There was an article in the Globe and Mail stating the obvious...that local incomes can in no way support our prices. In the comments section people have stated the second obvious point, that Mainland Chinese money coming here has distorted things.
Of course they could have also mentioned the two pillars of our under-ground, untaxed economy....drugs and construction.
Others have reacted to this anti-outside-investor mood and even arranged a talk tomorrow to address this.
Here's my two cents:
IT IS NOT ABOUT RACE.
Canadian is not a Race. It is a collection of races. The first people on this land were brown-skinned, then came whites and then yellows and then more brown, and they are all co-existing and mixing very nicely (after some early hiccups!)
To be Canadian is not have blue eyes or to be able to speak Salish, it is to have a commitment to this country.
That means an understanding that your responsibilities and obligations to this society should be at least as much as your expectations and entitlements. Many who have been born here forget that.
However when we allow someone to bring big wads of un-taxed money here to buy an investment or financial sanctuary, we are doing several things:
1) We are helping force the locals, who are working and paying taxes, and running this society into either a precarious housing situation or a precarious financial situation to obtain secure housing.
The truth is that taxed money can never compete with untaxed and often corruptly obtain money. That money can come from anywhere. It has no racial ties. It can come from South America, China, the Middle East , Russia or India. ie it can accompany any race. All it does is cause a temporary rise in Realtors and Mercedes car salespeople commissions and bring in a chunk of property transfer tax, which is why Governments can never say 'enough'.
2) The result is that the local, taxed population who may be of Chinese or Indian or European extraction are putting themselves in deeper debt to compete with this hot money. This leads to increased risk for lenders, which in Canada the banking cartel has nicely downloaded onto the CMHC. The denouement of this could be very painful.
As you can see it not racial at all. IMVHO Conrad Black, who turned his back on Canada and is a convicted criminal, should never have been allowed back into Canada. Why this government decided they had to, remains a mystery to most of us.
3) Also by allowing huge chunks of capital to escape China, for example, and come here we are not only doing ourselves a dis-service, but the 1 Billion Chinese who still live on about a dollar a day.
We are not playing on a level field, we have properties left empty for investment purposes, we have the CMHC pushed to the edge by the bubble, and yet I doubt if there is anything that anyone will do about it. By the time our politicians hear the clamour over the calls of the special interest groups, it will be too late.
I want to end this post by saying once again, this off-shore buying is just ONE of the reasons for our bubble. Thank Flaherty for the CMHC monster. Thank Carney for 1% interest rates. It needed all three of these components to have the lunacy we have now.
There is much blame to go around.