Further to my recent post on the last Monetary Policy Report http://www.progressive-economics.ca/2010/05/11/the-bank-of-canada-and-the-recovery/ I cannot claim to be surprised that the the Bank of Canada has decided to begin to raise interest rates, albeit by an initial quarter point from extraordinarily low levels. They are also returning to normal overnight money market operations which will tighten credit to a degree. I […]
Read moreI recently wrote a paper on the recession’s impact on homelessness, looking at Toronto as a case study. I presented it on Friday at the Annual Conference of the Canadian Economics Association (May 28-30, Quebec City). The paper’s title is “Calm Before the Storm,” as I believe that, based on the outcome of the last major recession in the early […]
Read moreSome puzzling comments in today’s Globe story casting cold water on the notion that there is a housing bubble. The story makes the classic anti bubble argument that national averages conceal a lot of local variation, reflecting local conditions. http://www.theglobeandmail.com/report-on-business/economy/the-home-price-puzzle/article1475073/ “Toronto-Dominion Bank economist Pascal Gauthier says the diverse nature of Canada’s real estate market means a U.S.-style bubble is not […]
Read moreIt is striking that, even while moved to concern and some action, the Bank of Canada and the Minister of Finance are still desperately afraid to admit that Canada is experiencing a housing bubble. One can go on and on about how difficult it is to spot a bubble. But, as Dean Baker has often argued with reference to the […]
Read moreThis morning federal finance minister Flaherty announced a number of measures ostensibly aimed at reining in speculation in the housing market. His announcement was typically well-timed to coincide with the Vanier Institute’s annual report on the state of Canadian family finances, which reports record high levels of household debt, growing inequality and housing prices increasingly out of whack with incomes. But […]
Read moreA new study published today by the Frontier Institute for Public Policy finds that Vancouver has the most unaffordable urban housing market not just in Canada, but in all of Australia, Ireland, New Zealand, the United Kingdom and the United States. This conclusion is based on a very simple, yet effective measure of housing affordability: the ratio of median housing […]
Read moreIn October, Canada’s inflation-adjusted Gross Domestic Product (GDP) expanded by 0.16%, which rounds up to 0.2%. While a second consecutive month of growth is unambiguously good news, we should be concerned about the amount and type of growth. Amount of Growth Real GDP (in chained 2002 dollars) dropped from a peak of $1,241 billion in July 2008 to a trough […]
Read moreLast week, the City of Vancouver’s task force, the Greenest City Action Team, issued a plan for the city with short and longer-term goals and policy advice on achieving them. The report covers more than climate change, a good thing as it is important to identify win-wins that lead to improvement on other environmental, health and social objectives as we […]
Read moreThe Canadian media didn’t pay much attention to this economic crisis before the stock markets plunged last fall, and that has continued to be a major focus. But this focus on the stockmarket and the mistaken perception that this crisis is all the fault of the U.S., is leading to the overly optimistic forecasts of recovery. There’s been very little attention […]
Read moreHousing has been one of the major drivers of the BC economy in recent years. Low interest rates led to rising home prices and a psychology of “must get in before being locked out forever”; leading a housing bubble that had everyone in town swapping jaw dropping stories of bidding wars and outrageous prices paid. The economic driver was not […]
Read moreDeclan picks up on Stephen’s suggestion that economists were too diffident to raise concerns about the real estate bubble: How to square the group of economists in the front pages of the paper offering a series of right wing prescriptions supported by neither fact nor theory with the economist unwilling to point out a housing bubble because it doesn’t fit […]
Read moreThe Progressive Economics Forum’s open letter is now making the rounds. Signatories include four chairs of economics departments, two former Presidents of the Canadian Economics Association, a former federal Secretary of State (Finance), and a former Quebec Minister of Industry. Here’s the text and the 88 signatories: Open Letter from Canadian Economists on the Current Economic Crisis and the Appropriate […]
Read moreI’m pleased to see the federal government are taking action to modestly reign in the wilder excesses of the Canadian mortgage lending industry. They propose to insure only loans with a 5% downpayment and 35 year or less amortization period – compared to tnhe status quo which permits insurance of no down payment 40 year loans. My recollection is that […]
Read more… is people like me, who have made spectacular capital gains as home owners. Through the dumb luck of having bought real estate at the right time, before the current boom, my family has reaped a windfall profit that only an oil executive could sneer at. It is not particularly accessible. We need to live somewhere and could only really […]
Read moreThe Wellesley Institute blasts the federal Liberals on housing: Earlier today, the Liberal Urban Communities Caucus released a powerful report condemning the Conservative government of Stephen Harper, and calling for strong action. Eighteen years ago, almost to the day, the National Liberal Caucus Task Force on Housing released a powerful report that condemned the Conservative government of Brian Mulroney, and […]
Read more … is homes. Check out this astonishing admission, as reported by CBC: St. Paul’s in downtown Vancouver, one out of every four beds is being used to treat the homeless, drug addicts and the mentally ill, said [Lorna Howes, the director of acute and community mental health for Vancouver with the Vancouver Coastal Health authority]. We are spending money on […]
Read moreFor the first time in years, I forked out a toonie to buy the Vancouver Sun this past Saturday. It must have been a guest editor for Easter or something because the banner headline screamed: The Cost of Homelessness: BC spends $644 million a year on services for those on the street. A study says the same amount would buy […]
Read morehttp://www03.cmhc-schl.gc.ca/b2c/catalog/z_getpdf.jsp?pdfkey=2913653764704560038976021471679303982482875120909016402/65901.pdf CMHC have published a joint study with StatsCan on the dynamics of housing affordability, 2002 to 2004. Affordable housing is defined as paying more than 30% of household pre tax income on shelter costs. Annually published cross sectional estimates show that about 20% of Canadians were paying too much for housing in any given year over this period. This […]
Read moreFrom PEF member Nick Falvo, from today’s Toronto Star: City has a useful plan but still needs funding TheStar.com – comment – City has a useful plan but still needs funding January 15, 2008 Nick Falvo Over the past decade, media attention surrounding homelessness has been widespread, prompting Canadians to become increasingly concerned about a mounting social crisis. Shelter usage […]
Read moreThe current issue of Maclean’s features a typically provocative cover on “Real Estate 2008.” The “Buy? Sell? Panic?” headline caught my attention because I am currently selling a place in Ottawa and moving to Toronto. The story inside Maclean’s is far more soothing, suggesting that there is no risk of a real estate crash in major Canadian cities because: sub-prime […]
Read moreMy office window looks out over Vancouver’s Downtown Eastside, an area notorious for being Canada’s poorest postal code. Back when Vancouver was awarded the 2010 Olympics, we pointed out that the world’s media would be stationed just ten minutes walk away from truly abject poverty, and when the cameras started rolling, it may not be gorgeous mountain backdrops they would […]
Read moreGiven the odd rumbling in Ottawa that the feds might make mortgage interest deductible from income tax, this article from the New York Times provides some interesting background on the origins of this deduction in the US, the impacts it has had, and the current state of play. The full article is rather lengthy; this excerpt captures some of the […]
Read moreIf our governments cannot get their heads out of the sand and start building some housing for those who desperately need it, we can expect more negative images of BC and Vancouver. As captured by The Washington Post: When the Winter Olympics open in Vancouver, visitors will find one of the most alluring cities in North America, a green and […]
Read moreThe August issue of the Journal of Primary Prevention is dedicated to articles on homelessness, addictions and mental illness. It has a US focus but many of the problems will be familiar to Canadians, too. A guest editorial (pdf) kicks off the issue by scoping out the problem, with a good summary of studies on the hidden financial costs to […]
Read moreare high, according to a new report, summarized by Gordon Laird in the Toronto Star: According to a new report from the Sheldon Chumir Foundation for Ethics in Leadership, Shelter: Homelessness in a Growth Economy, homelessness is costing Canadian taxpayers $4.5 billion to $6 billion a year. Canada in 2007 collectively spends more managing homelessness than it spends on international […]
Read moreOver at MaxSpeak, the state of housing and whether or not it is a bubble is reviewed: THE GREAT HOUSING BUBBLE FLAP Probably most who read this blog accept that there was a bubble in the US housing market, and that it has come to an end. Some regulars here, notably the notable Dean Baker, were early out the door […]
Read morehttp://www.businessweek.com/magazine/content/07_12/b4026050.htm A rather moving story from Business Week about the real victims of the crisis of the US subprime mortage market – the borrowers. The late stages of the US housing bubble were sustained by a flood of new buyers – lower income households tempted to get into the housing market by superficially low interest rate mortgages for which they […]
Read moreThe story below was the banner headline piece on page one of today’s Vancouver Sun, and is a perfect choice for the “we told you so” file. Three years ago, after being awarded the 2010 Olympics, our BC Solutions Budget (and in subsequent editions) made many of the same points as the Olympics Housing Roundtable’s soon-to-be-released report. This report, and […]
Read moreBC Budget 2007 is a “housing budget†that does not build much housing. The budget commits to a mere 250 new social housing units over two years – a far cry from the 2,000 per year that was built back when the federal and provincial governments were in the game (before 1993). At this pace, it will take 17 years […]
Read moreLast Fall, in my capacity as a member of the Vancouver City Planning Commission, I helped organize a conference on affordable housing from a longer-term urban planning perspective. The final report is now available here. It features a summary of what happened at the conference, written by yours truly, but also contains lots of great visuals that were developed and […]
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