Why are we building more dwellings for investors?
The government’s narrow focus on adding more housing begs the question, why are we building more housing for investors?
I don’t recall having to compete with corporate money when purchasing my home way back when. Fast forward to today, one of the most rapidly growing segments of home buyers is investors. Chief among them are corporations.
The Star has previously written about Core Development Group and its $1-billion fund to purchase single-family homes to rent them out.
One billion dollars and not a single unit added to the housing supply.
Even the most dysfunctional branch of any democratic government, the U.S. Congress, was able to sit still long enough to ban hedge funds from doing exactly what Core Development Group is doing in Canada.
I wonder if Core is the only one? Realtor companies that guarantee to sell your home, or purchase it themselves, artificially drive up the price of resale housing. Airbnb, VRBO — anecdotally I believe we can all identify homes that have been converted to short-term rental and are no longer being lived in. No business licence, rezoning, enhanced fire suppression system, or additional insurance required.
REITS continue to take a larger share of Canadian renter’s savings. In Canada, it is estimated that it takes 6 1⁄2 years to save up for a down payment. That stretches out to 26 1⁄2 years for Toronto.
Corporations, investors, and other non-traditional entities have been manipulating housing prices as though it were their private stock market. Time for the government to fix the demand side of housing and its effect on prices.