Forgive me, I rarely do this, but I'm about to rant...
The Ontario Government is expected to release their plans to cool the housing market shortly, and there has been quite a bit of speculation as to what these plans might look like. Today CTV News published an article that highlights 5 of the most likely changes that we may see coming from the Ontario Liberals. All of these proposed changes have one thing in common. Rather, one word in common. TAX!
The big question here is, why? Why do we need to cool the housing market? Yes, this market has become very difficult for first time home buyers, but shouldn't the market be allowed to do what the market always does? For centuries, markets have gone up and down, and have corrected themselves. Thousands of Ontario homeowners have been able to use this hot market to improve their financial future and move into their dream homes, why do we have to stop that?
The fact that I see no compelling reason why we HAVE to slow down the real estate market, combined with the Ontario Government's dreadful track record for botching almost everything they touch leads me to believe that these proposed changes are a bad idea!
The reality is, just like the Mafia, the government just wants their cut. They have been sitting back for years, accumulating massive amounts of debt while watching a huge chunk of their citizens prosper and it's time for them to cash in!
A lot of people have a fear that things are getting too good, too quickly and that we're in for a crash similar to the 2008 crash in the United States. The truth is that what caused the crash in 2008 has almost nothing to do with why our market is so hot!
In my opinion, as long as the proper systems have been put in place to ensure that there is no mortgage fraud and that people are not over-leveraging themselves (both of these systems are in place) there is no further need for the government to get involved!
What would I do if I were in charge?
I think that municipalities need to relax some of their zonings restrictions and encourage investors to retrofit properties to become multi-family homes.