GTA Housing — Rent Must be Part of the Solution From CIBC
This is the best analysis I have yet seen on our rising Toronto real estate prices. As I have stated on numerous occasions Toronto will naturally move to a higher rental rate than ownership rate. Currently Toronto housing is roughly 65% owner occupancy. This number will likely fall to 40% over the next 10 years as purchasing a home becomes impossible for more people. The investor tax being discussed by various levels of government really will not accomplish lowering prices beyond the initial shock period. I believe the CIBC report’s assumption that Vancouver buyers decided to wait and see, thus lowering the demand for housing over the short term. I am sure we will see a big spike in Vancouver prices shortly.
We need an increase in the housing supply immediately. This means the provincial government needs to build the infrastructure to enable growth in the areas in the 905 that are earmarked for growth. The City of Toronto Planning Department needs to speed up their processing of applications and stop stalling projects through policy and other tactics. We need them to relax density restrictions further and allow for higher buildings. We need a fully staffed OMB to deal with the inevitable disputes quickly. We clearly need investors to build thousands of purpose-built rentals. Our Ontario Housing Minister is talking about increasing rent controls on properties built after 1991. This just disincentives investors from moving forward on these projects. Clearly this gentleman does not understand our real estate problems, government needs to get on side with the industry to solve the issues we are facing. I am definitely not seeing this taking place.
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