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Jailhouse Rock

Market Updates | October 2, 2019

On October 21, 1957, Elvis Presley released the billboard hit, “Jailhouse Rock.” Here are the world-famous lyrics from Elvis’ song:

Let’s rock everybody, let’s rock
Everybody in the whole cell block
Was dancin’ to the Jailhouse Rock

Fast forward to 62 years later, October 21, 2019 will be the voting day for the Canadian Federal election. Which party will be singing Elvis’ “Jailhouse Rock” late into the night on the 21st? One party will be in full celebration mode, while the others will be wishing they had strategized better. With my song choice of “Jailhouse Rock,” am I insinuating that the House of Commons is filled with a bunch of crooks? Election campaigns bring out the worst in the party and the party leaders. They paint each other as crooks, liars, and thieves, and in some cases, there is truth to what is being shared, leaked, and printed by the media.  

I do not need—nor do I want—to bring up the headlines and accusations that have circulated throughout the campaign; instead, I want to focus in on what the leaders are promising around housing issues. Affordability has been the buzzword of the past decade when it comes to housing. Politicians at every level of government constantly discuss, debate, and tell us that they are solving the housing affordability issue. Frankly, the word is overused and the politicians’ promises and policies on affordability are hollow, empty, and pie in the sky ideas. They look great on paper, make a nice headline, and give the politician a glowing press conference.     

Here are a few of the latest affordable housing policies as we approach Election Day from the different parties. Maxime Bernier of the People Party says he will make housing more affordable by restricting immigration, ending supply management, and lowering taxes. Andrew Sheer of the Conservative Party promises that if elected, his government will adjust the mortgage stress test to get most first-time buyers into the market. He states that a Conservative government will allow more federal land to be used to increase the housing supply. Sheer will also reintroduce 30-year terms to Canada Mortgage and Housing Corporation (CMHC) insured mortgages. Interesting fact: former Conservative Prime Minister Stephen Harper initially raised the CMHC’s mortgage amortization period to 40-years in 2006 before shortening it to 35-years in 2008, reducing it again to 30-years in 2011, and returning it to 25-years in 2012. NDP leader, Jagmeet Singh, promises to help build 500,000 affordable housing units in 10 years and waive the federal portion of the GST/HST in construction projects of new affordable rental units, as well as double the Home Buyer’s Tax Credit available to first-time homebuyers to $1,500. The NDP will also immediately invest $5 billion in new affordable housing. Meanwhile, the Liberals say that they will expand the first-time homebuyer initiative to cover homes of up to $789,000 in the priciest areas of the country. The Liberals also say that they will create a national speculation and vacancy tax of one percent against properties owned by non-Canadians who do not live in Canada.

But how much of this will actually happen? The government never gets it right… There is so much talk about the right of home ownership, affordable rentals, affordable rent, and rent control. I believe that the government is far too involved in the arena of housing. They need to get out of the way of developers, real estate investors, and eliminate red tape and regulations at all levels of government. It simply comes down to supply and demand. The regulations, policies, red tape, taxation, permitting process, and poor budgeting is the cause of the shortage of housing which ultimately causes it to be unaffordable. 

I remember a time when a single-family home in Abbotsford would be built in three months. Today, that same house will take six or more months to construct. Why is that? Regulations, policies, red tape, taxation, and permit process. Are homes being built with more quality and care, and in turn, safer? You could debate that they are built more luxuriously, but are they a safer home? I do not think they are any safer, but I am not a home/building inspector. The point is, regulations, policies, red tape, taxation, permitting process, and poor budgeting cause the system to crawl, therefore, resulting in housing shortages. Shortages cause rent, housing prices, and even building costs to rise, resulting in the end users, tenants, and homeowners paying significantly more than they should. 

The Party that has a housing and development platform that rids of over-regulating, eliminates red tape in development and re-zoning, reduces and eliminates much of the taxation around creating new housing, streamlines the permitting process, and shows fiscal responsibility has my vote on October 21, 2019. Who has your vote?

Please reach out to our team for more information or help with all your real estate needs.

Click Below To See The Fraser Valley Stats For February:

Fraser Valley STR Stats

STR (Sell Through Rate) Formula = Sales ÷ Active Listings + Failed Listings + Sales

 

Randy Dyck
Personal Real Estate Corporation
604-807-4366 or randy@eximus.com