Comments on: Canada’s Housing Supply Has Outpaced Household Formation For Two Decades: BMO

By: Jon

Jon — Mon, 25 Jul 2022 12:12:52 +0000

A well thought out and researched article. Another major contributing factor to increased prices has been the two largest generations (boomers and millennials) chasing the same assets believing they would never decrease. As baby boomer generation withdraws from housing and markets to support retirement, they will have to decline in value. Less dollars chasing more available product. Any governmental interventions will only serve to kick the can down the road and make it more painful when we are forced to reckon with the facts. Houses are this generation’s tulips.

By: Matt

Matt — Mon, 25 Jul 2022 08:09:18 +0000

Okay but what about all the households that want to form but can’t afford at current prices? Despite the fact that my wife and I are both full time nurses we live her parents house because we cannot afford to form our own house unit. If prices dropped enough we may just move out.

By: Han Thanh

Han Thanh — Sat, 23 Jul 2022 17:10:33 +0000

In reply to Kay Min. Say it with me: GOVERNMENT STIMULUS CREATED EXCESS DEMAND AND A BUBBLE If they try to build anything they'll inflate commodity prices further because Canada is already building one home per every 1.25 people.

By: Kay Min

Kay Min — Fri, 22 Jul 2022 03:55:46 +0000

The only way Government can do is to invest in more affordable housing units. That way can resolve housing and rental crisis for younger generations who are struggling for affordability to stay.
As the same time, the Government can punish the ones who created the crisis.

By: Patty

Patty — Thu, 21 Jul 2022 20:58:58 +0000

I agree with your article. Here in Vancouver, there are row of townhome communities that are waiting to get built by demand…there is no shortgage of land! whoever came up with that land shortgage messaging sure got away with it because it’s in everyones vocabulary. This mindset on top of low rates sure drove the overpriced market we have today (and throw some money laundering in there too!)

By: J

Thu, 21 Jul 2022 18:33:54 +0000

Bad news for the speculators and investors who stocked up on 1br 400sqft micro condos.

1. New grads don’t have the moolah to buy. The ones that got a loan or inheritance from family have already bought.

2. Couples want more space, it is not much more for a 2br condo with more space. Might as well shell out for that.

Only option left is to rent/lease out the units for market rent (whatever that will be). My guess is that it will not absorb the trigger rate increases on their existing variable mortgages. The golden goose turned rotten real fast.

By: Ava

Ava — Thu, 21 Jul 2022 15:06:49 +0000

Agreed.

By: Herbert Bourguignon

Herbert Bourguignon — Thu, 21 Jul 2022 12:07:09 +0000

“They found 30-years of driving interest rates lower helped to inflate home prices and move money from the productive economy to non-productive speculation of financialized assets. ”

Canadians have become one asset wonders! Our GDP way to reliant on housing.

We will pay a heavy price in the mid-term as we have stifled healthy economic growth in order to accrue artificially high housing asset appreciation.

By: Doomcouver

Doomcouver — Thu, 21 Jul 2022 02:53:27 +0000

Awesome. I crunched these numbers myself using census data and came to the same conclusion a couple years back. It’s great to see BMO using this to attempt to dispel the ridiculous supply shortage myth. A supply glut is coming very soon so I hope they’ll throw this in front of the “real estate experts” on the MSM when they’re confronted with the mystery of where all the supply mysteriously came from.