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Cost of housing in Canada

I think that's a question of the scale of the crash. Lot's of boomer/older x age people planned to retire off the equity in their homes. But were they planning on the post 2019 explosion? Does a crash to 2018 prices jeopardize their retirement, or clawback an unplanned for windfall?
Housing has been the "retirement plan" for people for a lot longer than 2018, and the ones that will really suffer if things go sideways are the Gen-X/Millennials who bought in the 2010s, and couldn't afford to put away money because mortgage payments already ate up a huge chunk of their take home pay.
 
Everyone in the first few deciles will have homes. If there aren't enough of the kind of homes people want for the money they have, though, they will look further down - buy and renovate or demolish/build. This moves "affordable" properties out of reach of the people lower on the scale. Unless the demand of the top tiers is saturated, we can assume this is happening.
Agreed, we can assume it is happening, but we shouldn't overstate the scale of it's impact, and certainly not project that overstated impact onto a scenario where there is enough overall supply (albeit not of the right "sizes").

You know as well as I that the decile example is useful for a simple and effective illustration, but bares no resemblance to the real-world distribution as determined by means/affordability. We need to fix the shortfall at the mode, not from the tail in. Proportionally there aren't enough of the people getting pushed down to seriously destabilize a balanced (supply/demand) normal market.
 
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Housing has been the "retirement plan" for people for a lot longer than 2018, and the ones that will really suffer if things go sideways are the Gen-X/Millennials who bought in the 2010s, and couldn't afford to put away money because mortgage payments already ate up a huge chunk of their take home pay.
What I was getting at that no one should have been "planning" for the surge of the last five years. Price change went damn near asymptotic. I have next to zero sympathy for people that bought in the 90's or early 00's that need the equity levels of 2021-2023 pricing rather than say 2015-2018 pricing.

Similar to people that bought in the early 10's. A sudden and painfull roll back to 2018 levels followed by a return to a nice 3% annual rise shouldn't be calamity.
 
I was just reading a bit about mesolithic hunter gatherers and the transition in NW Europe to the neolithic.
I have also been watching with fascination modern humans attempt the hunter gatherer lifestyle in the Alone series.

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One of the biggest revelations to me is how quickly people can create a shelter and then adapt themselves to living in that shelter for a long period of time. None of the contestants drop out because they don't like the paint job, or cabinetry. As long as there is a roof over their head to keep the rain, the wind and the snow at bay, and a smokeless fire to keep them warm then they have met their minimum shelter requirements.

What drives most contestants to quit is the lack of food available and the lack of company.

Historically the lack of food is countered by mobility. Kayaks and coracles and sleds pulled buy dogs and deer permitted foraging over large areas.

What happens if -

People start prioritizing a car over a permanent roof?

Start living in provincial parks and crownland in their cars or vans, in tents and commute into the settled spaces to hunt for work and gather paychecks? Is the next step to claim their campsite? To start improving it? Digging holes. Building dirt and stone walls and chimneys? Timber walls? Wattle roofs? Rail fences?

There is lots of evidence of people setting up tent encampments in cities, reflective of the old hobo jungles of the thirties.
There is lots of evidence of people who lose their home holding on to their vehicles as a last refuge and for its mobility.
Saskatoon's early settlers found themselves surviving their first winters by digging caves into the dirt of the riverbank.
Flat landers with no trees dug up sods of grass and stacked them over the pits they dug and built soddies.

Municipal planning rules all prevent such temporary accommodation measures but we are already seeing that authority has its limits and that zones of anarchy are spreading. Although I am not sure that anarchy is the right word because I am willing to bet that each of those tent villages has a structure with fixers and organizers and spokes people and enforcers. So perhaps it is more appropriate to speak of "no go areas"? Modern history offers Yorkville in Toronto, Gastown in Vancouver, Haight-Ashbury in San Francisco, the People's Republic of Fremont in Seattle and more recently the Capitol Hill Autonomous Zone, Christiania in Copenhagen....multiple temporary communities along the US-Mexico border.

If authority stands in the way of Maslow authority loses.

People immigrating to Canada may all aspire to what they see on the TV back in their homelands but many of them are used to living a lot rougher than us locals. Another year or two of living rough to build a different future may deter some but historical evidence suggests to me that it will be just another hurdle for many.

In my lifetime, which isn't that long, I have seen locals complain about neighbourhoods being taken over by immigrants swarming into houses that used to house one family. I saw it with Italian streets in England. West Indian and Pakistani streets over there as well. Sikh streets in the Lower Mainland. My grandparents talked about the Highlanders and the Irish coming into Glasgow. Archaeology has shown that Karl Marx's industrial slums of the 1830s and '40s, when they were built 70 years previously as planned communities by the factory owners, were well appointed single family homes suitable for a middle class lifestyle that attracted all sorts of cold, damp and starving labourers from the farms. They told their brothers and sisters and soon you had multiple nuclear families living under one roof. Ultimately demand outstripped supply and more people crowded under the available roofs and divided up the large space in smaller private spaces. The factor owners benefited from the increased supply of labour and the price of labour decreased. .....

We have been here before....

The silly people are those that never understood the lesson of Canute and try to control the tides of nature by exerting authority.
 
Here's what I'm talking about, and I believe it ties into what @Kirkhill and @Halifax Tar are saying as well.
2022-data-insights-sfd.png


This is where the market has lead. Can we afford to leave it here? Land and annual building capacity for SDH's is finite. Society would be better served with those limited resources returning to 90's construction sizes, but there is enough demand to justify the profit maximization of the larger homes. Seems to be a broken market
 
Here's what I'm talking about, and I believe it ties into what @Kirkhill and @Halifax Tar are saying as well.
2022-data-insights-sfd.png


This is where the market has lead. Can we afford to leave it here? Land and annual building capacity for SDH's is finite. Society would be better served with those limited resources returning to 90's construction sizes, but there is enough demand to justify the profit maximization of the larger homes.
Spot on.

And if you go back to the wartime boom of the 1950s I think you will find the norm was closer to 800 square feet with fewer bedrooms and bigger families.
 
Spot on.

And if you go back to the wartime boom of the 1950s I think you will find the norm was closer to 800 square feet with fewer bedrooms and bigger families.
Before that it was mud huts and sticks for entertainment...

There is a limit as to how far "backwards" people will be willing to go before things get ugly. Homes that aren't McMansions is relatively easy to sell if they are still "reasonably" sized based on people's expectations/wants.

I'm guessing the increasing size of homes is as tied to developers realizing that for about the same cost they can make a larger home and sell it for more money, as it is tied to people's expectations.
 
building costs in Toronto in 2022 were 165 per sq. ft. which puts a 2000 sq. ft. house cost at 330,000. The rest is greed, profit, land costs and taxes. Making the land ava/ilable to build (they had a great chance at that in Downsview and blew it) would certainly help. Restricting the build size and luxury add-ons another plus. Auction off the lots to new home owners/current area residents again is good but how to prevent opportunists from jumping in I don't know. P|erhaps maintain ownership of the land and rent out the lots only. Oh, and forget the really high density tiny lot thing, you want families to move in and kids need a place to play. Consider Hawaii, the city is devastated and luxury money is there buying current owners out.
 
Society would be better served with those limited resources returning to 90's construction sizes, but there is enough demand to justify the profit maximization of the larger homes. Seems to be a broken market
SDH are actually the least profitable for developers/builders. There’s far more margin/profit made on semis, townhomes and low/high-density condos, per land footprint.

I live in a 2350 sqft house on an acre out in a rural/semi-rural area. The builder probably pocketed between 75-100k on the build. Profit of $100k/44,000sf = $2.27 per sf. About 15 minutes north of me is a dense townhome development with about 20-22 townhomes per acre. Given their cost, I wouldn’t be surprised if the builders made 100K+ on each unit, so that’s $2.0M/44,000sf= $45.45 per sf, or 20x the profit on a single home like mine. There are clearly some data points in between these two, but the ‘more money in it for single detached homes’ is a fallacy. Builders build SDH because there’s a market for them, ie. People are willing to pay for them for what they want and can get.

This problem now has its roots decades back, and it comes from societal attitudes that kept housing supply on the relative shortage side for quite a while. Currently, shortage is resulting from a number of factors (including a societally acceptable wide view that higher education would lead to a higher lifestyle as well as a near-disdain like looking down on the trades) and housing demand (both owned and rented) continues to lead supply.
 
Proportionally there aren't enough of the people getting pushed down to seriously destabilize a balanced (supply/demand) normal market.
How do we know that? People who can afford West Vancouver and can't find a house start looking in the next most decent markets, but with a bigger budget than the people who ordinarily shop in the latter. The effect necessarily cascades. And we can't know how stable prices are (eg. large output change in response to small input change) without equations which accurately model prices and numbers of sellers, buyers, etc.

Detached houses should be approximately maximized according to lot size, allowing for suites, laneway suites, and on-property parking.
 
SDH are actually the least profitable for developers/builders. There’s far more margin/profit made on semis, townhomes and low/high-density condos, per land footprint.

I live in a 2350 sqft house on an acre out in a rural/semi-rural area. The builder probably pocketed between 75-100k on the build. Profit of $100k/44,000sf = $2.27 per sf. About 15 minutes north of me is a dense townhome development with about 20-22 townhomes per acre. Given their cost, I wouldn’t be surprised if the builders made 100K+ on each unit, so that’s $2.0M/44,000sf= $45.45 per sf, or 20x the profit on a single home like mine. There are clearly some data points in between these two, but the ‘more money in it for single detached homes’ is a fallacy. Builders build SDH because there’s a market for them, ie. People are willing to pay for them for what they want and can get.

This problem now has its roots decades back, and it comes from societal attitudes that kept housing supply on the relative shortage side for quite a while. Currently, shortage is resulting from a number of factors (including a societally acceptable wide view that higher education would lead to a higher lifestyle as well as a near-disdain like looking down on the trades) and housing demand (both owned and rented) continues to lead supply.

Property tax revenue for municipalities is far higher in high density areas also. My property costs me about 5k/yr in property tax, nearby townhouses (4 units) on a similar foot print that I have are paying roughly 2200 each /yr. 8800 vs 5000 for the same size parcel.
 
How do we know that?
Income distributions coupled with target affordability ratios. We know the income breakdowns of the population. We know the max they can get approved for/should be paying. We know how steep that curve gets after the 90th or even 75th percentile. If we have enough homes available at a price point 80% of the population can afford, a small fraction in the 81-83 range that can't get exactly what they want isn't going to upend the whole thing.
 
SDH are actually the least profitable for developers/builders. There’s far more margin/profit made on semis, townhomes and low/high-density condos, per land footprint.

I live in a 2350 sqft house on an acre out in a rural/semi-rural area. The builder probably pocketed between 75-100k on the build. Profit of $100k/44,000sf = $2.27 per sf. About 15 minutes north of me is a dense townhome development with about 20-22 townhomes per acre. Given their cost, I wouldn’t be surprised if the builders made 100K+ on each unit, so that’s $2.0M/44,000sf= $45.45 per sf, or 20x the profit on a single home like mine. There are clearly some data points in between these two, but the ‘more money in it for single detached homes’ is a fallacy. Builders build SDH because there’s a market for them, ie. People are willing to pay for them for what they want and can get.
Custom homes on private lots are a completely different ball game than subdivision development

Bold. It is, but that's not the point that's being argued. It's not that builders are building SDH's because there's more money in it, relative to density- because not that's not accurate. it's that where builders can/have to build SDH's they're building larger and larger because there's more money in it, because, as you said, there's a market for it.

We need a mix of housing, SDH's are a part of that. Over the last ten years the SDH proportion of the mix has slid from ~40% to ~20%, while the sizes have gotten larger and larger. What's done is done, there's no point looking back. But looking forward, if there is x amount of development land that's going into SDH's, is a society with a critical shortage of housing better served with x number of 2500sqft homes with 36 corners in the foundations and stupid rooflines full of valleys that will leak within ten years, or x+y 1600 sqfoot rectangles with single ridgelines?
 
You’re trying to focus on size of SDH being the main cause factor remains a complaint of the size of the elephant’s tail…
 
You’re trying to focus on size of SDH being the main cause factor remains a complaint of the size of the elephant’s tail…
I'm not trying to focus on it "being the main cause factor", I'm pointing it out as a factor. In Ontario we're (charitably) at 100k per year output. ~20% of that is SDH. Ten year output of 1mm, 200k SDH. Target to get things under control is 1.5mm. 500k shortfall.

If a hypothetical cross the board size reduction of the production homes in SDH subdivisions (not custom builds) of 50% could lead to a 25% increase in what can be built on the available land, with the available work force, that makes up 10% of the shortfall and has the majority 250k SDH's built in the decade done so at a lower price point.

There's no silver bullet, but status quo practices are part of what has lead us here.
 
There's no silver bullet, but status quo practices are part of what has lead us here.
Actually status quo practices would have kept SDH size back at your acceptable levels. SDH size has grown, again, based on demand. Forcing new SDH’s to be reduced in size, through whatever measures you think are appropriate (seems you favour government control, so I’ll assume some flow down of federal to provincial to municipally mandated restrictive permitting) will be less effective than increasing density of housing in areas where population growth is happening…unless of course you propose forcing citizens to buy homes in less populous areas to resolve land use pressures.
 
Actually status quo practices would have kept SDH size back at your acceptable levels. SDH size has grown, again, based on demand. Forcing new SDH’s to be reduced in size, through whatever measures you think are appropriate (seems you favour government control, so I’ll assume some flow down of federal to provincial to municipally mandated restrictive permitting) will be less effective than increasing density of housing in areas where population growth is happening…unless of course you propose forcing citizens to buy homes in less populous areas to resolve land use pressures.
The status quo is the current situation. Not the situation 20 years ago.

My proposed method was via structured selective incentive. Expand the since announced GST exemption, and make low interest loans available.

How exactly would you differentiate between "increasing density of housing in areas where population growth is happening" and "build more, smaller, production SDH's on large scale developments"? The latter is quite literally a specific subset of the former.
 
How exactly would you differentiate between "increasing density of housing in areas where population growth is happening" and "build more, smaller, production SDH's on large scale developments"?
…increase lo/med/high-rise and high-density townhomes on remaining residentially-zoned lands in the places where demand outstrips supply the greatest. There is a far greater proportional increase in person-spots that way than there would be forcing a mandatory reduction in DSH size.
 
…increase lo/med/high-rise and high-density townhomes on remaining residentially-zoned lands in the places where demand outstrips supply the greatest. There is a far greater proportional increase in person-spots that way than there would be forcing a mandatory reduction in DSH size.
Ah. So not in your back yard?
Decreasing in SDH size is increasing the density in the lo density band. It's the same thing, just not to the same extent.

And incentivizing isn't making mandatory.
 
Ah. So not in your back yard?
Decreasing in SDH size is increasing the density in the lo density band. It's the same thing, just not to the same extent.

And incentivizing isn't making mandatory.
I’m rural/semi-rural…lots of land and the smell of cows with a SE wind. There is no shortage of residential land where I live, and only people who want to be this far away from a city are…some big SDHs, some medium-sized SDHs, some small SDHs…even a few trailer parks nearby. No buses, no fire hydrants, no sewers. There actually is a sub-development of townhomes in the middle of the country nearby…weirdest thing I’ve seen, but no NIMBY thing going on…developers don’t feel restricted from building whatever they want. You seem bent on making SDHs shrink in suburban and urban areas to solve the problem. I don’t see a lot of mansion type houses going on inside downtown Ottawa, just apartments, condos and in suburbia it’s waves of townhomes for the most part. My point remains that where there is remaining residential development land in urban and suburban areas, emphasis should be made on efficient, higher-density housing biased towards vertical development. If someone wants to build a larger SDH out from the city where there is relatively plentiful land, let them, not impose some kind of Mother/Government Knows Best kind of restricted home size.
 
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