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Many of Canada's urban centres have been experiencing a well-known phenomena — the managed escalation of housing prices, creating a glass dome over centres like southern Ontario, Montreal, Vancouver and even Halifax.
Housing management in southern Ontario, particularly in Toronto, has been amateurish at best. When a Ontario ministry or media agent needs expertise and direction regarding housing, it is an official from the real-estate sector that shows up.
The problem is that housing starts, price increases with extremely low housing stocks are all managed by developers and real-estate organizations. Yet it is this sector that does not meet our populations requirements and also drives the price of homes in a upward direction.
The scarcity of land in this area is also part of the problem. Developers hold ownership of many land areas that are intended for development, but not in the near future. Canada's housing sector is booming through out the nation because of the Vancouver-Toronto Demand Belt. Investors and potential home buyers who cannot afford the million-dollar-plus price tag of metropolitan Toronto have gone elsewhere to buy.
The process they experienced in Toronto, that of auctions and non-transparent bidding, has come along with them. A house that cost $125,000 in Halifax now costs over $300,000. A home I saw in Thunder Bay on the lakeshore that cost $188,900 sold recently for twice that amount. The Toronto fever is spreading all over the nation, and with it the dreaded "inflation" has shown its face.
The private sector has constantly spoken about a free market within the housing sector, and with it competition that will find a living level within the sector. Yet this system continually drives the price of housing upward. That is because this sector has no real competition from which low costing well made housing can drive the cost of housing downward to an acceptable level.
So competition they want? Competition they should get. Let the government of Canada get directly involved in the development and building of real "affordable housing." Municipal and provincial governments, led by the federal government, should become partners and majority holders of house building leaders to achieve well-made but affordable apartment buildings, townhomes and even houses.
They would probably buy materials in the same price range as private firms, but the profit levels will be amortized over a very long term. Present-day developers and real estate agencies attempt to achieve near-immediate or short-term profits at escalated levels.
Create a large stock of affordable homes and the glass dome may disappear.
The costs can be managed if the various levels of government in Canada would offer the land plots they own as places to build upon.
Also, long-term mortgages over 99 years can be arranged. Renters can be offered various options that would ensure occupancy of these properties. Rent-to-own with transferrable ownership. The various properties can offer communal bond options with reasonable interest to bring in revenue. Canadians would be building "homes" and not investment opportunities.
Canadians must change the way they imagine housing. Costly homes can be owned by the wealthy. No problem, but a real affordable housing sector must be created. More homes being made, more people employed.
A housing revolution is required in Canada.