Full Comment - The housing crisis is a sign of worse things to come

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00:01:11.520 You're richer than you think.

00:01:18.960 Housing.

00:01:19.680 It's an issue that's gone from something we rarely thought of, that we took for granted,

00:01:24.500 to being the hottest political issue of the day.

00:01:27.200 Elected officials at the federal, provincial, municipal levels are all talking about housing

00:01:31.620 and what we can do about prices, how we can build more homes to bring balance back to the market.

00:01:37.060 And the man they often seek out for advice on that issue is Ben Rabideau,

00:01:40.520 the focus of this week's edition of the Full Comment Podcast.

00:01:43.940 Hello and welcome to the Full Comment Podcast.

00:01:46.760 My name is Brian Lilly, your host.

00:01:48.160 And before we get to our guest, I want to remind you to please hit that subscribe button

00:01:52.820 on whatever app or device you're listening to us on and make sure you share this podcast

00:01:56.860 on social media because yes, you can still share podcasts on social media in Canada.

00:02:02.560 Now, Ben Rabideau has agreed to spend time with us over the next little bit to try and delve

00:02:06.240 deeper into the issue of housing.

00:02:08.080 Ben is an entrepreneur, a data guy, the founder of Edge Realty Analytics,

00:02:13.220 and someone that politicians of all stripes are regularly seeking out for advice.

00:02:17.300 Few people can say that both Justin Trudeau and Pierre Polyev have consulted them on an issue,

00:02:22.320 but that's because Ben looks at housing and what needs to be done from a data-driven

00:02:27.160 rather than a partisan lens.

00:02:29.680 Recently, he spoke to all parties at the Finance Committee of the House of Commons

00:02:33.500 on what needs to be done to solve the housing crisis.

00:02:37.080 And now, Ben is making time for us.

00:02:39.300 Ben, thanks for the time.

00:02:40.920 Thanks for your invitation, Brian.

00:02:41.900 Is it shocking to you that in a few short years we've gone from this being just an expectation

00:02:50.040 that we would all, you know, as I said, come out of school, save up some money,

00:02:55.160 buy a house, that this was normal, and we've gone from that being what we all expected

00:03:00.920 to people saying, I will never own a house.

00:03:04.580 It is just not feasible in my future.

00:03:08.120 How shocking is that to you?

00:03:10.320 Well, I guess as someone who kind of lives and breathes housing and has for the past decade,

00:03:15.420 it's, in my mind, it's been a slow burn.

00:03:18.000 So I know it's kind of leapt into the public consciousness really in the last couple of years,

00:03:21.900 particularly with the recent run-up in interest rates.

00:03:24.760 But it's been sort of a simmering crisis for quite a while, masked in part by the fact that

00:03:30.860 we had such exceptionally low rates for so long, but we could see this building imbalance

00:03:36.960 between supply and demand that was sort of simmering under the surface for years, really.

00:03:42.420 And then we saw the run-up in prices, and then it kind of catalyzed when we had this run-up

00:03:48.620 in interest rates that has really forced it.

00:03:50.960 But there's a second thing as well that I think is perhaps more pressing at the moment,

00:03:56.040 which is just the incredible disruption that we're seeing in the rental market.

00:04:00.320 And that, I think, is really perhaps the easier of the policy solutions to address,

00:04:06.120 because when you really start to dig into the root cause of that, it's really very simple.

00:04:11.840 We've had an explosion in the number of non-permanent residents in Canada,

00:04:17.040 which I know is something we want to talk about, the whole population dynamics,

00:04:20.960 but just to frame the issue, out of Ottawa, we have a federal target around permanent residency.

00:04:27.600 And so it's set at $465,000 for this year.

00:04:30.660 And I don't think anyone really has a fundamental issue with that particular target.

00:04:34.940 I think we all recognize we need strong immigration.

00:04:37.900 So we'll set that aside.

00:04:39.620 The Fed's target permanent residency.

00:04:41.500 But separate to that, we have non-permanent residents.

00:04:44.220 And these are primarily international students and temporary workers.

00:04:49.080 And those numbers have absolutely exploded.

00:04:51.320 We've added 700,000 in the past year.

00:04:54.680 It's accounted for, that cohort has accounted for 71% of population growth over the last two years.

00:05:00.180 And they're overwhelmingly renters.

00:05:01.800 And so you have to, it seems kind of common sense when you say it out loud.

00:05:06.880 But yeah, if you add 700,000 renters into the Canadian population in a year,

00:05:10.980 you're going to have enormous issues in the rental market.

00:05:14.220 And that's exactly what we're seeing.

00:05:17.080 I know that Mike Moffitt, who works in this field,

00:05:19.660 professor at Ivy School of Business at Western University of Western Ontario,

00:05:24.700 he's looked at this and he plotted out in a couple of charts

00:05:28.580 how the cities and towns with the highest concentration of foreign students being brought in

00:05:37.240 had the biggest rental crunch.

00:05:40.260 Is that your experience as well?

00:05:42.860 Yeah, the numbers are really clear.

00:05:44.120 You just can't get away from it.

00:05:45.240 I think this is such a simple, it's such a clear correlation here.

00:05:50.820 You just, you can't, you can't get away from it.

00:05:53.360 So 700,000 in a year, of course,

00:05:56.200 is going to have all sorts of externalities in the rental market.

00:05:58.580 And it's one of the kind of low-hanging policy discussions that we should be having, right?

00:06:06.540 It's something that can be addressed, you know, relatively cleanly.

00:06:12.100 So the numbers that just came out of Stats Canada yesterday

00:06:15.340 were that as of July 1st, 2023,

00:06:19.080 there were 2.2 million non-permanent residents in Canada.

00:06:24.420 That was a 46% increase from the year earlier.

00:06:29.700 As you say, if you just say non-permanent residents,

00:06:32.020 that's everyone from someone who gets a job,

00:06:36.580 is a migrant farm worker,

00:06:39.900 someone who gets a job coaching an NHL team that isn't a Canadian citizen,

00:06:43.820 anything like that.

00:06:44.620 They all qualify under that.

00:06:45.820 But the biggest concentration is the explosion in students.

00:06:53.480 It seemed to catch the government by surprise that the new minister was brought in,

00:06:58.660 and we'd been talking about 700,000 to 800,000.

00:07:00.840 And he said, no, we're going to have 900,000 this year.

00:07:04.340 I mean, that's a large city that you're just plopping down in the middle of the country

00:07:10.020 with no planning for how to deal with that population.

00:07:14.400 No forethought in terms of, okay, well, we can bring these students in,

00:07:18.940 and the schools can make a lot of money off of them

00:07:22.540 because they can charge extra tuition.

00:07:25.200 But no thought to what it would do to, you know,

00:07:29.260 will they have a place to live?

00:07:30.440 We've seen in North Bay some students living under a bridge in tents.

00:07:35.620 But, I mean, it seems like this was a policy decision

00:07:41.360 with no forethought of the consequences.

00:07:44.740 Well, I think that's exactly the issue.

00:07:46.480 It's not that we necessarily have a fundamental issue with that level of growth.

00:07:52.820 It's that you just can't drop that many people

00:07:56.620 without any forethought to how you're going to house them

00:07:59.740 and what sort of strain that might place on some of the social systems broadly.

00:08:04.860 And it's just flat out a policy failure.

00:08:08.460 Now, one of the things that gets tricky in all of this

00:08:11.720 and that I find kind of, I don't know, I guess offensive

00:08:16.660 is that you alluded to the fact that the post-secondary institutions

00:08:21.760 obviously welcome international students

00:08:24.000 because of the much higher tuitions, right?

00:08:25.840 Typically four to five times the Canadian students.

00:08:31.500 But what's interesting is I don't think people realize

00:08:34.560 that oftentimes colleges will partner with for-profit entities

00:08:39.580 to outsource the teaching to them.

00:08:42.200 And so, for example, we have colleges in Ontario

00:08:43.820 that have 80% of their enrollment are international students.

00:08:47.080 And those colleges partner with these for-profit entities

00:08:49.920 that handle the teaching.

00:08:51.240 They effectively are responsible for the recruiting internationally.

00:08:55.920 And so there's a profit motive.

00:08:57.940 It's like the school has franchised out their name.

00:09:00.640 That's exactly right.

00:09:01.700 And so we're effectively allowing for-profit entities

00:09:05.200 to outsource this.

00:09:07.720 And there's no caps from the government,

00:09:11.440 which to me, like the incentive is all wrong there.

00:09:14.220 If you're going to incentivize people to make this sort of money

00:09:17.720 by bringing students here and sort of gaming the system

00:09:21.140 with no responsibility to provide that housing,

00:09:24.980 like why wouldn't they?

00:09:25.960 It's free money, right?

00:09:27.160 And even more alarming than that,

00:09:28.740 that you might find interesting, Brian,

00:09:29.800 is I started doing some digging on this

00:09:31.180 because this is what I do.

00:09:32.260 And I pulled up the articles of incorporation

00:09:35.100 for just one of these companies.

00:09:36.400 The very first one I opened,

00:09:37.620 two of the three founders were from mainland China,

00:09:41.620 which I don't know what that means.

00:09:42.900 But I think as Canadians,

00:09:44.660 we should be somewhat alarmed

00:09:46.780 that we have for-profit entities

00:09:48.160 owned by non-Canadians

00:09:49.780 that are effectively selling citizenship

00:09:53.440 or fast-track citizenship in Canada

00:09:56.140 with no responsibility.

00:09:57.400 It's not a good look.

00:09:58.640 And we need to be looking more seriously at this.

00:10:00.880 Well, and for people that don't know,

00:10:02.300 part of the appeal,

00:10:04.300 part of the sales pitch

00:10:05.560 is go to school in Canada,

00:10:09.120 you get on the fast track for citizenship.

00:10:11.640 Because if you have foreign experience 1.00

00:10:13.580 or, sorry, Canadian experience

00:10:15.800 in working or in studying,

00:10:19.400 you get extra points for becoming a citizen.

00:10:22.260 And so that, you're right,

00:10:24.400 there is a sales pitch going on at all levels

00:10:27.060 and people are making a lot of money off of this,

00:10:29.280 but it's having a huge impact on the housing system.

00:10:32.780 Beyond everything else,

00:10:33.800 the housing system is out of whack.

00:10:35.520 And I live in a condo building

00:10:37.340 in the middle of downtown Toronto,

00:10:38.900 right by U of T.

00:10:40.100 let me tell you that the other day

00:10:42.400 probably passed 100 people on walk with my dog

00:10:46.580 and 80% of them were young Chinese students.

00:10:50.200 U of T is just one school of many

00:10:52.840 that rely on a large amount

00:10:55.440 of foreign students to come in

00:10:57.400 because they've got caps on tuition

00:11:02.360 imposed by the provincial government.

00:11:04.320 So you've got a whole mess of policies

00:11:06.820 from both the federal government

00:11:08.240 and the provincial government.

00:11:09.740 And the end result is

00:11:11.320 a one-bedroom condo near me

00:11:14.040 now costs about $3,000 a month to rent.

00:11:17.260 Right.

00:11:17.800 And it also incentivizes speculation

00:11:20.080 in the single family market, right?

00:11:21.660 So one of the things that we're seeing

00:11:22.740 is the economics of rentals.

00:11:25.320 If you were to buy a single family home

00:11:26.900 in Toronto and try to rent it to one family,

00:11:29.060 you're never going to make those numbers work.

00:11:30.860 You'll just be deeply cashflow negative.

00:11:32.460 But if you can instead put 10 or 12

00:11:35.380 international students in there

00:11:37.020 and charge them each 500 bucks,

00:11:38.960 well, now all of a sudden

00:11:39.580 you have an investment case.

00:11:41.140 And we're absolutely seeing that dynamic

00:11:43.320 where because there's such a shortage

00:11:45.480 of places to live

00:11:46.360 and because we've seen such an explosion

00:11:48.700 in international students,

00:11:50.340 people are figuring out

00:11:51.120 we can buy single family homes,

00:11:53.240 remove those off the market.

00:11:54.340 They enter this kind of rental pool,

00:11:56.700 jam them full of international students.

00:11:58.360 And I want to be really clear,

00:12:00.500 the international students themselves

00:12:02.140 have been sold a false bill of goods here, right?

00:12:04.400 They've been taken care of.

00:12:05.240 I'm in no way suggesting

00:12:07.260 that they themselves are the problem.

00:12:09.320 It's that we're allowing the recruiting,

00:12:11.660 we're allowing the misrepresentation

00:12:13.280 of the system internationally.

00:12:16.120 And that's fundamentally the problem.

00:12:17.620 And you're right,

00:12:18.000 it's a problem at both the provincial

00:12:19.420 and the federal level.

00:12:20.200 There's multiple players involved

00:12:22.020 that need to get together

00:12:22.840 and figure this out.

00:12:23.500 So before we start talking about

00:12:25.620 trying to bring some sanity

00:12:30.160 back to the housing market

00:12:33.020 in terms of people purchasing a home,

00:12:34.680 buying that first home,

00:12:35.740 getting into the market,

00:12:37.520 I want to ask you about rentals.

00:12:39.360 One thing that I've been hearing

00:12:40.500 a lot about in the United States

00:12:42.480 is the idea that large investment funds

00:12:48.520 are going around

00:12:49.680 and buying up single family homes

00:12:51.140 and turning it into rental stock

00:12:54.960 that they're outbidding.

00:12:56.600 Have you seen any evidence of that

00:12:58.840 in Canada at this point?

00:13:00.540 No, I think that story is overblown.

00:13:02.780 Certainly there are corporate interests at play

00:13:05.940 that are buying some.

00:13:07.260 It's really not.

00:13:08.420 I think it's an insignificant number.

00:13:09.700 And the reason is just that

00:13:10.620 that business model does not scale in Canada.

00:13:13.400 In the US, you can buy a single family home

00:13:15.460 and you can cash flow it

00:13:17.300 even at current rates

00:13:18.540 because house prices are not so crazy there.

00:13:21.140 If you try to do that in Canada,

00:13:23.300 every home that you...

00:13:24.060 I mean, unless you're willing to bend the rules

00:13:25.720 and as I said,

00:13:26.920 put a bunch of international students in it,

00:13:28.820 which these corporations are not.

00:13:32.100 The business model, it can't scale

00:13:34.400 because every time you buy one,

00:13:35.840 you're in negative cash flow position, right?

00:13:38.700 The rents are not going to cover

00:13:39.800 if you're going to finance that

00:13:40.760 at 70% loan to value or whatever.

00:13:44.460 It's just not a scalable model.

00:13:46.260 And so the ones that tried to break into Canada

00:13:48.220 and look at that model

00:13:49.020 quickly realize that the economics are not there.

00:13:51.440 So I think that narrative was overblown,

00:13:53.540 to be honest.

00:13:54.800 Okay, but it is something that's happening

00:13:56.480 in the United States to a degree.

00:13:58.700 Without question,

00:13:59.820 it was happening in the United States.

00:14:01.000 Absolutely.

00:14:02.060 But it can't here.

00:14:03.940 I mean, that's in part

00:14:05.280 because our housing prices are so much higher.

00:14:09.180 How did we get here?

00:14:10.680 How did we get to the point

00:14:11.860 that we're so out of whack

00:14:13.640 with where the Americans are?

00:14:16.600 You know, my sense from just my time

00:14:19.940 buying and selling homes

00:14:21.980 and not as an investor,

00:14:23.640 just as a place to live,

00:14:24.860 is that we've always been a little bit higher,

00:14:27.420 but now we're a lot higher.

00:14:29.220 And how did we get on that track

00:14:31.200 where the idea of, you know,

00:14:34.820 a home costing three years of income

00:14:37.980 or four years of income

00:14:39.220 that it's no longer the case?

00:14:43.960 Well, it's been a slow burn.

00:14:46.080 It's been something

00:14:47.020 that's been unfolding over years.

00:14:48.580 The fundamental difference

00:14:49.620 between Canada and the U.S.,

00:14:51.060 it's first important to note

00:14:52.700 that Canada,

00:14:54.140 in spite of the vast geography here,

00:14:56.560 we're actually very urbanized, right?

00:14:58.580 So there's a very high proportion

00:15:00.180 of Canadians that live in big cities.

00:15:02.180 And unlike in the U.S.,

00:15:03.320 we really don't have affordable

00:15:04.880 secondary markets

00:15:06.500 in places like Ontario and B.C., right?

00:15:08.920 It's different when you get

00:15:09.720 on the prairies and out east,

00:15:10.960 but really the big provinces

00:15:13.380 that move the needle 0.98

00:15:14.280 don't have secondary cities

00:15:16.360 that are particularly affordable.

00:15:17.360 So for example,

00:15:18.020 like you can drive or commute

00:15:20.040 an hour, an hour and a half

00:15:21.500 out of Manhattan,

00:15:22.220 and you can find single family homes

00:15:24.880 that are $300,000 U.S.

00:15:26.780 Now you try going an hour

00:15:28.280 from downtown Toronto,

00:15:30.140 you're not going to find anything

00:15:31.220 for under a million, right?

00:15:32.800 So even when you do

00:15:33.380 the currency adjustment,

00:15:34.280 we're just, it doesn't make sense.

00:15:36.500 And so now in terms

00:15:37.500 of how we got here,

00:15:39.240 I think that the number one issue

00:15:41.820 is we have just made it

00:15:43.400 so difficult to build homes.

00:15:46.660 We've just seen such a,

00:15:48.760 there's so much red tape,

00:15:49.980 it's so difficult

00:15:50.680 to bring supply to market

00:15:52.480 that we just have not seen

00:15:54.880 the supply keep up

00:15:55.880 with population growth.

00:15:57.200 And I think that's any policy

00:15:59.180 that we're seeing,

00:15:59.720 and I think we're starting

00:16:00.640 to get a recognition

00:16:01.360 out of Ottawa

00:16:02.100 that that is the fundamental pinch point.

00:16:04.180 The federal government

00:16:05.200 can sort of control population growth

00:16:08.660 or target population growth,

00:16:10.100 but the actual ability

00:16:11.880 or willingness to deliver the supply

00:16:13.360 rests with the municipalities.

00:16:15.180 And fundamentally,

00:16:16.020 the issue is that

00:16:16.820 you have municipal counselors

00:16:18.000 that have to listen

00:16:18.820 to their neighbors,

00:16:19.660 be like, hey man,

00:16:20.200 I don't want a shadow

00:16:21.860 from this building

00:16:22.720 in my backyard,

00:16:25.120 or I don't want,

00:16:25.860 and it's just a constant nimbyism,

00:16:28.280 this not in my backyard mentality

00:16:30.080 that is really inhibiting

00:16:31.960 the ability to deliver that supply.

00:16:34.180 So we're starting to see

00:16:35.400 recognition out of Ottawa

00:16:36.440 that that is a fundamental problem,

00:16:38.140 and we're starting to see

00:16:39.580 moves to address that.

00:16:40.760 So I'm optimistic

00:16:42.200 that we might start

00:16:43.060 to move the needle there,

00:16:43.880 but it's been a bunch

00:16:44.660 of small things

00:16:45.600 that have sort of contributed

00:16:46.560 to this over time,

00:16:47.220 but that's probably

00:16:47.740 the biggest one.

00:16:49.700 One of the complaints

00:16:50.460 that you hear

00:16:53.640 from the more progressive side

00:16:55.520 is that this is about

00:16:56.460 the financialization of housing,

00:16:58.820 that we've made housing

00:17:01.960 something you invest in

00:17:03.100 rather than something

00:17:03.800 you live in.

00:17:05.560 What do you say

00:17:06.540 about that argument?

00:17:07.580 Is there truth to it?

00:17:09.700 There is some truth for sure.

00:17:11.560 I don't know that I would frame it

00:17:13.200 as a financialization issue.

00:17:15.220 I think, again,

00:17:15.820 it gets back to kind of incentives.

00:17:17.500 And so, look,

00:17:20.040 if you look at a chart

00:17:21.180 of business investment

00:17:22.140 as a share of GDP,

00:17:23.520 and you look at a chart

00:17:24.500 of residential investment,

00:17:25.980 so investment in housing,

00:17:28.360 renovation expenditures,

00:17:29.680 new construction,

00:17:30.860 those two lines

00:17:31.960 have gone in

00:17:32.300 completely opposite directions.

00:17:33.400 So we now have a record low

00:17:35.000 in terms of business investment

00:17:36.880 as a share of GDP

00:17:37.580 and very near a record high

00:17:39.480 in terms of residential investment.

00:17:41.060 Now, why is that?

00:17:42.240 I would argue that

00:17:43.320 one of the fundamental issues

00:17:45.120 we have in Canada

00:17:45.860 is it used to be

00:17:47.680 that if you wanted

00:17:48.300 to build financial security,

00:17:50.120 you would go out

00:17:51.220 and you would invest in business,

00:17:52.460 you would build it up,

00:17:53.280 you would hire people,

00:17:54.140 you would create something of value.

00:17:55.980 And that was the means

00:17:57.540 to create that financial stability.

00:17:59.300 And today,

00:17:59.820 it's really because

00:18:00.560 of the tax structure

00:18:01.420 and some of the incentives

00:18:02.180 and the fact that

00:18:03.020 there is not enough housing

00:18:04.480 and so it creates speculation.

00:18:06.840 Now, if you want to get

00:18:07.740 financially secure,

00:18:09.200 you go out

00:18:09.620 and you buy the biggest house you can

00:18:10.920 and you borrow as much money

00:18:11.920 and then you just sit

00:18:12.640 and you let the tax-free

00:18:14.020 capital gains accrue.

00:18:16.000 And that's a problem

00:18:17.800 because what it means

00:18:19.060 is we're not investing

00:18:20.440 in future productivity growth

00:18:22.540 in this country.

00:18:23.320 And that is really

00:18:24.540 a major issue.

00:18:26.300 And so more than anything,

00:18:28.600 I wouldn't characterize

00:18:29.240 it as financialization.

00:18:30.060 I just think we have

00:18:30.600 misalignment in terms of

00:18:32.260 how we build wealth

00:18:33.520 in this country.

00:18:35.280 Well, for an awful lot of people,

00:18:36.720 the retirement plan

00:18:37.680 is buying their home,

00:18:39.980 paying it off,

00:18:40.800 and then that becomes

00:18:42.260 a big part of their

00:18:43.240 retirement future,

00:18:45.300 isn't it?

00:18:46.880 Absolutely, we see that.

00:18:47.960 And so we can look

00:18:49.180 at something like

00:18:49.820 the share of household assets

00:18:51.300 that are connected

00:18:52.160 to residential real estate.

00:18:53.400 It's close to the highest

00:18:54.280 on record.

00:18:55.480 So there's no question

00:18:56.420 that that's the case.

00:18:57.860 I just don't think

00:18:58.720 it's not conducive

00:19:00.600 long-term to building

00:19:01.420 a prosperous economy.

00:19:02.540 And so to frame it for you,

00:19:04.940 when we look at

00:19:05.580 all investment in Canada,

00:19:07.200 right,

00:19:07.440 and that includes

00:19:08.220 public sector investment,

00:19:09.560 building bridges

00:19:10.260 and roads

00:19:11.900 and everything else,

00:19:12.760 private sector investment

00:19:14.040 in businesses,

00:19:14.920 and then residential investment.

00:19:17.340 So housing investment alone

00:19:19.120 accounts for about 40%

00:19:20.380 of all investment

00:19:21.480 in the country.

00:19:22.240 And you might say,

00:19:22.700 well, what does that mean?

00:19:23.400 That's just a nebulous number.

00:19:24.980 There's no context to it.

00:19:27.440 But if we look at OECD countries

00:19:29.760 in the last 30 years

00:19:31.160 that have hit that threshold,

00:19:32.740 there's only ever been three,

00:19:33.760 and it was Spain,

00:19:34.840 Greece,

00:19:35.140 and Ireland

00:19:35.680 in the mid-2000s.

00:19:37.440 And the subsequent years

00:19:38.860 were devastating

00:19:39.560 for those countries

00:19:40.360 precisely because

00:19:41.460 they had a massive

00:19:42.920 capital allocation

00:19:43.840 towards non-productive

00:19:45.320 real estate

00:19:45.840 and away from businesses.

00:19:47.680 And ultimately,

00:19:48.300 in order to justify

00:19:49.820 these high house prices,

00:19:50.960 we have to have

00:19:52.180 economic growth

00:19:53.800 that will build

00:19:54.820 our way out of it.

00:19:56.340 And in countries

00:19:57.380 that have not had that model,

00:19:59.720 it's been a very rough

00:20:01.120 go for them.

00:20:02.040 Now, maybe Canada

00:20:02.800 is going to be different,

00:20:03.540 but I'm not super optimistic

00:20:04.900 that's going to be the case.

00:20:06.840 All right.

00:20:07.100 When we come back,

00:20:08.000 we're going to take

00:20:08.520 a quick break right now,

00:20:09.400 but when we come back,

00:20:10.200 I want to ask you about

00:20:10.940 what policies can be brought

00:20:12.860 in to build that capacity,

00:20:15.300 to build those homes

00:20:16.300 that we need,

00:20:16.960 whether it's for those of us

00:20:18.200 who are living here already

00:20:19.280 or the half a million

00:20:21.300 people a year

00:20:22.140 that are coming in

00:20:22.840 just as permanent residents,

00:20:24.220 never mind,

00:20:24.660 as we've already discussed,

00:20:25.880 the non-permanent residents

00:20:27.300 coming in

00:20:27.940 at super high numbers.

00:20:29.600 More on that

00:20:30.440 when we're back.

00:20:32.120 When you look at the numbers

00:20:33.380 that are put forward

00:20:34.600 by politicians,

00:20:35.620 by housing experts,

00:20:37.020 it's staggering.

00:20:38.200 Ontario alone

00:20:39.180 needs to build

00:20:40.260 1.5 million homes

00:20:42.840 over the next 10 years

00:20:44.540 just to keep up

00:20:45.940 with where we are now

00:20:47.140 in terms of affordability.

00:20:48.460 That's before even

00:20:49.360 doing anything

00:20:51.120 to bring house prices down.

00:20:54.040 Is that even feasible?

00:20:56.240 Ben,

00:20:56.820 that's a question

00:20:57.720 I'll put to you.

00:20:58.480 I mean,

00:20:58.660 that's a lot of houses

00:20:59.880 going up at all the same time.

00:21:01.580 Now,

00:21:01.700 that's not all

00:21:02.300 single-family homes.

00:21:03.880 You know,

00:21:04.540 the building going up

00:21:05.600 right next to me

00:21:06.220 is going to have

00:21:06.980 several thousand of those,

00:21:08.820 or sorry,

00:21:09.440 several hundred,

00:21:10.260 at least,

00:21:10.860 condo units,

00:21:11.860 but each of them

00:21:13.440 being a housing unit,

00:21:14.480 but can we hit

00:21:15.160 that kind of target?

00:21:16.000 I think it's 1.5 for Ontario,

00:21:17.900 3.5 million for

00:21:19.400 the whole country.

00:21:22.120 Well,

00:21:22.160 it's a daunting task

00:21:23.020 for sure.

00:21:24.180 We have done it in the past.

00:21:25.500 We have seen that level

00:21:26.580 of construction activity

00:21:27.940 in the past.

00:21:28.860 The problem today

00:21:30.060 is there's just

00:21:30.580 so many roadblocks

00:21:32.260 in the way,

00:21:33.180 particularly at the

00:21:33.960 municipal level.

00:21:34.660 So how do we get there?

00:21:36.400 I think that

00:21:37.420 the path to restoring

00:21:38.920 any reasonable affordability

00:21:40.800 that doesn't involve

00:21:42.000 just a dramatic collapse

00:21:43.420 in pricing,

00:21:44.400 I think has to be

00:21:45.840 a combination

00:21:46.680 of both demand-side measures

00:21:49.400 and incentivizing supply.

00:21:51.840 And so we've seen

00:21:54.360 the federal government

00:21:55.700 come out just recently

00:21:57.020 and announce

00:21:59.180 the removal of GST

00:22:00.700 on new rental construction.

00:22:01.740 That has had

00:22:02.280 an immediate impact.

00:22:03.420 We're already seeing

00:22:04.100 new rental applications

00:22:05.500 coming in.

00:22:06.700 So that'll move the needle. 0.97

00:22:08.520 I think anything

00:22:09.280 that incentivizes municipalities,

00:22:10.940 anything that ties

00:22:11.960 transit funding,

00:22:12.940 for example,

00:22:13.460 to the willingness

00:22:15.420 and ability municipalities

00:22:16.580 to approve

00:22:17.620 those projects

00:22:19.280 and increase density,

00:22:21.500 I think that's welcome

00:22:22.420 because we do find

00:22:23.680 that that is

00:22:24.400 the pinch point

00:22:25.380 in the delivery process.

00:22:27.280 So that's how you move

00:22:28.300 the needle

00:22:28.620 on the supply side.

00:22:30.420 On the demand side,

00:22:31.320 I still think there's

00:22:31.880 a number of smaller measures

00:22:33.620 that can work.

00:22:34.640 And so I certainly think

00:22:35.540 that revisiting

00:22:36.640 the non-permanent resident

00:22:39.060 programs is very important.

00:22:42.160 I think it's the most

00:22:42.780 pressing need right now.

00:22:44.300 But I also think

00:22:45.160 that to the extent

00:22:45.820 that Canada has been 0.53

00:22:47.440 a bit of a porous border

00:22:50.020 as it relates to

00:22:51.220 illicit capital flows

00:22:52.520 internationally,

00:22:53.760 that needs to end.

00:22:55.660 And so the government...

00:22:56.860 And what do you mean by that?

00:22:58.380 Well, I think Canada,

00:22:59.660 because we're a stable democracy,

00:23:01.100 we have strong property rights,

00:23:02.960 and frankly,

00:23:04.180 it's relatively easy

00:23:06.080 to hide capital here.

00:23:07.920 It has been a destination

00:23:10.740 for capital internationally.

00:23:14.520 And so, for example...

00:23:16.880 And is that capital

00:23:17.460 going into housing?

00:23:19.000 Absolutely.

00:23:19.580 Is that part of it?

00:23:19.900 Yeah, absolutely.

00:23:20.260 So essentially,

00:23:21.200 you're talking about

00:23:21.700 foreign buyers then?

00:23:23.620 Yeah, absolutely.

00:23:24.580 That's right.

00:23:25.040 That's right.

00:23:25.420 And in particular,

00:23:26.400 people that just want

00:23:27.280 to park their capital here

00:23:28.940 effectively as a safety box,

00:23:31.380 like just a safety deposit box,

00:23:34.020 and leave homes

00:23:37.700 potentially vacant.

00:23:39.100 Now, we don't know

00:23:39.620 how big of an issue that is,

00:23:40.880 but it certainly is happening

00:23:42.200 at some scale.

00:23:43.460 And one of the simple solutions there

00:23:45.180 is the beneficial ownership registry.

00:23:50.340 And so the idea there is

00:23:51.720 because Canada makes it so easy

00:23:54.140 to park money here

00:23:55.520 and obscure the beneficial ownership

00:23:57.600 relative to other countries,

00:23:59.560 then, of course,

00:24:00.140 someone who wants to hide that money

00:24:01.920 is naturally drawn

00:24:03.840 to a jurisdiction like Canada.

00:24:05.480 And it should be much more difficult

00:24:07.000 for them to do that.

00:24:08.340 And so a beneficial ownership registry

00:24:09.580 is important.

00:24:10.640 It just means that you can't hide

00:24:11.920 behind a corporate number

00:24:13.060 and we actually will know

00:24:15.560 who owns what property.

00:24:16.740 I mean, that's one example

00:24:17.920 that I think can move the needle.

00:24:20.300 But anything, you know,

00:24:20.980 we can tighten up on...

00:24:22.020 I think we have a problem

00:24:22.940 with mortgage document fraud

00:24:24.640 in this country.

00:24:25.240 There's a very easy fix there.

00:24:26.520 I mean, there's a lot of little things

00:24:27.700 that can kind of move the needle. 0.67

00:24:28.780 So we tried to bring in 0.92

00:24:30.320 a vacant home tax in Toronto

00:24:32.180 and it was supposed to bring in

00:24:33.400 tens of millions.

00:24:34.600 It's been a failure

00:24:35.460 because lo and behold,

00:24:37.680 very few people said,

00:24:38.900 yes, my home's vacant.

00:24:40.600 Please tax me more.

00:24:42.760 Right.

00:24:43.100 Yeah.

00:24:43.200 If you're going to bring in 0.93

00:24:43.840 any policy like that,

00:24:44.720 you have to be able to enforce it.

00:24:46.000 And that's fundamentally

00:24:46.880 one of the issues

00:24:47.760 that we have in this country

00:24:48.660 is we're very soft

00:24:49.440 on things like that.

00:24:50.280 And so we can bring in policies

00:24:51.660 like that and leave glaring loopholes.

00:24:53.600 That's not a particularly

00:24:54.700 difficult fix.

00:24:55.520 You just need to enforce it

00:24:56.660 and you need to amp up

00:24:58.080 the fines associated with it.

00:25:01.640 There have been a number

00:25:04.340 of changes at the provincial level.

00:25:07.060 I mean, in Ontario specifically,

00:25:10.580 and I know Premier Eby

00:25:12.300 in British Columbia

00:25:13.040 is making many of the same changes.

00:25:16.640 And hopefully the premiers

00:25:17.580 all talk to each other about this.

00:25:19.560 Though primarily this is an Ontario

00:25:21.240 and BC problem at the heart.

00:25:23.560 But, you know,

00:25:25.300 things like trying

00:25:27.620 to lower development charges,

00:25:29.040 trying to say

00:25:30.960 that you can build

00:25:32.280 three units

00:25:34.000 on a single family lot

00:25:35.120 as a right

00:25:35.820 or a certain level

00:25:38.220 of apartment building height

00:25:40.360 on major thoroughfares.

00:25:42.880 Are these the right types

00:25:44.360 of answers

00:25:45.220 for moving development along

00:25:47.880 when you've got this nimbyism

00:25:50.020 where, as you say,

00:25:50.660 people will complain

00:25:52.020 and say, well, yeah,

00:25:53.600 more people should live

00:25:54.660 in apartment buildings,

00:25:55.560 but not near me

00:25:56.620 because I don't want the shadow.

00:25:59.220 Right.

00:26:00.340 Absolutely.

00:26:01.040 So the development charge

00:26:02.300 one is a big one.

00:26:03.380 So typically anywhere

00:26:04.580 from 25 to 30 percent

00:26:06.360 of the value

00:26:07.300 of a new home

00:26:07.980 is various forms

00:26:09.160 of taxation.

00:26:11.100 And so to the extent

00:26:11.880 that we can get that lower,

00:26:13.300 it all else equal,

00:26:14.560 it should result

00:26:15.460 in lower new house prices.

00:26:17.220 And I think

00:26:18.760 that that that can

00:26:19.720 certainly help.

00:26:21.140 Well, just to give you

00:26:22.540 a concrete example,

00:26:24.200 in Markham,

00:26:25.740 just outside of Toronto,

00:26:27.240 development charge

00:26:28.020 for a low rise home

00:26:28.960 is one hundred and sixty

00:26:29.920 two thousand three hundred

00:26:31.900 and forty eight dollars.

00:26:32.960 That's a thirty five percent 0.98

00:26:34.200 increase from two years ago

00:26:36.040 when it was one hundred

00:26:36.700 and twenty thousand.

00:26:38.120 Yeah.

00:26:38.560 So we've got taxation

00:26:39.740 all backwards.

00:26:40.500 Your listeners are going

00:26:41.600 to hate what I'm going

00:26:42.080 to say here,

00:26:42.480 but I'm going to say it anyways.

00:26:43.240 If we look at property taxes

00:26:45.260 in Canada

00:26:46.720 versus other

00:26:47.600 major cities

00:26:49.300 across the world,

00:26:50.340 especially in the U.S.,

00:26:51.720 property taxes

00:26:52.460 are actually very low.

00:26:56.180 And what we do instead

00:26:58.000 is we effectively

00:26:59.880 subsidize existing homeowners.

00:27:01.260 And I am a homeowner,

00:27:02.060 so I'm talking against

00:27:02.700 my interest here,

00:27:03.360 but we effectively subsidize

00:27:04.460 existing homeowners

00:27:05.180 and then we jam the taxes

00:27:06.420 on new builds

00:27:07.180 and effectively push

00:27:08.460 the tax burden

00:27:09.220 onto new buyers

00:27:11.140 trying to get into the market,

00:27:12.120 which is fundamentally

00:27:13.460 the wrong way

00:27:14.080 to think about it, right?

00:27:15.100 What we would rather have

00:27:16.380 is a higher carrying cost

00:27:17.740 on existing homes

00:27:18.580 that disincentivizes speculation,

00:27:20.560 for example,

00:27:21.000 from international investors

00:27:22.080 and a lower tax burden

00:27:24.380 on bringing new homes

00:27:25.500 to market.

00:27:26.080 And that's that's how

00:27:26.900 you start to address

00:27:28.060 some of the the imbalances.

00:27:30.720 Now, people are going

00:27:31.160 to listen to this and say,

00:27:31.900 well, hey, my taxes

00:27:32.680 are extremely high already.

00:27:33.980 Yeah, I know you think that,

00:27:35.140 but go look at

00:27:35.740 other international cities.

00:27:37.100 Toronto and Vancouver

00:27:37.860 have extremely low tax rates.

00:27:40.220 And I know that's

00:27:41.060 not a popular message,

00:27:41.940 but it's it's the facts

00:27:43.240 are the facts.

00:27:44.400 I lived in Ottawa

00:27:45.340 for a long time.

00:27:46.200 The property taxes

00:27:47.280 I paid in Ottawa

00:27:48.400 were akin to a house

00:27:50.300 twice the size in Toronto

00:27:51.480 because in Ottawa,

00:27:54.380 they don't have the

00:27:55.360 the same corporate tax base

00:27:57.700 to drop on.

00:27:58.880 The federal government

00:28:00.000 is the biggest landholder

00:28:02.500 and that becomes a problem.

00:28:04.260 So in Ottawa,

00:28:04.640 they do have higher property taxes

00:28:07.680 that are more in line

00:28:08.720 with the other

00:28:09.740 international jurisdictions

00:28:10.900 you're talking about.

00:28:12.480 But those types

00:28:13.280 of property taxes

00:28:14.140 in Toronto and Vancouver

00:28:15.180 would lead to riots.

00:28:17.080 Right, exactly.

00:28:17.780 So it's it's

00:28:19.160 it's a difficult solution

00:28:20.460 because good luck

00:28:21.420 running on that platform

00:28:22.620 and getting elected.

00:28:24.040 But but if we're being honest

00:28:25.820 in discussing

00:28:26.380 one of the issues,

00:28:27.500 that is that is

00:28:28.140 a fundamental issue.

00:28:29.240 You're you're making

00:28:30.100 new construction

00:28:31.040 much more expensive

00:28:31.860 than it needs to be.

00:28:33.040 And instead,

00:28:33.980 passing those tax savings

00:28:35.480 on to existing homeowners,

00:28:36.940 which is the opposite

00:28:37.620 of what we need

00:28:38.180 to be doing

00:28:38.540 if we're serious

00:28:39.260 about addressing

00:28:39.780 the supply issue.

00:28:41.120 So, you know,

00:28:41.920 like there's a lot

00:28:43.740 of moving parts here.

00:28:44.720 It's just going to require

00:28:45.840 a lot of sort of bold thinking

00:28:47.920 on the part of politicians

00:28:49.180 to address this.

00:28:51.200 In terms of the

00:28:53.200 what the the federal government

00:28:55.660 can do versus the provincial,

00:28:57.220 it seems like

00:28:58.180 for political reasons,

00:28:59.920 they're trying to overlap.

00:29:00.900 So Ontario just passed

00:29:04.340 a bunch of regulations

00:29:07.320 like we were discussing

00:29:09.840 of how many units

00:29:11.120 you can put on

00:29:11.620 a single family home,

00:29:13.220 building as of right,

00:29:15.120 things like that.

00:29:15.920 And now the federal government

00:29:16.900 is trying to come in

00:29:17.880 and negotiate

00:29:18.760 municipality by municipality

00:29:20.840 on some of these

00:29:21.800 same things.

00:29:22.700 It it seems like,

00:29:24.380 well, maybe you should

00:29:25.080 actually talk to each other

00:29:26.220 instead of just coming up

00:29:27.680 with policies

00:29:28.220 to score political points.

00:29:29.460 Right. Well, that's a novel,

00:29:31.360 novel idea, isn't it?

00:29:32.520 I think any of those policies

00:29:34.260 that try to simplify development

00:29:36.200 and take some of the decision

00:29:38.500 making away from municipalities

00:29:39.720 are actually really good thinking.

00:29:41.140 So anything that says,

00:29:42.320 look, if you're going to do X, Y and Z,

00:29:44.600 the default position

00:29:45.860 municipality needs to be yes.

00:29:47.380 And if they're going to oppose it,

00:29:48.640 they need to have

00:29:49.220 a really good reason to

00:29:50.080 because that's what we find today

00:29:51.880 is every single proposal

00:29:53.400 that comes forward

00:29:54.320 to bring new supply

00:29:55.400 is just met with

00:29:56.500 an enormous amount of red tape

00:29:58.920 and an immediate de facto

00:30:00.540 kind of no position

00:30:01.780 on the part of the municipality.

00:30:03.280 So that needs to be removed.

00:30:04.700 But to your point,

00:30:05.400 yeah, that this needs

00:30:06.680 we need to get all levels

00:30:08.100 of government together,

00:30:09.120 municipal, provincial, federal,

00:30:10.660 and get a round table

00:30:12.580 and figure this out

00:30:13.900 and at least get some concrete

00:30:15.020 and all start pulling

00:30:16.080 in the same direction.

00:30:16.960 But I would say that

00:30:17.700 it's encouraging

00:30:19.300 that at least it's become

00:30:20.540 such a hot button issue

00:30:21.720 that it's forcing politicians

00:30:23.580 to at least

00:30:24.280 at least start to really think about it

00:30:26.780 because, yeah,

00:30:28.420 this is the number one issue

00:30:29.280 I think in Canada right now.

00:30:31.740 We've got this odd situation

00:30:34.760 where, you know,

00:30:37.500 as you say,

00:30:37.800 we're a very urbanized country.

00:30:40.020 We're also a country

00:30:41.060 with huge amounts of land

00:30:42.600 and yet we've got this strong belief

00:30:46.500 that we've got to protect that land.

00:30:48.200 You know, Ontario's Greenbelt,

00:30:49.420 one example,

00:30:50.420 but even land outside the Greenbelt,

00:30:51.980 people object to building new housing.

00:30:55.020 No, we've got somehow,

00:30:57.520 we've got this belief

00:30:58.880 that you can bring in

00:30:59.880 half a million people a year

00:31:01.980 and never build a new road

00:31:03.920 and new highway

00:31:04.520 or a new subdivision.

00:31:07.060 Do we need to have a mind shift

00:31:09.660 from either for the whole population

00:31:13.240 or for that part of the population

00:31:15.300 that seems to be very loud,

00:31:17.380 very aggressive

00:31:17.980 in always wanting to say no

00:31:19.940 to development?

00:31:21.300 Well, I, for sure we do.

00:31:25.420 We need, we need to figure out

00:31:26.940 where we're going to house our population

00:31:28.360 if we're going to maintain

00:31:30.000 anywhere close to this level

00:31:31.460 of population growth

00:31:32.300 and so I would put it

00:31:34.660 to the people

00:31:35.380 that are standing in the way

00:31:36.660 and saying,

00:31:37.420 like that are opposing any population

00:31:41.340 or any new construction,

00:31:43.200 like how are we going to do this?

00:31:44.560 What's your solution, right?

00:31:45.960 And so if we're going to protect

00:31:47.340 the Greenbelt in its entirety,

00:31:49.380 fine,

00:31:49.780 where are we going to put everyone, right?

00:31:52.440 We have to give some serious thought

00:31:54.620 to making that construction activity

00:31:59.020 more accessible

00:32:00.020 and if that means that parts

00:32:03.100 of the Greenbelt need to be revisited

00:32:04.520 and not the ecologically sensitive parts,

00:32:07.960 maybe that's a discussion

00:32:08.800 we need to have.

00:32:10.780 In terms of the slogans that you hear,

00:32:14.300 it's build up, not out.

00:32:15.720 Um, I live in a box in the sky

00:32:20.340 that works for me right now

00:32:22.420 but that's not for everyone.

00:32:24.540 Is there, is it right to say

00:32:29.400 that we should only be building up,

00:32:30.960 not out, only doing more density

00:32:32.940 or what should the mix be?

00:32:35.140 Well, it's important to contextualize it.

00:32:38.940 The major cities in Canada

00:32:40.760 relative to other big cities

00:32:42.780 of similar population

00:32:43.740 are actually not particularly dense.

00:32:46.860 So there is lots of room there

00:32:48.680 to add density

00:32:49.880 just to catch up to global peers.

00:32:51.480 And so anything that emphasizes

00:32:53.240 that makes a lot of sense

00:32:54.220 because you can,

00:32:54.860 you're effectively,

00:32:55.280 you're utilizing existing infrastructure.

00:32:57.620 Um, it, it, it's just,

00:32:58.940 it's just sensible.

00:32:59.800 So the push towards density

00:33:01.760 makes sense.

00:33:02.600 The tricky thing is

00:33:03.300 it's not always an easy sell for Canadians

00:33:05.000 because we still have very much ingrained

00:33:06.400 that the single family home

00:33:08.020 is kind of the ideal

00:33:09.060 and everybody wants to have a backyard

00:33:10.260 and all this.

00:33:11.160 Um, there is a,

00:33:12.140 a sort of a middle ground

00:33:13.420 that's not explored as often.

00:33:15.600 And you'll often hear

00:33:16.620 in the development industry,

00:33:17.580 people talk about the missing middle,

00:33:19.480 right?

00:33:19.920 And so this idea that,

00:33:20.880 uh, in Canada,

00:33:22.040 we tend to think of

00:33:22.780 it's either single family,

00:33:24.280 low rise with a backyard

00:33:25.320 or it's like a,

00:33:26.600 you know, 50 story condo.

00:33:28.140 And, and in reality,

00:33:29.540 in a lot of major cities internationally,

00:33:31.640 there's a middle ground,

00:33:32.480 which is kind of mid-level development,

00:33:35.200 three, four, five floors,

00:33:37.640 but still decent sized units.

00:33:39.280 You're not jamming people

00:33:40.500 into 350 square foot units.

00:33:42.440 Um, and that really does not exist

00:33:44.180 in, in, in size in Canada.

00:33:46.280 And there's a lot of push

00:33:47.320 to bring that in

00:33:48.240 because it's a,

00:33:48.760 it's a sort of a softer density

00:33:50.400 that, that seems to have some appeal,

00:33:52.520 but is, is for whatever reason,

00:33:54.500 not getting a lot of approval

00:33:56.580 in, in, in the cities.

00:33:57.860 I remember living in, uh,

00:34:00.400 Montreal years ago

00:34:01.960 in neighborhood called

00:34:03.180 Notre Dame de Grasse

00:34:04.060 and whole area

00:34:06.940 that I lived in

00:34:07.880 was purpose-built duplexes,

00:34:10.100 um, of the type that I've,

00:34:12.340 I've never seen, uh,

00:34:14.120 in other parts of the country.

00:34:15.380 And it was designed

00:34:17.300 for the owner to live

00:34:19.160 on the, the main floor

00:34:20.740 in the basement

00:34:21.420 and to have room

00:34:23.320 for a tenant upstairs.

00:34:23.860 And to me, this is a great idea

00:34:27.240 that adds density

00:34:28.500 while still giving people

00:34:29.580 that single family home.

00:34:30.880 We don't seem to,

00:34:31.880 to look at those things

00:34:32.840 that, that we had

00:34:33.920 in the, the mid fifties

00:34:35.240 when we were having,

00:34:36.080 last having the giant population boom

00:34:38.160 that like we're having now.

00:34:39.860 No, that's exactly right.

00:34:40.680 That's exactly the type of structure

00:34:42.200 that we're talking about.

00:34:43.040 And, and, and those seem to be,

00:34:45.600 um, I mean,

00:34:46.220 it seems to be a reasonable compromise.

00:34:48.440 Uh, but you,

00:34:49.900 what you find is when you try to

00:34:51.540 put those types of developments

00:34:53.520 in existing single family neighborhoods,

00:34:56.000 you get a lot of pushback

00:34:57.560 and, and the municipalities don't,

00:34:59.880 for whatever reason,

00:35:00.340 don't want to allow it

00:35:01.080 because they don't want to hear

00:35:01.680 their own citizens

00:35:02.500 kind of screaming and crying about it.

00:35:04.560 And that's, again,

00:35:05.900 gets back to this idea

00:35:06.760 that we have a pinch point

00:35:07.700 in the approval process.

00:35:09.480 And we need to think about

00:35:10.880 how we get around that

00:35:12.720 and incentivize municipalities

00:35:13.780 to get on board.

00:35:15.200 Well, maybe, uh, voters

00:35:17.020 will start to realize

00:35:18.120 that they've got to, um,

00:35:20.700 adapt to some of this

00:35:21.800 as they realize their kids

00:35:23.740 and their grandkids

00:35:24.440 won't be able to afford a home

00:35:25.700 the way that they have.

00:35:27.660 Maybe that will be

00:35:28.620 what finally gets us to change.

00:35:30.660 Well, we're getting close

00:35:31.220 to that crisis point,

00:35:32.280 but, but I think it gets back

00:35:33.300 to this idea

00:35:34.280 that if we can clearly delineate,

00:35:36.500 right?

00:35:36.780 So if, if we can get a,

00:35:38.440 a framework in place

00:35:39.600 where we say to,

00:35:41.480 to any developer

00:35:42.340 that wants to bring the supply,

00:35:43.420 if we say,

00:35:43.880 if it fits and conforms

00:35:45.240 within this box,

00:35:46.040 the default from the municipality

00:35:47.860 has to be yes.

00:35:48.800 And if they're going to oppose it,

00:35:49.920 they have to have

00:35:50.500 a really good reason.

00:35:51.460 And the other,

00:35:51.880 the other thing

00:35:52.460 that we find oftentimes

00:35:53.380 that's frustrating,

00:35:54.220 I know for,

00:35:54.720 for people trying

00:35:55.300 to bring this supply

00:35:56.220 is to get you

00:35:57.220 these kind of nuisance lawsuits,

00:35:59.080 right?

00:35:59.220 It costs nothing

00:35:59.860 for a citizen group

00:36:01.040 to throw in

00:36:01.740 all sorts of nuisance lawsuits,

00:36:03.440 add hundreds of thousands

00:36:04.220 of dollars in legals,

00:36:05.700 delay the projects

00:36:06.620 by, by a year or more,

00:36:08.820 tie it up in the municipal board.

00:36:10.080 And, and one policy thought

00:36:12.960 should be that

00:36:13.780 if a citizen group

00:36:16.240 wants to oppose

00:36:17.200 a development

00:36:18.120 that fits within

00:36:19.180 an existing framework

00:36:20.220 for fast approval,

00:36:21.460 then they need to then

00:36:23.500 pony up some form

00:36:25.200 of kind of debenture

00:36:26.900 that is then held

00:36:27.940 by the court.

00:36:28.820 And if they lose that appeal,

00:36:30.360 that money goes

00:36:31.340 to the developer

00:36:31.960 because right now

00:36:32.900 there's nothing

00:36:34.000 that's stopping people

00:36:35.600 from just throwing up

00:36:36.800 constant lawsuits

00:36:38.680 against developers

00:36:39.660 trying to,

00:36:40.320 to bring the supply.

00:36:41.980 And so it's like,

00:36:43.020 it's, it's,

00:36:43.440 it's a free option

00:36:44.200 and we need to,

00:36:46.240 you know,

00:36:46.400 we need to think about

00:36:47.240 how to kind of tilt

00:36:47.940 those balances a little.

00:36:49.640 All right.

00:36:49.880 Well, Ben,

00:36:50.300 it's been a great conversation

00:36:51.500 and hopefully some

00:36:52.260 of the political leaders

00:36:53.640 who can make these changes

00:36:54.620 are listening.

00:36:56.140 Thanks for having me, Brian.

00:36:56.780 Appreciate it.

00:36:57.700 Thanks for the time.

00:36:58.560 All right.

00:36:58.920 Full Comment

00:36:59.380 is a post-media podcast.

00:37:01.100 My name's Brian Lilly,

00:37:01.940 your host.

00:37:02.820 This episode was produced

00:37:03.860 by Andre Pruh

00:37:04.680 with theme music

00:37:05.420 by Bryce Hall.

00:37:06.260 Kevin Libin

00:37:06.760 is the executive producer.

00:37:08.780 You can subscribe

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00:37:20.620 I'm Brian Lilly.

Full Comment - October 09, 2023

The housing crisis is a sign of worse things to come

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