“These gigantic projects which, each round, keep getting bigger and bigger, are suggesting that we’re moving to a very different kind of city than we’re used to … and we’re not making the investments in the type of infrastructure that makes those cities work.”
Evidence of existing lack of infrastructure even with the present downtown Toronto development:
Any parents with children living in the new Toronto condos have been told to look further afield as the local schools cannot accomodate them
The Head of Emergency Services at St. Michaels Hospital a downtown teaching hospital says that emergency caseloads have doubled as a result of the explosion in condo. development, to the point that their resources are straining at the seams.
When are city planners going to start saying 'no' to developers to allow the required infrastructure to catch up?
" A verbal contract isn't worth the paper it is written on " Samuel Goldwyn
"The light at the end of the tunnel may be a freight train coming your way" Metallica - No Leaf Clover
The funding for needed transit expansion (estimated in the billions) and repair/replacement of the Gardiner Expressway (exclusive of the needs of schools and hospitals) cannot be provided from development levies on units.
Without provincial and federal funding what is the answer? Just to ignore it and build anyway?
" A verbal contract isn't worth the paper it is written on " Samuel Goldwyn
"The light at the end of the tunnel may be a freight train coming your way" Metallica - No Leaf Clover
CROCKD wrote:The funding for needed transit expansion (estimated in the billions) and repair/replacement of the Gardiner Expressway (exclusive of the needs of schools and hospitals) cannot be provided from development levies on units.
Without provincial and federal funding what is the answer? Just to ignore it and build anyway?
It is unfortunately ignored much of the time. If municipal governments allow developments to proceed, then they have to be prepared to spend the money on all needed infrastructure, through increased municipal taxes if necessary. Don't blame provincial and federal gov'ts with poor municipal decision making.
Assessments in Calgary are up for 2012, ca. 3% for typical single family houses, larger jumps for areas that just got access to LRT stations and some other niche segments. Still down in nominal terms compared to 2007, way down in real terms, of the order of 10-15%. Bit of a roller coaster.
AltaRed wrote:Don't blame provincial and federal gov'ts with poor municipal decision making.
That's the key point is it not? Municipal government should not allow mega downtown developments to proceed without adequate infrastructure funding in place.
And whenever developers do not like the answer they get from city government they invariably appeal to the Ontario Municipal Board, a
tribunal governed by the Ontario Municipal Board Act which reports to the Ministry of the Attorney General (Provincial) and which invariably gives them what they want.
" A verbal contract isn't worth the paper it is written on " Samuel Goldwyn
"The light at the end of the tunnel may be a freight train coming your way" Metallica - No Leaf Clover
I don't know anything about how Ontario works or the Ontario Municipal Board, but development does not happen in Calgary if City Council did not approve it in a public hearing, under the auspices of the Land Use Bylaw (zoning). For example, development of suburbs south of Fish Creek Provincial Park was frozen for years until a second bridge was built across Fish Creek, and until LRT was extended to the south. I don't believe developers had any recourse to other mechanisms, which probably means the Alberta Municipal Act had teeth. In that case, Calgary city council does control its destiny and thus accountability for overburdening infrastructure (which is overburdened especially in the burbs and transportation routes to downtown).
A little off topic, but relevant, was (as a deficiency) the dismantlement of Regional Planning Commissions back in the '90s which allows counties surrounding Calgary to approve developments along the borders of Calgary without Calgary being able to anything about it except appeal to the courts. There is a lot of that now happening which causes the tax base to be outside city limits while at the same time taking advantage of and straining the infrastructure in Calgary itself.
CROCKD wrote:The funding for needed transit expansion (estimated in the billions) and repair/replacement of the Gardiner Expressway (exclusive of the needs of schools and hospitals) cannot be provided from development levies on units.
I'm puzzled by this given the context of a proposed development at King and Yonge. How much possible incremental pressure could residents living at the Centre of the Universe® put on transit or the Gardiner, or for that matter schools? And if there is such pressure, which I will not admit without evidence, surely the correct solution is for the city to raise development charges to reflect costs appropriately.
Nothing can protect people who want to buy the Brooklyn Bridge.
CROCKD wrote:The funding for needed transit expansion (estimated in the billions) and repair/replacement of the Gardiner Expressway (exclusive of the needs of schools and hospitals) cannot be provided from development levies on units.
I'm puzzled by this given the context of a proposed development at King and Yonge. How much possible incremental pressure could residents living at the Centre of the Universe® put on transit or the Gardiner, or for that matter schools? And if there is such pressure, which I will not admit without evidence, surely the correct solution is for the city to raise development charges to reflect costs appropriately.
I believe the largest single contributors to political campaigns at the municipal level are developers and industries associated with the develpoment industry. The best government money can buy.
I think the biggest problem is that the direct beneficiaries of new transportation development do not contribute their proportional share.
When we moved to Toronto from Edmonton in 1981, we purchased in Unionville. Within 10 years it had overtaken Oakville in property values and average earnings. Sure the taxes went up, but our property increased by 3x during that period, thanks to highway 404 and the GO train.
There are similar stories in Vancouver by the construction of new Skytrain links (although they get masked by the overall bubble).
" A verbal contract isn't worth the paper it is written on " Samuel Goldwyn
"The light at the end of the tunnel may be a freight train coming your way" Metallica - No Leaf Clover
The Atlantic (finally someone in the U.S. noticed us )
Canada has a new worthwhile initiative. After years of booming prices, that bastion of politeness north of the border is looking to avoid a catastrophic housing bust for something more, well, boring. Initiatives don't get more worthwhile, and perhaps not more difficult considering Canada just might have the biggest housing bubble in the world right now.
<snip>
But by keeping rates where they are and slowly tightening mortgage requirements, Canada hopes to engineer a more gradual price decline that won't set off a vicious circle. In the best case, prices wouldn't fall, except below the rate of inflation, so that real prices decline without hitting household net worths. This strategy is hardly unique -- China has done the same the past few years -- but it has the very Canadian name of "macroprudential regulation".
CROCKD wrote:The funding for needed transit expansion (estimated in the billions) and repair/replacement of the Gardiner Expressway (exclusive of the needs of schools and hospitals) cannot be provided from development levies on units.
I'm puzzled by this given the context of a proposed development at King and Yonge. How much possible incremental pressure could residents living at the Centre of the Universe® put on transit or the Gardiner, or for that matter schools? And if there is such pressure, which I will not admit without evidence, surely the correct solution is for the city to raise development charges to reflect costs appropriately.
Typically, Toronto, unlike the rest of the GTA, does not levy high development charges. Here's a first read-through (look for the chart).
Found this on Yahoo. Its in the New York Market and its a housing bust in that the Wall street crowd that used to buy these properties are now being replaced with Foreign buyers.
$95 million dollar suite with $60,000 monthly fees!
Unlike in other countries such as the United States and Australia, neither the Canadian federal government nor industry keeps track of the numbers of foreign buyers or where they come from.
Australia, for its part, tightened its rules in 2010 to ensure that investment in its market by foreign non-residents “doesn’t place pressure on housing availability for Australians.”
" A verbal contract isn't worth the paper it is written on " Samuel Goldwyn
"The light at the end of the tunnel may be a freight train coming your way" Metallica - No Leaf Clover
Global house prices
Home truths
Our latest round-up shows that many housing markets are still in the dumps
The Economist, Jan 12th 2013
"Overvaluation is especially marked in Canada, particularly with respect to rents (78%) but also in relation to income (34%). Mark Carney, the country’s central-bank governor, who is soon to jump ship to join the Bank of England, where he takes over from Sir Mervyn King in July, may have shown good market timing with his move to London as well as a deft hand in negotiating his lavish remuneration. Singapore and Hong Kong also look vulnerable to a correction, given the overvaluation on their price-to-rents ratios."
I am appealing my assessment. The 2013 assessed value is slightly higher ($3000) than the 2012 assessed value. The average assessed value for residential properties in this jurisdiction is down about 5%, so if my assessment doesn't change, I will be paying more tax.
Last summer (close to the July 1 valuation date), there were several sales in my neighbourhood that were all below the 2012 assessed value. I spoke to a BC Assessment appraiser who told me that everything was within 10% so she felt that was good enough. I said if the assessments were 10% less than the sales, I wouldn't be complaining! She pointed out a sale about 5 Km away where the house sold for more than assessed value. I told her that I don't consider that my neighbourhood. The ones I looked at were at most 1/2 km away - one was across the street.
Daniel Indiviglio wrote:look at the thick black line. Once home prices fully fall from the bubble's pop, they will return back to the zero trend. In other words, home prices merely kept up with inflation over the past 120 years.
It's also worth noting on this chart just how ridiculous the housing bubble looks in a historical context. Check out the peak on the thick black line towards the right. There was nothing ever close to that sort of gain in real prices throughout history. And regulators didn't see the collapse coming?
What does history teach us? Buying a home isn't a particularly good investment, unless you just hope to keep up with inflation. But outside a bubble, its value should keep up with the prevailing price level fairly well. There is financial value in buying a home, of course. It can same you money from paying rent instead, as you accumulate equity and eventually pay it off. But don't expect its price to appreciate wildly. History shows pretty clearly that real prices won't increase much more than inflation in the long-term.
And, of course, you have to maintain that house in the interim.
Just for once, maybe "bubbleCanNeverExist" fellow member can enlighten us how this time it's different (I know he's almost always ignoring any dialogue requests, but some faint hope still exists).
finiki, the Canadian financial wiki
“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]