Not enough houses isn’t really the problem, or rather there’s no such thing as “enough houses” ever. If more housing were to become available, people would just inflate their expectations for what their housing should be (larger, more land, fancier, etc.)
There’s enough bedrooms in this country for every single person to sleep in. They just aren’t distributed properly (desirable locations, who owns them, etc.)
There will never be enough housing to meet people’s desires.
The question then becomes, how can we get the right people in the right amount and location of house, and what does right mean for these things?
The current allocation system we are using simply doesn’t achieve the optimal social outcome.
One big issue, is there are far too many older people that are over-housed. My parents live in a 4 bedroom home, by themselves. It was a great home for me and my brother to grow up in, but it hasn’t been optimal in the 20 years since we moved out. They should have downsized and freed that home up for another family. Instead you have couples in their 20s who are either underhoused for their family size or who won’t even have children because they don’t have enough space.
The only solution I’ve seen that would work is significantly taxing land based on the desirability of the location and size of land, to incentivize people to leave too much housing for their needs and free it up to house more people (either more people in the same home, or through density development). Those taxes should be really high, like income tax level of high, and income taxes should be dropped. It would overnight reset home prices to affordable levels. Unfortunately it’s never going to get voted in because it would also destroy the equity for every single current homeowner, and there’s no way they would accept that.
This one is a bit harder because the stat only collects 0 (studios) 1, 2, 3, and 4 or more.
If we average it out assuming a studio also counts as 1 bedroom (which seems reasonable to me) and only assume 4 or more equals 4 exactly (just being conservative here) then we get an average number of bedrooms per dwelling of 2.7 bedrooms.
16.4 million homes x 2.7 bedrooms per home = 44.28 million bedrooms
Even the latest Canadian population in 2023 is 40.1 million.
That’s enough rooms for every single Canadian to have their own room, and doesn’t even need to account for couples sleeping in the same room. That means every couple could have a spare bedroom for an office or guest room and there would still be enough rooms for everyone.
To match other advanced countries for citizens per house, we’d need a few million more houses. I’d call that a shortage, even if in the very long term, you’re right, we culturally adjust to whatever we have to. In a way we are already; multi-generational living is noticeably trendy.
The current allocation system we are using simply doesn’t achieve the optimal social outcome.
What you’re talking about here is basically just inequality, with a little bit of gerontocracy. Yeah, it sucks, haha. What needs to happen to fix that is more redistribution, one way or another.
Those taxes should be really high, like income tax level of high, and income taxes should be dropped. It would overnight reset home prices to affordable levels.
I don’t think so. The amount of privately held land is fixed, so somebody’s going to pay the same amount no matter what. It’s actually going to increase housing prices relative to other things, because the Zoomer family that buys your parent’s place will have that tax to bear as well (meanwhile everything else just benefits from the income tax break).
You could make it 65+ only, I guess, but there’s a high chance of unintended side effects on seniors not in that situation.
To match other advanced countries on square feet of land and house per person on average, we’d have to build a lot more smaller houses on a lot smaller lots. The unit counts only tell half the story, and everyone is somehow ignoring that.
For comparison, the UK average house size is only 41% the size of Canada, and the largest European size is Denmark and it’s still only 75% as big as Canada.
Globally, The countries having the worst time housing cost wise, are the ones with the largest average house size.
Yes I’m talking about inequality, but it’s systematic, people who’ve been around longer bought up everything in the major cities and now aren’t sharing.
The amount of privately held land is fixed, but that doesn’t mean someone’s going to pay the same amount. Not at all.
Let me ask you a question, how much would you pay for a car, if you knew that car would sell for more money in 10 years than you paid for it today. No matter how much you spend on the car, it has a 99% chance to go up in value over 10 years. The logical choice is to spend as much money as you can possibly afford, because the more you spend, the more you get back. This is what’s been happening with houses for the last 40 years.
Now tell me how much you’d spend on a car if you knew is was going to lose half of it’s value over the next 10 years, like cars normally do, and you’re going to give me a much lower number.
The tax has to be high enough to make sure you and everyone else always lose money on the house. Then, you’ll only pay for what you need, or maybe splurge a little bit more for some extras, but you wouldn’t go crazy unless you were rich.
Under this plan that Zoomer family can afford my parent’s house, because they’re working and now don’t have to pay income tax. Meanwhile it’s going to be cheaper because there’s more supply of larger houses and less demand for them. My Boomer parents wouldn’t get that tax break because they retired and all that tax is now is a significant drain on their finances unless they downsize. Further into town where those taxes would be even higher because of desirability, those houses will be bought up by developers, and turned into condos, which because the tax is on land only and not the value of the building will have even cheaper per month taxes for the occupants. Good for both my downsizing Boomer parents, and for childless folks who don’t need a full sized house.
That’s interesting about housing sizes - good to know, thank you. It kind of confirms my general sense about those places, but it’s hard to sort stereotypes from reality sometimes.
Australia and the US are the other big-houses places. I suspect it’s down to available lumber and low land values. Maybe car culture too, but the history of that is intertwined with low land values. (Russia and China score lower because they’re just generally poorer)
I’m not really sure what point you’re making with it, though. We could start renting out oversize closets and spare rooms as separate housing, and people do, but that’s not generally regarded as a good solution to the housing crisis, and in fact is fairly illegal. We could start building more smaller houses, and as far as I can anecdotally see are, but that’s still building houses.
The tax has to be high enough to make sure you and everyone else always lose money on the house. Then, you’ll only pay for what you need, or maybe splurge a little bit more for some extras, but you wouldn’t go crazy unless you were rich.
Ah, but you’re not accounting for rental income, or equivalently the rent you won’t pay if you’re buying. People need to live somewhere, legally speaking, and legally speaking will keep paying more until it’s a profitable asset for the owners again.
Illegally speaking we absolutely would have a spike in homelessness, to the point where there might be more permanent Hoovervilles/favillas being built on land that’s not technically set aside for the residents. The appreciation you’re talking about isn’t an economic fluke, it’s driven by fundamentals. Land literally just does become more sought after as the population grows (and the buildings themselves slowly depreciate as they become old, musty and awful).
My Boomer parents wouldn’t get that tax break because they retired
Presumably they get some kind of income, right? They still eat. You mean a tax break just working individuals, then. That’s kind of the same as making the house tax 65+ only, except disabled people and similar will also get swept up.
This is a nitpick since it has nothing to do with our topic, but I would also like to point out that you don’t buy something just because it appreciates, like you implied. Lots of assets do, and they do it in varying percentages that always end up matching the volatility (or actual existential risk if it’s that kind of investment) they experience on the way. The rational move is to buy whichever ones make sense given when you want to actually have your earnings available to spend (investment horizon).
I’m not really sure what point you’re making with it, though. We could start renting out oversize closets and spare rooms as separate housing, and people do, but that’s not generally regarded as a good solution to the housing crisis, and in fact is fairly illegal. We could start building more smaller houses, and as far as I can anecdotally see are, but that’s still building houses.
I’m getting at the point that we need to heavily incentivize people to move out of too much home, into appropriate sized housing for their current situation. Families need more rooms than couples. Just because you USED to have a family doesn’t mean you should be allowed to keep that same amount of space after they move out.
There is enough housing right now for everyone to have a reasonable amount, we just need to give people who have an unreasonably large amount a reason to get the fuck out.
Ah, but you’re not accounting for rental income, or equivalently the rent you won’t pay if you’re buying. People need to live somewhere, legally speaking, and legally speaking will keep paying more until it’s a profitable asset for the owners again.
Rents are tied directly to housing prices. If the price of housing goes down, so do rents. There can only be so much of a gap before renters just tell landlords to fuck off and buy their own place because it’s significantly cheaper.
The current rent prices are a reflection of the house prices being high, current house prices are not a reflection of rent prices being high. That distinction matters. House prices are high because they are profitable investments (even when sitting empty in many cases). Take away that profit, and house values with take a swan dive off a cliff.
You say it’s because there’s limited land, but the limit isn’t actually what you think it is. Vancouver has a lot of land, enough for millions of more people at density levels similar to cities like Paris or Tokyo. The problem is that it’s not available because people currently live there in detached homes that they refuse to sell because there’s no incentive to do so. The longer they hold it, the more money they make for retirement, and it doesn’t cost them anything more than they already paid to just stay.
Presumably they get some kind of income, right? They still eat. You mean a tax break just working individuals, then. That’s kind of the same as making the house tax 65+ only, except disabled people and similar will also get swept up.
I mean, some of their pensions are technically counted as income, but you’re right, I’m talking about income from jobs not pensions or other investments. It shouldn’t be age based at all, since there would be plenty of younger people who don’t work in the traditional sense either. Lots of people live off investments, family money, etc. and they shouldn’t get the break on taxes.
This is a nitpick since it has nothing to do with our topic, but I would also like to point out that you don’t buy something just because it appreciates, like you implied. Lots of assets do, and they do it in varying percentages that always end up matching the volatility (or actual existential risk if it’s that kind of investment) they experience on the way. The rational move is to buy whichever ones make sense given when you want to actually have your earnings available to spend (investment horizon).
What are you talking about, buying appreciating assets is literally what investment is. Given that you also need somewhere to live, a house is WAY too lucrative an investment for most people to avoid. If they can afford it, they buy it, that’s why home ownership is still at like 65% in Canada, a historically high percentage. I have purchased 3 houses with my wife over the years (consecutively, not at the same time) and each time we’ve bought as much as we were allowed to by the bank. We’ve made over $750k in the last 14 years in appreciation alone, in addition to the couple hundred grand in paid equity we’ve got, and that’s exactly why housing is unaffordable for everyone. That should never have happened.
The houses should have been cheaper because appreciation should have been either staved off by taxes in the first place, or taxed away.
The other thing is that wages shouldn’t have gone up as much either, because it wasn’t needed to pay for housing. Making everything else cheaper too.
Right now all the money that home owners make is coming from somewhere, and that somewhere is workers who are the only ones who actually produce value to be taxed.
I’d be curious to find out if these stats take into account the prevalence of secondary (or even tertiary) suites, especially the unofficial ones. Officially the place I live in is a single family home, originally designed for a family of 4. My family of 3 lives in about 700sqft and there’s another family of 4 living in about 1000sqft upstairs. Do the stats count us as 1 household? I’ve never been sent a census form to fill out, I don’t have a legally distinct address or seperate utilities. I know many people in similar living arrangements, how are we counted in the statistics?
It’s StatsCan, so a household is defined as all the people living in a single unit together. It usually comes down to, if you share a kitchen with the other people, you’re considered 1 household. If you have separate kitchens, you get a separate census to fill out. Five roommates in a house next to a university would be 1 household for the purposes of the census which is completed every 5 years.
Right, but I guess my point is how would statscan know if a house has 1, 2, 3, or 4 units if they all share the same official address? Tax data? Driver’s licence/service cards? And as for the census, how is it accurate if only one of the households in a multi unit house gets one?
Either way it’s irrelevant to this discussion, because the article you linked didn’t use statscan data:
Most data was curated from a select number of sources: Japan Statistical Yearbook, European Housing 2002, Australian Bureau of Statistics, Canadian Home Builders Association, Infometrics, US Census.
As you said it doesn’t really matter. Number of rooms isn’t a census question. Neither is the population.
Census households generally report accurately because the data isn’t reported to anyone else so there’s no downside to being truthful. It’s also correlated with other data to double check the validity.
The discussion is are there enough rooms for everyone? The answer is overwhelmingly yes. Our distribution is just absolutely fucked up.
Yeah, without reading this I’m hella skeptical.
No amount of tenant rights will solve not enough houses, which is the problem we have here.
Not enough houses isn’t really the problem, or rather there’s no such thing as “enough houses” ever. If more housing were to become available, people would just inflate their expectations for what their housing should be (larger, more land, fancier, etc.)
There’s enough bedrooms in this country for every single person to sleep in. They just aren’t distributed properly (desirable locations, who owns them, etc.)
There will never be enough housing to meet people’s desires.
The question then becomes, how can we get the right people in the right amount and location of house, and what does right mean for these things?
The current allocation system we are using simply doesn’t achieve the optimal social outcome.
One big issue, is there are far too many older people that are over-housed. My parents live in a 4 bedroom home, by themselves. It was a great home for me and my brother to grow up in, but it hasn’t been optimal in the 20 years since we moved out. They should have downsized and freed that home up for another family. Instead you have couples in their 20s who are either underhoused for their family size or who won’t even have children because they don’t have enough space.
The only solution I’ve seen that would work is significantly taxing land based on the desirability of the location and size of land, to incentivize people to leave too much housing for their needs and free it up to house more people (either more people in the same home, or through density development). Those taxes should be really high, like income tax level of high, and income taxes should be dropped. It would overnight reset home prices to affordable levels. Unfortunately it’s never going to get voted in because it would also destroy the equity for every single current homeowner, and there’s no way they would accept that.
This would be a very useful stat for us all to have if you can back it up. I’d also be interested if it is still true of individual provinces.
So, I don’t think this exists as a discrete statistic, but here’s some math to back it up.
Housing units in Canada https://www150.statcan.gc.ca/n1/daily-quotidien/230116/dq230116d-eng.htm Approximately 16.4 million units in 2021
Bedrooms per dwelling https://www12.statcan.gc.ca/census-recensement/2021/dp-pd/prof/details/page.cfm?LANG=E&GENDERlist=1%2C2%2C3&STATISTIClist=4&HEADERlist=20&SearchText=Canada&DGUIDlist=2021A000011124
This one is a bit harder because the stat only collects 0 (studios) 1, 2, 3, and 4 or more. If we average it out assuming a studio also counts as 1 bedroom (which seems reasonable to me) and only assume 4 or more equals 4 exactly (just being conservative here) then we get an average number of bedrooms per dwelling of 2.7 bedrooms.
16.4 million homes x 2.7 bedrooms per home = 44.28 million bedrooms
Even the latest Canadian population in 2023 is 40.1 million.
That’s enough rooms for every single Canadian to have their own room, and doesn’t even need to account for couples sleeping in the same room. That means every couple could have a spare bedroom for an office or guest room and there would still be enough rooms for everyone.
Thanks for math, appreciate
To match other advanced countries for citizens per house, we’d need a few million more houses. I’d call that a shortage, even if in the very long term, you’re right, we culturally adjust to whatever we have to. In a way we are already; multi-generational living is noticeably trendy.
What you’re talking about here is basically just inequality, with a little bit of gerontocracy. Yeah, it sucks, haha. What needs to happen to fix that is more redistribution, one way or another.
I don’t think so. The amount of privately held land is fixed, so somebody’s going to pay the same amount no matter what. It’s actually going to increase housing prices relative to other things, because the Zoomer family that buys your parent’s place will have that tax to bear as well (meanwhile everything else just benefits from the income tax break).
You could make it 65+ only, I guess, but there’s a high chance of unintended side effects on seniors not in that situation.
To match other advanced countries on square feet of land and house per person on average, we’d have to build a lot more smaller houses on a lot smaller lots. The unit counts only tell half the story, and everyone is somehow ignoring that.
https://shrinkthatfootprint.com/how-big-is-a-house/#%3A~%3Atext=The+average+house+size+in%2C2+(1%2C948+ft2).
For comparison, the UK average house size is only 41% the size of Canada, and the largest European size is Denmark and it’s still only 75% as big as Canada.
Globally, The countries having the worst time housing cost wise, are the ones with the largest average house size.
Yes I’m talking about inequality, but it’s systematic, people who’ve been around longer bought up everything in the major cities and now aren’t sharing.
The amount of privately held land is fixed, but that doesn’t mean someone’s going to pay the same amount. Not at all.
Let me ask you a question, how much would you pay for a car, if you knew that car would sell for more money in 10 years than you paid for it today. No matter how much you spend on the car, it has a 99% chance to go up in value over 10 years. The logical choice is to spend as much money as you can possibly afford, because the more you spend, the more you get back. This is what’s been happening with houses for the last 40 years.
Now tell me how much you’d spend on a car if you knew is was going to lose half of it’s value over the next 10 years, like cars normally do, and you’re going to give me a much lower number.
The tax has to be high enough to make sure you and everyone else always lose money on the house. Then, you’ll only pay for what you need, or maybe splurge a little bit more for some extras, but you wouldn’t go crazy unless you were rich.
Under this plan that Zoomer family can afford my parent’s house, because they’re working and now don’t have to pay income tax. Meanwhile it’s going to be cheaper because there’s more supply of larger houses and less demand for them. My Boomer parents wouldn’t get that tax break because they retired and all that tax is now is a significant drain on their finances unless they downsize. Further into town where those taxes would be even higher because of desirability, those houses will be bought up by developers, and turned into condos, which because the tax is on land only and not the value of the building will have even cheaper per month taxes for the occupants. Good for both my downsizing Boomer parents, and for childless folks who don’t need a full sized house.
That’s interesting about housing sizes - good to know, thank you. It kind of confirms my general sense about those places, but it’s hard to sort stereotypes from reality sometimes.
Australia and the US are the other big-houses places. I suspect it’s down to available lumber and low land values. Maybe car culture too, but the history of that is intertwined with low land values. (Russia and China score lower because they’re just generally poorer)
I’m not really sure what point you’re making with it, though. We could start renting out oversize closets and spare rooms as separate housing, and people do, but that’s not generally regarded as a good solution to the housing crisis, and in fact is fairly illegal. We could start building more smaller houses, and as far as I can anecdotally see are, but that’s still building houses.
Ah, but you’re not accounting for rental income, or equivalently the rent you won’t pay if you’re buying. People need to live somewhere, legally speaking, and legally speaking will keep paying more until it’s a profitable asset for the owners again.
Illegally speaking we absolutely would have a spike in homelessness, to the point where there might be more permanent Hoovervilles/favillas being built on land that’s not technically set aside for the residents. The appreciation you’re talking about isn’t an economic fluke, it’s driven by fundamentals. Land literally just does become more sought after as the population grows (and the buildings themselves slowly depreciate as they become old, musty and awful).
Presumably they get some kind of income, right? They still eat. You mean a tax break just working individuals, then. That’s kind of the same as making the house tax 65+ only, except disabled people and similar will also get swept up.
This is a nitpick since it has nothing to do with our topic, but I would also like to point out that you don’t buy something just because it appreciates, like you implied. Lots of assets do, and they do it in varying percentages that always end up matching the volatility (or actual existential risk if it’s that kind of investment) they experience on the way. The rational move is to buy whichever ones make sense given when you want to actually have your earnings available to spend (investment horizon).
I’m getting at the point that we need to heavily incentivize people to move out of too much home, into appropriate sized housing for their current situation. Families need more rooms than couples. Just because you USED to have a family doesn’t mean you should be allowed to keep that same amount of space after they move out.
There is enough housing right now for everyone to have a reasonable amount, we just need to give people who have an unreasonably large amount a reason to get the fuck out.
Rents are tied directly to housing prices. If the price of housing goes down, so do rents. There can only be so much of a gap before renters just tell landlords to fuck off and buy their own place because it’s significantly cheaper.
The current rent prices are a reflection of the house prices being high, current house prices are not a reflection of rent prices being high. That distinction matters. House prices are high because they are profitable investments (even when sitting empty in many cases). Take away that profit, and house values with take a swan dive off a cliff.
You say it’s because there’s limited land, but the limit isn’t actually what you think it is. Vancouver has a lot of land, enough for millions of more people at density levels similar to cities like Paris or Tokyo. The problem is that it’s not available because people currently live there in detached homes that they refuse to sell because there’s no incentive to do so. The longer they hold it, the more money they make for retirement, and it doesn’t cost them anything more than they already paid to just stay.
I mean, some of their pensions are technically counted as income, but you’re right, I’m talking about income from jobs not pensions or other investments. It shouldn’t be age based at all, since there would be plenty of younger people who don’t work in the traditional sense either. Lots of people live off investments, family money, etc. and they shouldn’t get the break on taxes.
What are you talking about, buying appreciating assets is literally what investment is. Given that you also need somewhere to live, a house is WAY too lucrative an investment for most people to avoid. If they can afford it, they buy it, that’s why home ownership is still at like 65% in Canada, a historically high percentage. I have purchased 3 houses with my wife over the years (consecutively, not at the same time) and each time we’ve bought as much as we were allowed to by the bank. We’ve made over $750k in the last 14 years in appreciation alone, in addition to the couple hundred grand in paid equity we’ve got, and that’s exactly why housing is unaffordable for everyone. That should never have happened.
The houses should have been cheaper because appreciation should have been either staved off by taxes in the first place, or taxed away.
The other thing is that wages shouldn’t have gone up as much either, because it wasn’t needed to pay for housing. Making everything else cheaper too.
Right now all the money that home owners make is coming from somewhere, and that somewhere is workers who are the only ones who actually produce value to be taxed.
I’d be curious to find out if these stats take into account the prevalence of secondary (or even tertiary) suites, especially the unofficial ones. Officially the place I live in is a single family home, originally designed for a family of 4. My family of 3 lives in about 700sqft and there’s another family of 4 living in about 1000sqft upstairs. Do the stats count us as 1 household? I’ve never been sent a census form to fill out, I don’t have a legally distinct address or seperate utilities. I know many people in similar living arrangements, how are we counted in the statistics?
It’s StatsCan, so a household is defined as all the people living in a single unit together. It usually comes down to, if you share a kitchen with the other people, you’re considered 1 household. If you have separate kitchens, you get a separate census to fill out. Five roommates in a house next to a university would be 1 household for the purposes of the census which is completed every 5 years.
Right, but I guess my point is how would statscan know if a house has 1, 2, 3, or 4 units if they all share the same official address? Tax data? Driver’s licence/service cards? And as for the census, how is it accurate if only one of the households in a multi unit house gets one?
Either way it’s irrelevant to this discussion, because the article you linked didn’t use statscan data:
As you said it doesn’t really matter. Number of rooms isn’t a census question. Neither is the population.
Census households generally report accurately because the data isn’t reported to anyone else so there’s no downside to being truthful. It’s also correlated with other data to double check the validity.
The discussion is are there enough rooms for everyone? The answer is overwhelmingly yes. Our distribution is just absolutely fucked up.