We all know that immigration needs sensible reforms. And we all know that there is a housing crises. The question is whether immigration “created the housing crises”. But the cost of housing has outpaced incomes globally. If it were just created by immigration, then shouldn’t the prices balance out globally as countries that lose population get more housing availability?
Surely the pressure from immigration aggravated the housing crises, but it did not create it. The crises has been building for at least 50 years. It is created by the financialization of housing and the withdraw of public investment in affordable housing.
Housing is a human right, because it is a basic necessity for living a decent and secure life. When you let core needs be met entirely by the market, without any social support to guarantee access, the profit motive will inevitably squeeze the population to extract more and more upside.
In any market, maximum profits can be made when there is high demand with a restricted supply. By surrendering housing entirely to increasingly unregulated markets, the production of housing becomes prioritized based on return on investment, and that means in order to attract capital housing production and sales have to be more profitable (for some segment of available investment) than other investments, such as mining, oil, finance, etc. If not, any capital would just flow to those more profitable avenues. As a result, we get luxury housing when we need affordable housing and we get unproductive sprawling, overly large single family homes when we need medium density housing near urban centers.
So then, is it any surprise that think tanks and corporate interests that want to drive forward market deregulation to maximize profit potentials will try to tell us to blame immigration for “creating” the crises that is actually due to the very deregulation they want to advance?
Caveat Emptor:
Tornto Sun is US owned by Post Media which is 66% owned by Chatham Asset Management, a hedge fund with close ties the Republican party and which contributed to Trump’s takeover in the US. Post Media has an explicit rightwing political agenda.
The source of the report, is the Fraser Institute, a “libertarian-conservative” think tank dedicated to market deregulation (so called “free markets”).The Fraser Institute receives millions in foreign funding including notable US sources. The institute does not disclose their funders, but we know that they are at least partially funded by the U.S. Koch brothers, who were primary instigators of the corruption that is eating the US alive.
I agree that much of the problem is low interest rates, due to China now manufacturing our goods; coupled with the US removing shelter from their CPI in the late 80s, which made borrowing cheaper globally.
To prevent deflation they let people take on huge amounts of mortgage debt, which increased the money supply and raises aggregate demand to hit a 2% inflation target. Which we see as high house prices.
Though I have to laugh when you say housing is unregulated, we have some of the highest developer fees, slowest approvals, most sprawled zoning regulation. If we want population growth without wiping out greenbelt you need to fix those first. You can usually only build a single family home, and land values/taxes make up the large bulk of the price.
We all know that immigration needs sensible reforms. And we all know that there is a housing crises. The question is whether immigration “created the housing crises”. But the cost of housing has outpaced incomes globally. If it were just created by immigration, then shouldn’t the prices balance out globally as countries that lose population get more housing availability?
Surely the pressure from immigration aggravated the housing crises, but it did not create it. The crises has been building for at least 50 years. It is created by the financialization of housing and the withdraw of public investment in affordable housing.
Housing is a human right, because it is a basic necessity for living a decent and secure life. When you let core needs be met entirely by the market, without any social support to guarantee access, the profit motive will inevitably squeeze the population to extract more and more upside.
In any market, maximum profits can be made when there is high demand with a restricted supply. By surrendering housing entirely to increasingly unregulated markets, the production of housing becomes prioritized based on return on investment, and that means in order to attract capital housing production and sales have to be more profitable (for some segment of available investment) than other investments, such as mining, oil, finance, etc. If not, any capital would just flow to those more profitable avenues. As a result, we get luxury housing when we need affordable housing and we get unproductive sprawling, overly large single family homes when we need medium density housing near urban centers.
So then, is it any surprise that think tanks and corporate interests that want to drive forward market deregulation to maximize profit potentials will try to tell us to blame immigration for “creating” the crises that is actually due to the very deregulation they want to advance?
Caveat Emptor:
I agree that much of the problem is low interest rates, due to China now manufacturing our goods; coupled with the US removing shelter from their CPI in the late 80s, which made borrowing cheaper globally.
To prevent deflation they let people take on huge amounts of mortgage debt, which increased the money supply and raises aggregate demand to hit a 2% inflation target. Which we see as high house prices.
Though I have to laugh when you say housing is unregulated, we have some of the highest developer fees, slowest approvals, most sprawled zoning regulation. If we want population growth without wiping out greenbelt you need to fix those first. You can usually only build a single family home, and land values/taxes make up the large bulk of the price.