Why upcoming housing affordability measures may be limited in what they can do
Amid growing fears of a housing bubble in Canada’s largest city, Ontario Finance Minister Charles Sousa is reportedly close to unveiling new measures to improve housing affordability. But one Bay Street money manager is skeptical about how much Queen’s Park will be able to cool the market in Toronto.
"Mark my words - government will not fix this issue,” said Kash Pashootan, senior vice president and portfolio manager at First Avenue Advisory, Raymond James, in an interview with BNN.
“Unless you’re going to build land that doesn’t exist, you’re not going to fix the supply issue,” he said Wednesday.
He added that it may be unrealistic for all residents to expect to be able to afford living in Toronto’s downtown core, given Toronto’s rapid growth and growing status as a world-class city.
Sousa’s suite of new housing measures could be announced as early as Thursday, according to a report from the Toronto Star. The measures are expected to include rent control, a levy on housing speculators -- including foreign speculators. A spokesperson for the Ontario finance ministry declined to comment on the Star’s report.
Sousa met with federal Finance Minister Bill Morneau and Toronto Mayor John Tory on Tuesday afternoon to discuss housing in the Greater Toronto Area. The meeting was the first of planned quarterly meetings on the issue, a sign that the three levels of government are pushing for a coordinated response.
Sousa stated that his province’s measures wouldn’t have “unintended consequences” on the value of family homes.
Pashootan argues policymakers shouldn’t wait until they have a perfect strategy to take action.
“Part of the frustration is that time and time again, we hear from government that they don't have enough data, and that seems to be the scapegoat to not doing anything.”
“The reality of it is, we're never going to have enough data. We live in a world where we make decisions on everything with limited data… It’s about just making some progress.”