As Canada and other countries try to deal with their respective affordable housing challenges, a Dutch cabinet minister recently attempted to even the playing field and expand home ownership among the less wealthy.
Housing Minister Hugo de Jonge had proposed a law that would have allowed municipalities to force homeowners, whose homes were worth up to $355,000 Euros (about $517,000 Cdn) to put their property on the market only to low and middle-income earners.
That meant local governments could refuse to grant residency permits to wealthy potential buyers and keep them out of the market for homes up to that value
The problem the policy is trying to fix is one that’s particularly acute in Canada, said Jeremy Withers, the outreach co-ordinator for the University of Toronto’s School of Cities Affordable Housing Challenge Project.
“And that problem is that prospective first-time buyers are finding it increasingly difficult to compete in bidding wars for housing,” said Withers, who is also a PHD candidate in the department of Geography & Planning at the University of Toronto.
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Housing issues in Canada
Over the past decade, Withers said, a fast-growing share of housing has been bid up and acquired by higher income Canadians who already own their homes but are building up portfolios of investment properties.
For example, 45 per cent of Ontario condo apartments and 18 per cent of Ontario houses are not owner occupied, he said, citing Statistics Canada data.
“I think policies that aim at curtailing demand from kind of wealthy, high income bidders would likely help to mitigate continuing rise in prices and wealth inequality that’s really come to define Canada’s private housing system.”
De Jonge’s proposal, while initially looking like it might have support in parliament, was ultimately defeated, but not before stirring up controversy and opposition for infringing on the property rights of homeowners.
The proposal by Dutch Housing Minister Hugo De Jonge, seen speaking to media in The Hague in May 2022, was ultimately defeated, but not before stirring up controversy and opposition for infringing on the property rights of homeowners. (Lex Van Lieshout/AFP/Getty Images)
Still, Dutch proponents of the law echoed Withers’ comments, noting that much cheaper houses are now out of reach for people with an average salary.
“Now house seekers in a village are outbid by people from outside who have a lot of money to spend,” Christian Union party member Pieter Grinwis told the Netherlands’ AD newspaper.
Although Canada faces a similar issues, some housing experts here questioned whether such measures are the right approach.
“For the Canadian context, what we need more fluidity in the market, not more constraints,” said Mathieu Laberge, an government advisor at KPMG and former chief economist at the Canada Mortgage and Housing Corporation.
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‘Unforeseen negative consequences’
“When you look in the literature, coercive approaches, they’re well intentioned, but they tend to bring in unforeseen negative consequences,” Laberge said.
“I think it would set up a whole lot of disincentive. If you own a house in this spectrum and now you see a large portion of your potential buyers forbidden to buy, why would new home owners enter this market?
Paul Anglin professor of real estate at the University of Guelph, questioned some of the practical aspects of the Dutch proposal, and whether it would just cause housing prices to rise.
“If I were a seller, I would tend to choose a list price above the limit. Doing so would remove the constraint,” he said in an email.
“If the goal of the proposal is to improve the social goal of fairness, should the law account for the income of the seller also?”
Subsidies, building housing, co-ops
Anglin suggested that the responsibility for housing affordability is being dumped on the home owner.
“A solution which is administratively simpler than this proposal would be to use tax money to directly subsidize purchases by people who are deemed worthy,” he said.
Toronto city councillor Brad Bradford, who is also chair of the Planning & Housing Committee, said the solution to the housing affordability crisis isn’t more bureaucracy, or having the government decide who is allowed to buy someone’s house.
“The solution is to build more homes, so people have more options to rent or buy at different price points,” he said in a statement. “The city needs to streamline approvals and eliminate unnecessary rules and guidelines to get more housing built faster.”
Toronto city councillor Brad Bradford, who is also chair of the Planning & Housing Committee, said the solution to the housing affordability crisis isn’t more bureaucracy, but rather building more homes. (Nav Rahi/CBC)
Laberge believes there should be more focus on initiatives like co-ops — rental apartments where a collective of tenants are the owners of the building and where some people pay a higher rent to enable more affordable units for those who need them.
“We used to have a bunch of co-ops,” Laberge said. “Co-ops are successful worldwide in terms of providing affordable housing, but somehow Canada departed from co-ops in the early ’80s. That’s something we could revisit.”
Withers said that while he supports the Dutch idea of addressing the issue of demand and inequality, he was unclear how exactly the mechanics of the proposal would work.
Taxation on investors
He suggested that in Canada, a better way to open the housing market to less wealthy prospective buyers would be through taxation on investors.
That could include increasing the capital gains tax on money made when investors sell residences, or requiring an additional land transfer tax for buyers who already own multiple properties, he said.
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As well, Withers suggested that local investors who don’t plan to live in the homes they buy could be made to pay the same taxes that foreign investors face when purchasing units.
“And this would discourage them from outbidding prospective homeowners,” he said.
EDMONTON – RCMP say a second suspect has been arrested in the killing of an Alberta county worker.
Mounties say 28-year-old Elijah Strawberry was taken into custody Friday at a house on O’Chiese First Nation.
Colin Hough, a worker with Rocky View County, was shot and killed while on the job on a rural road east of Calgary on Aug. 6.
Another man who worked for Fortis Alberta was shot and wounded, and RCMP said the suspects fled in a Rocky View County work truck.
Police later arrested Arthur Wayne Penner, 35, and charged him with first-degree murder and attempted murder, and a warrant was issued for Strawberry’s arrest.
RCMP also said there was a $10,000 reward for information leading to the arrest of Strawberry, describing him as armed and dangerous.
Chief Supt. Roberta McKale, told a news conference in Edmonton that officers had received tips and information over the last few weeks.
“I don’t know of many members that when were stopped, fuelling up our vehicles, we weren’t keeping an eye out, looking for him,” she said.
But officers had been investigating other cases when they found Strawberry.
“Our investigators were in O’Chiese First Nation at a residence on another matter and the major crimes unit was there working another file and ended up locating him hiding in the residence,” McKale said.
While an investigation is still underway, RCMP say they’re confident both suspects in the case are in police custody.
This report by The Canadian Press was first published Sept. 13, 2024.
RICHMOND, B.C. – The Integrated Homicide Investigation Team says the 26-year-old son of a man found dead on British Columbia’s Sunshine Coast has been charged with his murder.
Police say 58-year-old Henry Doyle was found badly injured on a forest service road in Egmont last September and died of his injuries.
The homicide team took over when the BC Coroners Service said the man’s death was suspicious.
It says in a statement that the BC Prosecution Service has approved one count of first-degree murder against the man’s son, Jackson Doyle.
Police say the accused will remain in custody until at least his next court appearance.
The homicide team says investigators remained committed to solving the case with the help of the community of Egmont, the RCMP on the Sunshine Coast and in Richmond, and the Vancouver Police Department.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, have broken off without an agreement following 15 hours of talks.
Joe McCann, president of Amalgamated Transit Union Local 1724, says they stayed at the bargaining table with help from a mediator until 2 a.m. Friday and made “some progress.”
However, he says the union negotiators didn’t get an offer that they could recommend to the membership.
McCann says that in some ways they are close to an agreement, but in other areas they are “miles apart.”
About 600 employees of the door-to-door transit service for people who can’t navigate the conventional transit system have been on strike since last week, pausing service for all but essential medical trips.
McCann asks HandyDART users to be “patient,” since they are trying to get not only a fair contract for workers but also a better service for customers.
He says it’s unclear when the talks will resume, but he hopes next week at the latest.
The employer, Transdev, didn’t reply to an interview request before publication.
This report by The Canadian Press was first published Sept. 13, 2024.
