty are the doom of any large project. So they would hire multiple teams to bore tunnels at once, and pit them in friendly competitions to bore faster. They negotiated with local land and business owners over more interruptions over a shorter period of time to reduce lawsuits (a big issue in NYC subway expansion), and they designed all the stations to be modular so that they wouldn't waste a ton of time designing and constructing bespoke stations. The sum is that they got it done really fast and really cheap.

Ironically, it looks a bit like the way that we construct our highways.

Sure, we have a good option for a significant majority of the time. But those many edge cases are non-trivial to resolve so a large majority of people will keep their cars for simple practicality sake.

https://www.nationalbcc.org/news/latest-news/1737-ca-high-sp...

Pointing out obvious symptoms without pointing out the causes can get this "kneejerk reaction".

I can’t speak for Canada, but in America the answer is always cars. Car based transit is wildly land inefficient, and the main reason why all car based cities hit their limit at the same time.

In particular there are two huge shortcomings with cars in urban design:

1. Parking eats up a huge amount of space. Either you let that drive density way down (which means commutes get longer) or you build underground parking at exorbitant prices driving up rents. Even in the latter case the roads around housing ends up becoming an issue, limiting density far below what you’d expect in say, Paris on Chicago.

2. Car transit to a shared destination is almost comically inefficient, which is really noticeable when people try and commute via car to job centers. This wouldn’t be as bad if we restricted cars to what they’re good at, such as driving away from the city, but most American cities have the unique psychosis of demanding that transit into the city center be via car. This does not scale, and is why places with wildly different zoning laws can have equally hellish commutes.

The issue is not that we can’t build, we’re really good at adding more highway lanes, it’s more that we are monomaniacally focused on building the wrong things.

If we had much more housing in tall buildings near where people worked then they either would not need a car or would at least not need to drive their car to work. You still of course need to provide parking but tall parking garages can solve that as well (or underground).

Seems like tons of cars are the symptom of the problem here not the cause

1) Taking the metro many places (for example, from my apartment in an urban "luxury" apartment building a couple blocks from the initial station to my boat near the waterfront in downtown DC) doubled the time it took to get there. It was actually faster to drive there even during rush hour where you'll sit motionless on the 395 bridge. Yes I can redeem a lot of that time with my above average personal mobile computing set up but a: most people have a pretty mediocre personal mobile computing setup and b: now I can't use that time for anything other than programming projects.

2) I couldn't get rid of the car entirely because I still needed it to move bulky things that I really can't take on transit. It's bad enough not having a truck but losing the car entirely would create some serious logistical problems on a regular basis. So while I saved some money I couldn't save as much as I wanted.

3) Most wealthy people (many of my friends) start families^ and people who can afford it buy detached housing for that. You're not going to be taking transit to these places. It might not ever be economical. Like it or not transit will probably always lower property values in the US too. For whatever reason the more violent people here tend to take it and anywhere it goes becomes more violent so building it into suburbs like these is always going to be unpopular.

4) Bringing me to the fact that I've been accosted multiple times on transit by people who were high, drunk, or just belligerent. I have an extremely high tolerance for this sort of thing (I've wandered around some of the more violent cities early in the morning just to see what the fuss is about) but I can absolutely see why most people here would give up after that happening once at a maximum.

I'm a huge fan of transit but pretending it isn't a large sacrifice to give up a car is just going to get people to ignore you, because it is and for most people it isn't worth it.

(^ and for those that don't start families, many have lots of intense DIY projects that don't fit in apartment buildings and actually need either detached housing or industrial space with similar density.)

Historically, and in some countries still, we solved this problem by identifying when it was happening and creating new public transport lines for faster commutes and people living further out. In the UK, we even developed whole "New Towns", upgraded their transport, amenities and infrastructure specifically to support shuttling a greater number of people into London. They weren't particularly inspiring towns, and we still make fun of them nearly a century later - but it worked. Even today, it's far quicker to take the train into London from those towns than it is to drive, as is the case for pretty much all suburb to central commuting here.

There are still lots of situations where a car will be better (I have one too, in London), but if we can get people out of their cars for their commutes, that frees cities up to expand and useful houses will become more affordable. Driving to the tip or mall is much less of a problem.

Regarding the violence and antisocial behaviour, that's really a problem of policing and allocation of funding. It needn't be that way and it doesn't happen to nearly the same extent in the UK and I put that down at least partially to the excellent British Transport Police. Apparently it used to be violent and dangerous in the 80s but we turned it around. Now the train stations are mostly far safer than the surrounding environs. If I was ever being harassed or attacked, I would run towards the station as there would most likely be someone to help me there. Living within a few minutes of a train station also significantly increases your property value here, provided you're not so close that it rattles your bed...

It’s also a matter of civil liberties.

In California, people have a constitutional right to defecate on the streets.

In was once in a San Francisco bus and watched a young woman of West Asian descent break down in tears because a homeless man was calling her a “sand n***”.

She screamed back at him the Trump was going to put him in a concentration camp. He made some comments about the Muslim faith, and she told she was going to pray he’d die a horrible death.

Some more words were exchanged about Trumps policies towards Muslims and the homeless.

She got off early and walked the rest of the way.

This is all 100% constitutionally protected, or at least, under the policies of subsequent DAs (including Kamala Harris) officially tolerated.

It also makes public transportation unusable.

Public transit is one of the few public spaces we have left, ironically. Perhaps especially so post-Covid. I think that it's worth the investments necessary to make it usable. You can't blame public transit for the lack of effectiveness of homeless programs, and some folks are homeless by choice. It's a fraught situation, and that's why folks choose cars a lot of the time. It's more convenient for them and I guess I don't fault folks for that, but the built environment shows a lot of deference for cars in many metro areas, and that doesn't help with the traffic issues, or with zoning issues, or with housing affordability.

Yet, if you improve those other issues, then property values will probably just go up even higher than they already are, but at least that money will benefit more than just the buyer and the seller; it will benefit the entire community.

In America it’s protected.

We have a jurisprudence that allows Neo-Nazis to March through Jewish neighborhoods.

Our public sphere is extremely permissive. So permissive that avoiding the public sphere is necessary to avoid anti-social behavior.

For example: You're upset that Nazis marched through a Jewish neighborhood. Are you upset about the violent BLM protestors marching through White neighborhoods? I would guess not but there's little difference between the two.

I've moved to places to see if I thought the changes improved things, you learn a lot about yourself and the world by doing that.

But that’s different from Nazis going around on a subway screaming racial insults at passengers.

For many passengers that would make the subway unusable.

Remember this thread is ultimately about “why public transit is better than people having cars.”

Antisocial behavior is a disadvantage of public transit, and in some cases makes it unusable.

I think keeping this conversation focused around public transit is a good idea.

Japan has one of the lowest crime rates in the world with heavy investment in public transportation & policing, and yet they still have issues with sexual harassment and sexual assault on their trains. It’s a hard problem to fix related to population density.

This smells of the coded racism that is so rampant in the USA. It's sad because there might be some element of truth at its root, but it gets exaggerated and the attitude creates more and more segregation, exacerbates the divisions and creates a hostile society.

Plenty of European cities have achieved this. I work in London and I wouldn’t even dream of driving into the city. It’s far more convenient to get the train.

I'm not against transit but it's not the solution people think it is.

And this is just looking at density in terms of population. There's also building density, London would rank very high up there and has excellent public transport.

The problem in DC isn't technical; the problem is cultural. You see the car as a solution so you keep investing in roads and under funding public transport. Whereas Europe took a different approach. Some UK cities have "park and ride" schemes where you parks on the outskirts and get a cheap bus into the city. Buses will have their own dedicated lanes too so aren't subject to congestion. Some of these cities even go as far as pedestrianizing chunks of the city center so the only way to access it is via subway, bus, tram or bicycle.

The benefits of improving public transport isn't just reducing congestion either. You improve the transport for the vulnerable (elderly, poor, etc), you improve the air quality in the city, you improve road safety. It's better for the environment, it's better for peoples health, it's better for moving people around. But it requires a cultural shift to happen.

Then both in terms of any arbitrary area in the US or any arbitrary city in the US, it's unusually dense (much more dense than the mean density.)

>Park and ride

Many places in the US have these and both DC and the suburbs around it are full of them.

I haven’t visited DC so I’ll have to take your word for it. But it should be noted that I can’t find anything online that supports yours assessment of DC being unusually dense.

And even if it is, that just makes a stronger case for the need of better public transport services.

> Many places in the US have these and both DC and the suburbs around it are full of them.

I’m sure they are but having a park and ride scheme is only of benefit if you invest in public transport, which, by your own admission, DC doesn’t.

Personal economies are literally built on the idea of driving, it will be painful to solve that, but unfortunately it’s necessary to solve it otherwise you end up losing enormous amounts of your life to traffic and the infrastructure cost grows exponentially.

There's an old cliche that goes something like, "In America, people think 100 years is a long time. In Europe, people think 100 kilometers is a long distance." It's pretty much spot on.

To all those thinking about is as 'policy' - you have to solve ways for making the subjective experience actually better if people are going to go for it.

Read a book.

Depends a lot on where you live and work. My experience was the exact opposite in Chicago. Heck, for some of my jobs I could outrun car commuters on my bike pretty trivially.

One of the clear downsides to transit oriented cities is that you do need to pay attention to transit access when renting. A unit being “luxury” is no guarantee that it’s in a convenient place for transit, nor that the trip will be short.

> Yes I can redeem a lot of that time with my above average personal mobile computing set up

I find the need to make commute time productive quite an odd but common impulse. How about just making your commute suck less? Reading a book is better than driving in traffic.

> I couldn't get rid of the car entirely because I still needed it to move bulky things that I really can't take on transit.

Again, experience varies. For a lot of people it would be cheaper to abandon the car and pay for deliveries when necessary.

Regardless, do not let the perfect be the enemy of the good. If you relegate your car trips to just when you need bulk goods, that is far more efficient than the current habit of using a car fo every single trip.

> Most wealthy people (many of my friends) start families and people who can afford it buy detached housing for that. You're not going to be taking transit to these places.

We could, but we’ve built our infrastructure with the opposite assumption in mind. Most other rich countries use a mix of regional rail, bus, and cars to solve this problem. The issue of “mass transit doesn’t go to the burbs, therefore I must use a car everywhere for everything” is an entirely self inflicted wound.

> Bringing me to the fact that I've been accosted multiple times on transit by people who were high, drunk, or just belligerent

Maybe we could solve that problem instead? Because that seems like a rather silly rationale for designing a transit system around.

Also, it’s not like all car drivers are sober. In fact, a drunk driver is almost certainly a far bigger risk to your safety than a belligerent drunk on the train.

> I'm a huge fan of transit but pretending it isn't a large sacrifice to give up a car is just going to get people to ignore you, because it is and for most people it isn't worth it.

It’s almost like I’m arguing that we should make public transit more convenient than using a car for urban transit or something.

I got a taxi from Gare du Nord to a hotel on Champs Eleyse this evening -- took about 40 minutes to go 2 miles. That's ridiculous, but it's apparently a thing.

Obviously a bus would be a better choice, or a train depending on geography. They handle baggage just fine.

1. It takes a lot longer to get to your destination even accounting for traffic.

2. The potential for harassment based on your gender or race.

3. The potential for sexual assault.

4. The potential for violence.

Unfortunately, Western society at large is not collective and conformist like the one in Japan, which would heavily mitigate 2 out of the 4 problems stated above. Even then, Japan has a huge problem with harassment and sexual assault when it comes to female passengers.

The reason is that these are all post-war constructions. London and Paris (I don't know Seoul) already had dense, walkable cores that predate not just the modern highway, but even the automobile. Inner London was 5 million people in 1911, and the rise of the car drove that population down! And things didn't really get going until the highway boom. The interstate system (and similar projects in Canada) didn't start until the 50s, and didn't finish until the 80s. So this whole project is fairly recent. Highways enabled a whole new kind of development - the suburban project. And now the boom is over, and it's time for the hangover.

And you'll note that it hasn't been all at the same time. LA famously hit these limits in the 80s. While Atlanta only hit them in the last couple of decades. What you're seeing is the end of a long process.

There's also only been one subway line opened this century.

We seemed to do better at facilitating growth last century, particular in the first half. Since then we've struggled, mostly for political reasons.

Given the right infrastructure, we can probably scale cities up to incredible populations.

Instead, we stopped building that infrastructure, and everyone started commuting by car. Then we wonder why cities are struggling to expand and usefully located housing has become so expensive.

We're trying to watch 4K YouTube over 28.8k dialup, and wondering why it's buffering all the time.

Toronto has a laughable subway / train network given the urban sprawl and distance that people are commuting.

If I pay to take one of the most expensive toll highways in the world I can get from my home to the office in just under an hour.

Isn't this a good thing in some ways or maybe many/all ways? Now wealth is less concentrated in one or a few locations. Every dollar not spent commuting is a dollar spent at a local coffee shop, or money that goes into the tax base of the other city.

So while you'd be spending a larger percentage of your money locally, you'd also be spending less money in absolute terms.

While I think there's a lot that Canada (and other democracies) can do to help reduce housing prices, it's almost like a truism that if you have a great city with a lot of high paying jobs, getting closer to the city and getting access to that city will be expensive. I mean, if we were to take what you were saying to heart, why doesn't all of Canada move to one city? Clearly there are some bounds.

> So while you'd be spending a larger percentage of your money locally, you'd also be spending less money in absolute terms.

True, but in absolute terms it's cheaper to live where you're spending the money as well, which pays for a house, etc.

Truly "cheap" housing is historically limited to rural areas far outside the traditional commuting area of the big cities, but the covid shock has put even that in question through remote work. Even though a small number of people in absolute terms are moving to rural areas (with sufficient Internet infrastructure, etc), that still can represent a large relative demand increase.

Some of this will probably shake out over the next few years as construction catches up where it can, but that's cold comfort to younger families on the market today.

It’s interest rates!

Go and look how many of these homes are on AirBNB and summer short term rentals every year and then sit empty the rest of the time.

If you want a house and a job in this country, you have to go to Alberta, Saskatchewan, or Manitoba. BC has no land and is either mountain or agricultural land reserve (the second-largest city in the province has massive fields in the middle of it; average single family home price $1M). ON and QC are similarly boxed in for land (the Canadian Shield is very difficult to build on, and if you don't know French the only part of Quebec you can really go to is the Montreal area), and the Maritime provinces have land but no work.

The important thing to remember is that, unlike the US, the vast majority of Canadian land is much more difficult to inhabit- 90% of the population lives within 100 miles of the border, because that's where the good land ends.

You can go to BC and see massive valleys of farmland (maybe used for grazing) that could easily be built on.

90% of Canadians live within 100 miles of the US border because: 1) the weather is better and 2) transportation options 150 years ago drove settlement (transCanadian railway and access to waterways) and 3) development begets more development, so established communities tend to grow rather than new one sprouting up.

The area in the red is one continuous granite slab called the Canadian Shield. The US has no comparable geography.

There's almost zero topsoil, and building any community there involves a lot of very expensive blasting. It's bad land for the opposite reason that the Australian continent is largely uninhabitable: there's tons of water, but no soil.

(The only real upside to it is that it's very conducive to hydroelectric energy; the vast majority of Canadian energy production can be, and has always been, zero-emissions- we call electric companies "the hydro", and combined with the nuclear reactors in Ontario, 85% of national electrical power generation is zero-emissions.)

Superimpose a population density map on the Eastern provinces, and you'll notice that generally speaking, the settled area of the provinces ends where the shield begins. That isn't a coincidence.

Sure, climate change should make a bit of the [non-red-shaded] land more economically useful, but that's about it, and mining/farming communities generally aren't large enough to provide a base for a new city especially because it's landlocked- so you're not going to see any new cities spring up there any time soon.

I think you're just ascribing cause when in fact northern Alberta is just as empty but has no Canadian Shield.

I was going to say, there is still a lot of land both outside and inside the “Shield”.

You would think that wouldn't be too hard, but housing construction in Canada has been seriously lagging even at a countrywide level[1] with housing units per capita continuing to trend downward. And then of course it doesn't help if major metros see population growth rates faster than this.

[1] https://dailyhive.com/vancouver/canada-new-housing-populatio...

Parent post’s point is that there are many levers that can be pulled to alleviate the problem, but that zero of the options are being acted on.

Maybe it’s trivial to stack wood together, but apparently you can’t “easily build your way past” given the political climate.

The houses are being built across the country, immigration tends to drive people to 3 main cities in the country.

The 3 main cities have a hard time expanding and building due to zoning laws, NIMBY, and basic infrastructure (transit, roads, education, health).

Perhaps you and I should get together and we can explain to a group of detached-house-owning baby-boomers/empty-nesters why liberalizing or eliminating zoning laws would lead to optimal land utility and that they should be ok with allowing row-houses in their neighborhood. And that would be an interesting conversation.

Of course some millennials will enjoy a windfall when mom and dad eventually downsize. Not all, by any means - but some.

I hope you're lucky enough to have some house-rich parents! It's always good to be an aristocrat!

Without holidays, iphones, food delivery, cafe coffees, gap year, 'finding myself', international travel etc.

That generation (of which I'm not part, but have taken the time to hear the stories of) lived week to week scraping by on bare subsistence living so they could pay the mortgage, with interest rates of 7-18%.

So they strove and sacrificed for the defining decades of their life for that equity, and of course they want to keep what they worked and sacrificed so hard for.

Plus there are a few stories of rich int'l students eventually becoming PR holder and get their monies from parents.

Likewise if you dont know who you're bidding against, how do you even know the bidder is even real (foreign or not)? Transparency is good thing.

While there may be some "scarcity" not having full transparency and realtors not in alignment with their own clients needs is a step in the right direction.

(I use scare quotes here because while I know we're not building enough but the current market has a fair share of retail speculation, institutional investors inflating prices, and homes held as purely places to mark money(non-owner occupied). Scarcity is real and building does need to happen, but thats slow and expensive. Millions of homes are kept empty or as poor speculative investments and thats a problem)

Of course not, and I didn't say that I'm completely against reforming the real estate industry and the bidding process. But it won't fix expensive housing.

It's all bullsh*t if it doesn't address scarcity. In 2016 we had had 10 years of 2% population growth in Vancouver and 1.2% housing stock growth and we wanted to blame foreign investors, so we enacted the foreign-buyers tax. That was going to fix high housing prices.

In 2017 we all got angry about dirty money and our casinos being used as money-laundromats so we commissioned the German report to detail what was going on and surely that would show that real estate was expensive because of money-laundering. It said prices might have gone up by 6% because of money-laundering. So that's 6% of 400%.

In 2021 we started talking about investors driving up the cost of housing, ignoring the fact that investors typically become landlords and in cities with rental vacancy rates hovering around 1% (Vancouver's was 0.4% in 2017!!!), that sounds like a good thing.

It's all bullsh*t and it's all a distraction that let's us ignore scarcity. I've decided that no matter how justified that housing reform is (ie open-bidding), I refuse to support it before we deal with scarcity because we'll deal with open-bidding and then say, "Ok ... let's see where we are in 3 years time now that we've fixed that!"

Deal with scarcity or f*ck off with talk about housing prices. Don't expect me to validate your cognitive dissonance.

I can't do it because it's illegal, that's why. And I would have to go to city council to have them change the law (rezone the land). And the neighbors will campaign against me and argue against density. I own the land - I paid good money for it and it's mine in every sense of the word, but the neighbors will argue that their preferences and whims outweigh both my property rights and the rights of other Canadians to have a home.

But even if it were, it wouldn't solve the real problem in these north american cities, which is the "missing middle".

The model of small area of highly dense towers aimed at 20-something urbanites with no kids surrounded by spaced out single family homes with a yard is just fundamentally unworkable at any real scale.

If Vancouver wants to solve it's problem and not become a suburban/exurban sprawl (typical failure mode these days in north american growth) it's going to have to build a whole bunch of mid density housing near to downtown, and it's mostly going to have to build that on top of areas that are currently full of single family detached. This is not going to make current denizens of those "nice neighbourhoods" happy, naturally.

Once you leave the penninsula, though, it's surrounded by a lot of suburban sprawl, with small pockets of density around the SkyTrain stations. Unlike most North American cities, though, at least it has those pockets of density!

If I understand "the pennisula" correctly, you are referring to something like 1/10th of the city proper (not the greater area, just the city of Vanc.). It is mostly zoned appropriately; outside of that it's a mess.

Everything in grey and yellow is part of the problem mentioned above.

They're not happy with megatowers. They're ok with missing middle (townhouses).

There is a whole stretch of roads being bought out and converted to missing middle that leads to downtown. (Oak, Cambie).

Is it the case there that people are ok/happy with mid rise places along busy corridors only , but want to maintain SFD on all the side streets? That really doesn’t work either , it’s just people making a noise etc. barrier on “their” neighborhood…

> I’ve seen zoning fights about even duplexes, let alone anything bigger - not sure if Vancouver is more accepting of that than other places .

Nobody has any issues with duplexes and townhouses.

It's a bunch of patch up jobs really.

I do agree that they should just bulldoze and start developing around Skytrain stations first. That way they have a starting point to sprawl a bit. It should be a give and take from both sides: govt and nimby. Govt needs to give nimby something to keep them happy (sad but what can you do) while telling them to F off when it comes to building towers around skytrain (first).

This outside competition detaches local prices from the local economy. Likewise the speculation sets an anchor(comp) for neighboring homes when they go to sell. One investor overpaying by say 100K.. well now next month if Average Joe wants to sell he can now ask the same or more. Rinse and repeat just a few times and you get to where we are today.

<sigh>

As long as we have folks buying with the intention of parking money or using homes as an "investment" you're going to have competition with much deeper pockets

Why do you think foreign investors want to overpay for a Vancouver Special? And what do they do with it once they buy it?

Do they live in it? If so, what you're upset about is population growth. Sounds like scarcity!

Do they rent it out? If so, that's a social good in a city with a 1% rental vacancy rate and sky-high rents are as bad as high housing prices. Sacrificing the rental market to save home-buyers sounds like scarcity!

Do those foreign investors leave the house empty? Who cares if we can just build more? And we know (https://doodles.mountainmath.ca/blog/2022/02/14/unoccupied-c...) that Vancouver doesn't seem to have more empty homes than most cities it's size. But of course we can't "just build more". Scarcity!

The truth is that we've seen developers market condo pre-sales in China playing-up the region's dysfunctions - pointing out our 2% population growth rate and the difficulty in building new housing. Investors come to Vancouver because they know the game is rigged - they know that housing prices are mostly one-sided and hedged by political interference. Canada's real estate is "too-big-to-fail" and is mostly up-side.

Don't talk to me about housing prices unless you deal with scarcity.

I'll note here that there is a legitimate complaint to vacant housing. Some expensive city infrastructure like transit is supported by people-density rather than house-density, so a community of empty homes doesn't justify a subway line in the way that a bustling, lived-in community would.

Municipal funding that comes from the provincial level is also supported implicitly by income and sales (value-added) taxes rather than property taxes, so empty homes can easily create an imbalance of cost and revenue. The same also goes for cases of alleged tax evasion, where one globe-trotting patriarch supports their live-in family without declaring and paying Canadian taxes on income as a resident.

I used to live in Yaletown (Vancouver) and the building I lived in was this very tall, maybe 35 story two tower block which only had two elevators. It took me about 6 months to realize that I never saw anybody else in the building. There were only 3 occupied apartments on my floor (I think there were 8 units per floor). I was told the building was designed to be a "piggy bank in the sky" and that low occupancy was in the design.

This is just an anecdote, but I was under the impression low occupancy is an issue in Vancouver so much so that they tried to pass laws regarding empty homes.

you've literally just responded to a post demonstrating that this is not the case, please don't just do template rants off keywords

The only loss when building more dense housing in urban areas is the existing owners whose views are blocked. Otherwise it seems to generally increase the tax base, support more businesses (when mixed-use housing is built), and increase renter mobility.

It is a lot about more supply (and less price increase, or even decrease). Not about views being blocked. People who own homes feel the need to defend the price of their prized asset, for which they have used their life savings plus leverage. The system is designed to perpetuate itsself

That is not an accurate summary. Earlier...

Either we limit Canada's crazy-high immigration rate (1% of population every year) or we build more homes which is mostly gated by illiberal zoning laws passed by municipalities. But both of these policies are very popular so you'll be swimming upstream, politically

I completely agree with you - housing prices are high, mechanically, because of scarcity. But scarcity exists because voters like high housing prices. The truth is that most Canadians own property and are perfectly happy with their $1-3 million in equity. And regardless of their stated preferences for affordable housing, the revealed preference for scarcity and expensive housing is clear.

All I want is to shut down people looking for someone to validate their cognitive dissonance.

I mean, I think hanging 30% of your population out to dry is a bad idea, but I can't argue that this isn't a tyranny of the majority situation (or maybe tyranny of those in power, of which I expect closer to 100% are property owners).

So you, the realtor, will sell every house you got anyway, so why not bump the price while you're at it?

Can all affect what you would select, not just the price.

Its a poor sales person that thinks, "I might not sell one this month..." Not with that attitude.

You could just stop there, it’s clear where your priorities lie. I’m not Canadian (and don’t worry I’m not emigrating), but I welcome a “crazy high” 1% population immigration rate and I don’t see a conflict with that and reasonable housing policy. Many major cities already see this kind of growth regardless of where people are moving from. We should be able to house and sustain that growth.

Limits on immigration don’t slow the growth, they just satisfy anti immigration attitudes for a while.

This is such a toxic take - listen I know there are xenophobic people out there, but just because someone brings up the fact that our immigration is high doesn't make them one.

Canada builds on average something like 189K houses a year, our current immigration targets are 400-450K ppl per year. We have the LOWEST housing stock in the G8 while having one of the largest immigration numbers, plus due to the selection / scoring methods for our immigration policy they are often entering the country with a sizable nest egg which allows them to enter the housing market sooner.

Add on top of all this that Canada has a blatantly broken provincial nomination process which allows people to get perm residency faster if they have a province nominate them - it was intended to get people to put down roots in those provinces, instead people use it to fast track PR status and then immediately move to Toronto, Vancouver or Montreal. This again stresses an already saturated market and infrastructure.

Canada needs immigration - there is zero doubt about it - however the rate needs to be lock step with the infrastructure and housing needs that population boost brings with it.

Canada needs to:

1. Slow immigration by roughly 1/3 for a period of 3-5 years. 2. Massively increase housing stock during that period, possibly shifting some of the entrance requirements for people in #1 from white collar workers to trades to help with this. 3. Close the provincially nominated loop holes, either do away with the system and not allow fast tracks or require that if you fast track you need to stay in the province until you become a full citizen - moving revokes your PR status. 4. In Canada's smaller cities start doing deed restrictions like Colorado did with Vails Indeed program, this will help with smaller towns / cities having their native population priced out by people fleeing the larger cities.

None of those takes are xenophobic or anti-immigration. A person can be pro immigration but be against the current policies that surround it. You muddy the water and come off as dishonest and toxic when you automatically assume malice.

One of the problems is that once people buy into the system, their entire life's savings (plus often 4x more via leverage) is tied up in the house and the price of the house. At that point, most dont want more development, because they lose their life savings if home prices go down.

Each person entering this horrible system is forced to perpetuate it, or lose it all.

If the country can't figure out how to deal with a population growth of ~1%/year, the problem is not the growth, the problem is somewhere else.

And yet here we are.

Folks love their suburbs. And they love those laws protecting their suburbs and excluding everything else the market might want to try.

2. Of course you shouldn't count foreign students or temporary workers, they get counted if they choose to stay. If you were counting them, as well as immigrants, you'd be double-counting the same people.

3. I didn't realize that the singular suburb of Vancouver called Richmond, BC (Population: 216,000) can be referred to as 'several cities'.

4. Why does a young[1], educated[2] person moving into the country in the prime of their life 'put an enormous strain on everything'? Would you care to elaborate? To me, it seems like a gift of all the costs of early-life childcare, plus the cost of a K-12-post-secondary education from their country of origin.

[1] https://www.statista.com/statistics/443305/international-mig...

[2] https://www.statista.com/statistics/555224/number-of-landed-...

... Or build more.

In the last year, we've ended up #2 in 6 bidding wars (as disclosed by the listing agents) in one particular area of the GTA. In each case we reached our absolute max and wouldn't have paid any more.

Several times we lost by $100-200k, and once by $250k. These overpayments set new price benchmarks for the area which became sticky. To continue to be competitive, we had to make hard sacrifices to increase our budget throughout the year.

The fact that houses continued to move at the prices determined by these over-payments indicates there are some buyers at the higher prices. However, the market is very thin and the pace of price growth in this speculative market would've been slowed with open bidding.

Beyond the blind bidding issue, I don't know why people focus on foreign and large corporate buyers. Yes, they're scary because they represent potentially large sources of demand. But are they actually buying a large percentage of the homes? No. It's the smaller investors who speculatively bought 40% of homes last fall.

But we should definitely protect mom and pop investors, such as our housing minister wink

Real solution? Reduce the incentive for speculation among these groups by treating all gains on non-primary residences as income.

Not to mention the ridiculous commission fees for realtors, and their well-known practice of "steering" people away from homes with lower commission or prices. A practice that is technically illegal, but not enforced.

But because real estate agents are middlemen in the process, there's an incentive in a hot market to not act as an honest broker.

When the market isn't "hot", a realtor has an interest to move quickly. When the market is hot, they have incentive to move their own listings so they get both sides of the commission. In my case circa 2005, I bid $50k over list via the broker who was managing my home sale. The selling broker "lost" the bid somehow and sold it for $20k over listing price.

7% of 20,000 is close to 3% of 50,000. But... I came to learn later that the selling agent targeted a particular religious community hard, and did a hard sell on insurance, inspection, and even attorneys to buyers, and frequently yielded another 3-5% based on "spiffs" from those providers.

All of these inefficiencies and bad behavior add up and inflate prices.

Though I will point out that in most of the jurisdictions in the link provided, there's nothing that prevents your scenario - a third party offer is turned down due to the dual agency bid being favored by the sellers because they never received your bid. Only in Colorado, Florida or Kansas is it explicitly prohibited. But at least if it was in one of the other states that requires disclosure (Alaska, Maryland, Texas, Vermont, Wyoming) the sellers would have at least been aware of a possible conflict of interest and may not have entered into a contract because of it.

Of course the reality is that there is very little governing their conduct and behavior. Without a functional "exchange" or disclosure rules, both buyer and seller are dependent on good faith.

Where there is money and little oversight there is bound to be fraud. It grinds my gears to think about this because I bought a house and the escalation clause went to the maximum. Now do you think that was purely coincidence?

Eg. my realtor called up the selling realtor and asked for the name of the realtor that submitted a competing offer. My realtor called the competing realtor to confirm they had a client that submitted an offer.

Yes, of course the two other realtors could conspire together. But, now instead of one dodgy realtor you have 2 and the probabilities go down further.

Is there fraud, I'm sure there is. But, I don't think it's a significant factor in the market.

In such a case, I’d predict a lot of partnerships (or whatever the lowest cost legal structure that isn’t traceable over time if not activated) would be bidding for houses. My bid as “123 Main St Partners” can be as public as you want I suppose.

Almost everything mentioned in the various comments here is a scapegoat. These all might contribute a little to the escalating prices at the margins, but they are not the root cause.

The root cause is that many capitalist societies have decided that purchasing a house is the most expensive and important investment most people will make in their lifetime. Therefore these societies gradually shape their policies to ensuring these investments continue to increase or else there are widespread repercussions. The end result is we have collectively refused to build enough housing to keep prices stable or decreasing. The prices need to go up. I don't understand why no one is willing to admit this.

All the other problems originate from this. The reason foreigners want to buy homes as speculation or a place to park their money is because governments are committed to ensuring that housing is a safe and profitable investment. It all comes back to us deciding that a basic human need should also be an investment that always is increasing in value.

We don't want prices to go down so we don't build enough supply. The policies that make housing a good investment increase demand from speculators and investors above the natural need for housing. There are all sorts of subsidies that exist to give people more money to buy housing instead of trying to make housing actually cheaper. Interest rates are a lever the government uses to support its political goals which includes increasing housing values. It all comes back to the same root cause.

If it’s feasible and profitable to build new homes, then developers will do so.

Everyone loves the simple solution of “build more houses”. Very few actually consider the execution of the master plan. What would it take for you to start building homes? It’s an enormous risk, requires tons of upfront capital, specialized labor and supplies.

When everyone wants to live in the same areas, housing prices go up. Lifting zoning restrictions isn’t some magic bullet that will alleviate that fact.

No, but real estate companies wouldn't be able to lower property taxes alone. It's only happening once there is a critical mass of homeowners that is voting themselves a tax cut. Large real estate companies get exactly the same tax cut and since they have more property they benefit more than the average homeowner. One could have a tax cut for owner occupied housing but no, there is no limit to the tax cut. Everyone including billionaires gets it. That's incredibly unfair.

High property taxes hurt renters too. Rent prices increase to cover the difference.

Homeowners don't need to orchestrate and elaborate scheme, they just vote for the politicians who will prioritize increasing home values because that will help them financially. That politician will enact policies favorable to homeowners because that is what their constituency wants. That will encourage more people to become homeowners because people see homeownership as a financially beneficial endeavor. That will increase the power of homeowners as a constituency which will lead to more politicians courting homeowners with favorable policies making homeownership more attractive. And on and on the cycle goes until it isn't "feasible and profitable to build new homes" because we have made it difficult and expensive through all our pro-homeowner policies.

Or y'know...maybe homeowners don't want to have their neighborhood become overcrowded. Not everyone wants to live in a megacity with traffic, air pollution, constant bustle, and restricted personal liberty.

If financial gain is your only motive as a homeowner, you would actually WANT an increase in density. As you cram more people into a smaller space, the land underneath becomes more valuable. Increased density attracts amenities, restaurants, businesses, nightlife...etc, all of which raise the value of your property.

Homeowners care about things other than net worth.

Then it’s time to collect your scarcity-generated windfall and move someplace rural you’ll like better! Super-common, and you can even complain self-righteously about the terribly governed crime-ridden hellhole you’re leaving behind.

I am quoting my original comment because it seems like you didn't read it:

> Not everyone wants to live in a megacity with traffic, air pollution, constant bustle, and restricted personal liberty.

> If financial gain is your only motive as a homeowner, you would actually WANT an increase in density. As you cram more people into a smaller space, the land underneath becomes more valuable. Increased density attracts amenities, restaurants, businesses, nightlife...etc, all of which raise the value of your property.

Do you have an actual response? Or do you just need to be outraged at something?

Nothing I said here is specific to neighborhoods. It also applies at the city, state/province, and national level. A homeowner in San Diego likely doesn't care about the density of various neighborhood in San Francisco. But they might still vote for Prop 13 which put harsh limitations on property taxes in the state and in turn increased the value of homeownership and the cost of housing. That decision has nothing to do with personal preferences of what type of neighborhood in which people want to live. It is purely homeowners being powerful enough to vote themselves tax breaks which makes homeownership more attractive which makes homeowners more powerful...

This is just one piece of the puzzle, and frankly its a bit much to chalk it all up to power/greed. Again, if CA homeowners make up the majority of voters what exactly is the alternative?

If I'm being honest, my opinion on CA housing markets means nothing...but it seems pretty sensible to me that when a shitload of people all want to live in a handful of cities, prices HAVE TO increase. Removing prop 13 and zoning restrictions isn't going to double the housing supply.

On a semi-related note, pretty much everything in CA is more expensive. The residents there vote for expensive public services and legislation. When everything is more expensive, you bet your sweet ass houses will be as well.

There's also no incentive to build affordable or well-constructed homes. Many builders will try to maximize profit by investing the bare minimum (i.e., cutting corners) and creating the largest number of dwellings possible. Mattamy Homes is infamous for developing large neighborhoods with pretty homes that practically fall apart in a matter of months if you look at them wrong.

This is sort of my point. Who's going to build the "affordable housing"? Why won't the affordable housing get snatched up by the highest bidder?

The federal government already spends way more than it can afford. State/local governments don't have anywhere near enough tax revenue. It would require a multi-trillion dollar operation to increase supply enough to offset shortages.

> The end result is we have collectively refused to build enough housing to keep prices stable or decreasing

This is not the result of a hushed down societal decision. The refusal to allow housing construction the cause of the ever increasing prices. As so often, it comes down to basic microeconomics: If you limit supply while demand rises, prices will constantly go up.

I do agree that foreigners, like anyone else, buy homes as speculation because they're guaranteed to increase in value.

And what would you say is the cause for that? I would generally say it is people trying to protect their existing investments in housing.

It sounds crazy today, but the vastly poorer US society of 1960 supplied pretty everyone with an indoor place to sleep and call home.

I'm American so I can't speak to the specifics of what happened in Canada, but I imagine it is similar to what happened in the US.

It is all related to the post-war suburbanization of the population. In the early part of the 20th century, homeownership rates in the US were in the 40% range. By the 70s it jumped to roughly 65%. Large swaths of the population went from being lifelong renters in cities to buying single family homes in the suburbs. Owning a home became a symbol of American middle-class life and the government both supported and encouraged this transition. Obviously a constituency that makes up 65% of the population is going to see more political power than one that only makes up 45% of the population.

  1960:
    Pop: 3,034,949,748
    %Urban:  34%

  2020
    Pop: 7,794,798,739
    % Urban: 56%

I think it was more a case of upgrading to modern sanitation standards etc.

That said, I have no real detailed knowledge, and would be happy to learn how wrong I am about this :)

The insanity of "we can't let you have a bad X, so you get no X!" is one of my least favorite things in this era...

On the other hand, flop houses aren’t economical to run anymore, and the drug problems (especially with decriminalization) have gotten much worse. It’s not clear they can work like they did in the past.

No, rather somebody at the top needs to go down.

That aside, this is absolutely correct. It's constantly irritating to hear politicians praise "strong housing markets" when "strong" means "unaffordable if you're not already wealthy".

You mean opposite of a free market. Property rights, aka the exclusion of other people, is actually an inherent part of capitalism. When you think about it, capitalism isn't actually about physical capital. It's actually about having the rights to be allowed to do things and restricting other people's rights while boosting your own rights is considered perfectly okay under the guise of private property.

When you think about it. We have built a system that tells you whether you get to work or not. This is completely independent of your ability to work or gain skills. It's like a brain cage that tells people they are powerless when they really aren't, they just aren't allowed to help themselves.

A lot of laws that set a minimum living standard basically make it illegal to live. If you are going to demand that everyone must meet that bar, then you must actually do something to let them achieve it. Instead, we just abandon people under the guise of personal responsibility.

can you give an example of this? I don't believe the current system prevents anyone from working if they have the skill. The closest policy to what you described is segregation and racism, but i don't think that is what you're referring to.

> A lot of laws that set a minimum living standard

there's no such law. There's minimum wage law, which might cause unintended consequences, if the minimum is inappropriate. But so far, the current minimums don't seem that inappropriate.

Steering is a problem.

In a competitive market, filled with buyers of questionable sophistication, i.e. residential real estate, everyone gets to the bottom of maximally-waived, minimal-safeguards pretty quickly to make a competitive offer. And ultimately, that isn't good for anyone, sellers included.

Better to explicitly prohibit the stupidest behavior and require some safeguards. E.g. non-waivable 72 hour cooling off period. Then everyone can compete within those bounds however they want.

Peace-of-mind is worth a lot. Especially if the buyer is sophisticated, I might take a lower offer if it has the right waivers.

Is it though? I chatted with someone from Australia which has open bidding and you know what .. houses still went way over reserve. At the end of the day, if you have 20+ offers on a house, you're not getting that house without destroying your budget, no matter how you set up the bid system.

The common sense change I wanted to see implemented was to prevent the waiving of a home inspection as a condition of purchase.

I also want to see mandatory home inspection, seems common sense.

It's a very manipulated and manipulable metric.

It's not. The salient part is that the current market is crazy and there is a large number of bids on any given house.

>It's clear that in a lot of cases the list prices are intentionally below market to attract more bidders and produce the appearance of more competition at open houses and the like.

Yes, list prices are intentionally below market but you know what ... houses are going for crazy amounts because we are in some sort of a bubble. This isn't the fault of blind bidding, or unscrupulous realtors or greed property owners. There are systemic economic issues at play. In my area, for example, there are houses that doubled in value in under 24 months. When I bought my property 12 years ago, there was blind bidding, and bad realtors, but on any given property there were only 2-3 bids, so there was no issue.

Why? The last 40 years interest rates have continued to decline and inflationary pressures have hurt the value of every currency. What reason is there to believe this won't continue indefinitely (low interest + ~2% y/y inflation) and that the market is simply pricing things well?

Clearly all these homes are being bought so it would appear people have the money.

Yes ... Back in 2007, people bought homes as well - so everything was OK - rite?

By the way, people aren't paying cash for houses.

Homes are priced based on what people who want to live in a place are willing to pay per month. The interest rate, property tax rate, and home price determine that. As rates go down prices go up.

That was a response to your statement that 'people have the money'. The larger point is that just because people are buying houses doesn't mean that things are healthy, case in point: 2007/2008 housing crash, which was preceded by a housing bubble and led to a lot of misery.

Corporations and pensions might have the proper money

Just bring your inspector along to a showing or open house, etc. Owners won’t even be there.

What you're suggesting is called a "walk-and-talk" inspection, and is not going to find the high dollar problems a traditional inspection can find.

I have done all of those things on home viewings / open houses. I've opened septic risers, started generators, tripped breakers ...

Nervous smiles were the worst responses I've ever gotten.

You, and your sibling poster, are correct though: a real, comprehensive inspection is hours long and no amount of brashness is going to bridge that gap - but there is a LOT you can do with 30 minutes of knowledgeable poking and prying. You don't need an hour to see if the sills are rotting or if there are no foundation anchors ... or if all the floor joists are swiss-cheesed up by 40 years of ad-hoc electrical and plumbing runs ...

But yes, you can probably inspect the construction quality and foundation pretty easily, a visual inspection of the roof and siding, and if you care the quality and age of utility appliances. You can also pull the permits if you're really interested before placing a bid. You can probably scan for termite damage, etc.

A decent inspection is a 4 hour job or longer generally in my experience.

It baffles me how this industry has not yet been disrupted by an outsider, like Uber did with taxis. I still remember when taxi licenses costed a fortune, and you had the exact same leeches exploiting it. They were seen as an investment in some cities, like NYC.

I know there are useless regulations that keep these agents being needed, but so there were with taxis as well, and Uber did not give a crap.

In the case of Uber, supply (people who own vehicles) was effectively unlimited and independent.

The difference, with Uber, of course, is their cost of capital was relatively low. They didn't have to buy vehicles, for example. (Imagine having to tear down a few multi-billion dollar real estate developments. Yikes.)

Real Estate isn't a regulatory trap; it's an information trap. You can buy and sell property direct. All of the legal stuff is (nominally) done by attorneys. But the association of realtors controls the listing service and makes discovery easy.

Like all salespeople, realtors add "value". When you've been in 2,000 houses, you pick up insights that are useful and learn about neighborhoods. The information is used for both good and bad purposes.

Most of the disruptors do stupid shit with stupid investor money or integrate with the existing players and add some value.

Since 1973. https://en.m.wikipedia.org/wiki/RE/MAX

No -- you're confusing real estate sales with real estate. Real estate is one of the most highly regulated industries out there. You literally can't make any significant changes to most properties without a significant permitting process that goes through many layers of regulations. Not to mention the many real estate developments that are never even a possibility because of regulation. I'm not against regulation -- it can be a very good thing -- but it is clearly at the core of the real estate problem. Society has decided, via regulations, to starve the supply of housing.

While they did disrupt the taxi market, they are also setting false expectations about what sort of model is viable in the space since _Eventually_ they will need to bring in revenue or could potentially be forced to pay their drivers more which would lead to a big hike in prices and would probably have an impact on how it functions now.

Why sellers want to pay tens of thousands in commission in a bidding war environment is a mystery to me.

We're currently hunting for houses, and lost out on a few listings because we didn't want to overbid. When the sold price was revealed, SO many times we'd think DAMN, we'd prob pay $10-$25K on top of that to get it had we known..

Blinds bids prevent bidding wars. They use them in Scotland. Not sure if buyer or seller is better off using them.

I don’t see how a blind system can take those factors into account to algorithmically select a single winning bid.

Often the best bid is obvious - for example an unconditional offer at the highest bid. Sometimes the best bid is not so obvious, and the vendor chooses the bid that suits their situation the best, or they renegotiate price or conditions with the highest bidding buyer(s).

A vendor that doesn’t really need to sell and that believes prices are still rising, might accept a high price with a long settling date, or other conditions that might cause the sale to fall through.

A vendor than desperately needs the money might accept a lower price with immediate settlement, or if they know their house has problems they will accept a lower bid if it reduces their future liabilities (e.g. zero inspection, as-is clauses, etcetera).

There's a theorem an auction design that says that, under some vaguely reasonable assumptions about bidder information, it doesn't matter what form you use for the auction. Open auction, sealed auction, even second price auction should all give the same winner and same final price: https://en.wikipedia.org/wiki/Vickrey_auction#:~:text=Revenu...

It doesn't work with open bidding, because then you could bid artificially much as long as the 2nd highest bid was at your real valuation or below.

(Or https://en.wikipedia.org/wiki/Revenue_equivalence)

But yes my intuition when selling my house was "surely I'd get more if this was open bids"

Though psychology comes into play in a bidding war, at least it's happening because the asset for sale is highly desired. It's efficient.

And BTW I also bought a house before (no wonder, since I am not that handy, to sell a house I had to buy it first ;) - and if you hire RE agent, which at least in the US most people do, and they are worth anything, they'd get you at least the rough information on how high you should go, and sometimes even the exact numbers. There were situations where we knew exactly how high the highest bid is, and more when we had decent idea if not exact figure. So it wasn't exactly blind.

Probably, less than people think. Sealed bid auctions do not increase revenue to the seller, according to auction theory.

https://en.wikipedia.org/wiki/Revenue_equivalence

> gives all of the information to one side (the sellers)

Well, not all the information; just what other people are bidding. But all that matters to the bidder is that that other bidders do not have access to more information.

The fact that someone's bid is higher than yours, is not caused by its temporary secrecy.

Auction theory has so many assumptions that it really can’t be applied to buying a home. The link above assumes the highest bidder knows[1] the highest price the underbidder would pay, which is extremely silly. Apart from the fact that if you know the highest price of another bidder, then the seller also probably knows your highest price, and the seller can just ask for the highest possible price, duhhhh!

Bidding (auction or blind) is used precisely because the prices are not known.

Personally I have been involved with enough home auctions and blind bids to know that there are huge information asymmetries or uncertainties. When you lack information, sometimes you need to make your best bid, and you might value a property a lot higher than the underbidder.

I would like to see more protection against lemon markets, but realistically I can’t think of a fair way to enforce that. Banks and insurance protect some people against doing stupid things.

[1] First price auction: “if each player bids such that they bid the expected value of second highest bid”

> The link above assumes the highest bidder knows the price of the underbidder, which is silly

The first price auction and second price auction types are understood to be sealed bid. The English auction is open: bidders can bid more than once and see other bids.

In the second price auction, the underbidder's price is revealed when the auction ends, not during the bidding; the highest bidder pays that price.

In my experience academic auction theory is almost irrelevant when buying a house. I do have a close friend who designs huge market trading systems, so I will talk to them and validate my opinion.

In practice, house transactions appear to be driven by irrational or ignorant participants (vendors, other bidders, agents, banks, insurance companies) and sometimes understanding those factors can give you a significant edge in the market. Also every house transaction has different context, risks and it’s own unique factors, so it is very difficult to make generalised rules.

Disclaimer: I know little about auction theory, and I have only spent a few years trying to understand one tiny property market, so my opinions are not that valuable.

Right; so wouldn't those be the causes of whatever (if anything) is wrong, rather than bids being sealed? Give some irrational bidders open bids and they will have a bidding war instead.

- Make home inspections an unwaivable right.

- Eliminate blind bidding

- Fully open MLS data

- Heavily regulate (specifically buyers') real estate agents to eliminate much of the corrupt practices.

If you want open bid/ask, there is always the stock/futures/options markets.

There are also tenders, which I don’t know much about.

And I have seen auctions where they set the reserve at a ridiculously high amount, and then negotiate with the highest bidder. A few years ago, one place I was underbidder at $280k (for something that I thought should go for about $250k), final bid was $290k, then vendor negotiated that bidder up to $350k! Another I was underbidder at $190k, final bidder was at $200k, then vendor negotiated them up to $250k.

The dirtiest trick that real estate agents do is to convince/pressure vendors to bring the date of sale forward. Sale goes through at a lower price, agent does less work and turns over their properties more quickly (which vastly enhances the agents yearly profits).

New Zealand restricted sales to foreign buyers in 2018, to prevent ballooning property prices for New Zealanders. Also rich foreigners buying large farms and prime coastal real estate was unpopular with most of the voting public?

Edit: when the real estate market was burning hot, lots of sales were deadline (blind). I think deadline sales mean that the winner often has bid their highest price (I certainly did for my home). In auctions you often pay just a little bit over the underbidder, even if your top dollar might have been potentially a lot higher. When selling you mostly care about that one person who really loves your place and that is willing to, and can afford to, pay well over market price for it. All other potential buyers are just wasting time.

I've just bought a house, and it's been interesting to see the selling method change as the market goes from hot to cold - Auction, Tender, Deadline, Buyer Enquires Over, Asking price.

We need to take speculation out of the marketplace.

I'd also like to see a ban on corporations purchasing private homes and significant tax increases on non principle residences.

The principal residence tax exemption is also a joke but I also understand it's political suicide to try and get rid of it and at this point, since so many people have their life savings tied up in real estate, you'd probably be causing more problems by removing it.

For real estate this means keeping the property ready to sell at any time. It is easier to exchange an empty apartment and even easier to exchange an empty plot than a rented out apartment.

The downsides of renting out, i.e. the inability of being able to quickly sell the property must be compensated and that compensation is part of your rent. If you cap rent, that compensation will be insufficient to "bait" the property owner into renting his property out. They would rather keep it liquid and wait for a better offer. To keep it simple, the owner has options, the renter doesn't, so the renter must go out of his way to attract the owner's attention by paying higher rent than if he had outright owned the property himself.

Eliminating the liquidity preference of land would require all land to be leased or a sufficiently high tax on owned land (so that waiting and doing nothing has opportunity costs).

For non-primary residences? Sounds pretty good to me!

It would have broad appeal, but not to the developers etc. that are buying 10K plates at fundraising dinners ...

> The principal residence tax exemption is also a joke

The problem is that without that exemption, you literally can't afford to move. The 6% "tax" for real estate fees are already painful if you are trying to move to a house of the same value in another city, but if 40-50% of your sale value was considered a capital gain ...

The real problem is people "moving into" rentals for 6 months and then declaring that their principle residence and selling the property. Once you start renting it should be forever be a business property.

Definitely true and thought it would go without saying haha

The rest of your post is totally fair and I can't really disagree.

[0] source: an accountant I know that wants to stay in good standing with the CRA :-)

"When you change your principal residence to an income producing property, such as a rental or business property, you can make an election not to be considered as having started to use your principal residence as a rental or business property. This means you do not have to report any capital gain when you change its use. "

https://www.canada.ca/en/revenue-agency/services/tax/individ...

The taxman never leaves money on the table.

This would actually solve the problem (the calls are coming from inside the house- foreign investment is merely a scapegoat), and as such it won't be done.

But any step forward is a win.

Thank your MP and ask them to solve the next problem: Canadian corporate ownership.

Every age group, including the youngest (18-25) have a higher rate of home ownership than 20 years ago.

The issue becomes people with existing outstanding mortgages. If we considerably reduce house values, would outstanding mortgages need to be reduced pro-rata? Who would 'eat' that cost? The government? The bank?

Canadian Real Estate is pretty clearly in bubble territory. Something can happen now or later, but it only gets worse with time.

Let's ignore the property itself, which is a depreciating asset which was built and can be improved through manual labor.

That land is going to stay the same no matter how much you pay. Paying more for the same plot of land doesn't make it better. You don't get a bigger plot or a plot of better quality by spending more on the land. The land isn't wealth, it's the community around the land that gives it value. If you have demographic problems, your land is going to be worthless because the community is too old and shrinking.

Betting on ever growing populations is a pyramid scheme by the way.

it has been a good bet in the past. Whether it remains a good bet is unknown - that's what makes it speculative. However, i don't see the population declining within the investment time period of a typical person buying the home.

Just in case, I do own the house.

1. It'd suck for me if house prices went substantially down.

2. It is nevertheless absolutely positively the right same thing for society.

The assumption that house is mandatory, can be your main retirement or even only plan, and prices can only go up is crazy and unsustainable. Pain is coming and I see no reason to keep making it worse while enriching people in undeserving ways.

This was my opinion for 20 years,from poor university student to renter to condo owner to house "owner". But I come from Europe so my brain can grok the notion of "you don't have to have a massive house. You just don't". This may sound insulting but my wife is love of my life, born Canadian, and cannot comprehend not having a house, having a family without a house, or that prices can go down. It's like seeing ultraviolet - no matter how much she squint she's not physically equipped :-)

If you purchased a home that someone who had less money wanted is that stolen property?

Can I have your computer, phone and your car. I don't have any money but you having something I want means you stole it.