Here is a worth while read for those interested care of the Toronto Star. It doesn't connect rising and unaffordable housing prices with mass immigration - it is the Toronto Star after all - but that's why I am here.
Canada losing the housing dream
Feb 14, 2008 04:30 AM
Canadians have watched with fear and amazement as the subprime housing crisis has razed assets and crushed dreams across the United States. Yet sketchy loans and predatory mortgage dealers are only part of the American picture.
While subprime financing is foreign to Canada, much else is common: long-term erosion of housing affordability, an unprecedented increase in housing-related debt, as well as income insecurity and underemployment. Across North America, many middle- and lower-income households are suffering.
And unlike the United States, where housing bargains abound, affordability for Canadian homebuyers is now the worst since 1990. According to January 2008 data from RBC Economics, there remains no major Canadian urban centre where average home ownership costs – mortgage payments, utilities and taxes combined – are less than 30 per cent of household income.
It's worthwhile to note that Canadian immigration numbers skyrocketed in the late 1980s due to the inept governance of the Brian Mulroney Conservatives. In one fell swoop the Mulroney Conservatives raised Canada's immigrant intake by 100,000 more burdening Canada to an immigration overload of 250,000 plus immigrants a year. Knowing this it should come as no surprise that housing prices in Canada have been at their worst since 1990.
In other words, much of Canada's population now faces housing markets that exceed the generally accepted definition of affordability. Some cities, such as Toronto and Vancouver, now require from 44 to 70 per cent of average household income, respectively, to own and maintain an average-priced house. It is no wonder, then, that total household debt in Canada has increased by almost 50 per cent in the last 15 years.
The sad truth is that many Canadians will never own their own home, let alone have the same choice and affordability in rental accommodation enjoyed by previous generations.[...]As affordability wanes across the country, homelessness continues to grow in many urban centres. From Toronto's suburbs to Canada's north, affordable rental accommodation remains tight and economic obstacles for Canada's housing-poor are considerable. As many as 250,000 Canadians are homeless on any given day.
Isn't it sad that Canada accepts over 250,000 immigrants a year (officially at least) yet a similar number of Canadians are homeless on any given day? Do you see now why I am an immigration reformer. Family first.
Here is a similar story from the Vancouver Sun. It focuses on the Vancouver housing market but the story should be familiar for most of Canada's urban centres especially Toronto.
Affordability continues to fall
Metro Vancouver housing becomes most unaffordable ever recorded in RBC surveys
Derrick Penner, Vancouver Sun
Published: Thursday, January 24, 2008
VANCOUVER - Metro Vancouver's housing, in the third quarter of 2007, became the most unaffordable it has been on RBC Financial's measure of affordability since the bank started tracking the issue.
RBC released its latest housing affordability index the day after a major report by the Federation of Canadian Municipalities warned that the unaffordability of housing is becoming an economic issue for Canadian cities, and Vancouver Mayor Sam Sullivan said too many families here are having to choose between buying food or making the mortgage.
By the bank's measure, it would take 75 per cent of Metro Vancouver's median income of $60,000 to afford an average two-storey home, which carried a $619,892 price tag.
Housing prices are similar in Toronto and the surrounding area and mass immigration is to blame. To show you how out of whack mass immigration is driving housing prices in Toronto consider the home bought by India's "Dr. Death" in the Springdale neighbourhood of Brampton; a neighbourhood that is on the very periphery of urban sprawl and plays host to a very large South Asian immigrant population. He bought a four bedroom two-storey home for $610,000. I have seen the neighbourhood many times and I can tell you no house in that neighbourhood is worth that amount. They later put the house up for sale for $635,000. Heavy South Asian immigration into that neighbourhood is creating artificial demand and pushing housing prices up in that neighbourhood, beyond what any average Canadian family can afford to say nothing of immigrant families. Similar patterns can be observed in Markham and Richmond Hill due to heavy and unwarranted Asian immigration.
It is also worthwhile to note that Toronto and Vancouver are prime destinations for most of Canada's immigrants. Should it be of any wonder that housing prices are their least affordable in these cities in almost 20 years? This is a tragedy for young Canadian families starting out and seeking to buy a home to house themselves and their children. This is another financial kick in the teeth for those born in the 1970s who not only had to endure a saturated labour market but now have to pay more for what previous generations paid less. And mass immigration has made is worse. This is an example of how Canada's immigration policy has failed Canadians. If anything can be said, it appears mass immigration is more of an assault on the quality of life for most Canadians than a compliment. Nobody cares about multiculturalism when you have mortgage payments due.
However some chicken littles are predicting a "correction" - a euphemism for crash - due anytime soon because home ownership is unafforable to the average Canadian putting them in record levels of debt (the home reno fad doesn't help either). You can read it here. If that happens then many who bought homes in the hyper-inflated market will lose a lot of their wealth literally overnight. The thing is housing prices wouldn't be as high were it not for mass immigration and becuase of mass immigration the housing market crash, if it comes, is going to be worse then it would have been.